Reduce Auto Sector Greenhouse Gas Emissions

Whereas:

Passenger vehicles account for one-fifth of all annual U.S. greenhouse gas emissions linked to global climate change that are released in the U.S. each year. The production, transportation and use of gasoline for cars and light trucks (SUVs, minivans, pick-ups) resulted in the emission of 302 million metric tons (MMT) of greenhouse gases by the U.S. in 2000.

American's heavy reliance on petroleum products to power vehicles also affects national security, as today more than half of the oil consumer in the U.S. is imported. U.S. cars and trucks consume 11% of the world's total oil production, and account for 40% of U.S. oil consumption.

Cars and trucks are the largest single source of air pollution in most urban areas. Nearly 100 million Americans live in EPA-designated "air quality nonattainment areas" that expose them to unhealthy levels of ground-level ozone, particulate matter, sulfur dioxide and other pollutants.

We feel that using available and emerging improvements to conventional technologies - addressing aerodynamic design, vehicle load reduction, improved engine efficiency, transmission innovations, and integrated starter-generators - automakers can build a fleet of vehicles that average 40 miles per gallon (mpg) by 2012. Hybrid gasoline-electric vehicles could boost that average to at least 55 miles per gallon by 2020. These fuel economy gains can be achieved without sacrificing safety, comfort or utility for consumers.

We believe that high greenhouse gas intensity of U.S. vehicle manufacturers undermines competitive positioning of U.S. exports to climate-conscious economies. Companies may face unexpected costs associated with the imposition of greenhouse gas emission regulations. Substantial new opportunities may open up for proactive firms capable of meeting demand for cleaner, more efficient technologies in the global marketplace.

GM, Ford and DaimlerChrysler are all investing in advanced technologies such as hybrids and hydrogen fuel cells that could significantly address all three major problems of global climate change, urban air pollution and energy security. However, these companies have vigorously opposed recent efforts by the U.S. Congress and States to require increased fuel economy and reduced tailpipe emissions, while failing to propose alternative plans to achieve comparable environmental results. We believe that this places the financial future of these companies - and thus shareholder value - at grave risk.

This risk is underscored by research that shows that companies with top-rated environmental records in their industry are faring significantly better financially than those with worse records. From 1997-2000, these top-rated companies had 3.53% higher annual returns on investment than a broader universe of companies, and 7.8% higher annual returns than companies with low-rated environmental records.

Resolved: that the Company report to shareholders (at reasonable cost and omitting proprietary information) by August 2003 on (a) estimated total annual greenhouse gas emissions (i) from our company's own operations and (ii) from its products; (b) how the company can significantly reduce greenhouse gas emissions from its fleet of vehicle product (using a 2002 baseline) by 2012 and 2020; and (c) an evaluation of what new public policies would enable and assist the company in achieving these emission reductions.

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