Powering Business Worldwide Testimony of Chris Hess Director of Public Affairs, Eaton Eaton Corporauon VelliCie Group 13100 E MICI11Q3ll Avenue Galesburg

. Ml 49053

U.S. EPA and NHTSA Public Hearing for the Proposed Greenhouse Gas Emissions Standards 

### &Fuel Efficiency Standards for Medium- 

### & Heavy-Duty Engines and Vehicles August 6, 2015 Chicago, IL
Director Grundler and Director Trowbridge, I am Chris Hess, Director of Public Affairs for Eaton representing our Vehicle Group

. I want to thank the Agencies forthe opportunity to give testimony regarding the proposed rule today. Eaton is a power management company with 2014 sales of $22

.6 billion. Eaton provides energy-efficient solutions that help our customers effectively manage electrical, hydraulic and mechanical power more efficiently, safely and sustainably. Eaton has approximately 102,000 employees and sells products to customers in more than 175 countries

. Eaton delivers the power inside thousands ofproducts and systems that are answering the demands of today's fast-changing world. Eaton's Vehicle Group is a leader in the design , manufacture, and supply of drivetrain and powertrain systems and critical components that reduce emissions and improve fuel economy, stability, performance, and safety of cars, light trucks and commercial vehicles. Products include transmissions, clutches, hybrid power systems, superchargers, engine valves and valve actuation systems, and engine controls for the global vehicle industry. The principal markets forthe Vehicle Group are original equipment manufacturers and aftermarket customers of heavy-, medium-, and light-duty trucks, SUVs, passenger cars and agricultural equipment. First and foremost, Eaton appreciates the approach taken by both the U

.S

. EPA and NHTSA to reach out to stakeholders in industry for in
-depth technology discussions early on in the development process for Phase II. It cannot be said that the agencies did not listen to the thoughts and concerns ofthe commercial vehicle industry and other stakeholders who are a part ofthe commercial vehicle value chain in the United States.As we did in Phase I, Eaton supports the push for a new generation of clean , fuelefficient commercial vehicles that will reduce greenhouse gas emissions and 

### strengthen the U

.S

. economy. Phase I has been successful in that it put together a sound regulatory framework that is aligned with market forces to drive adoption ofthe most efficient commercially available technologies

. We believe that the framework outlined in the NPRM for Phase 2 is a good step toward a final regulation that will drive innovation and , foster both technology and competition , while maintaining fleet diversity and incentivizing over-achievement of emissions and fuel economy targets

. By following the structure created in Phase I, the agencies are relying on a proven concept that will build upon established regulatory structure, testing and processes that are efficient and fair

. We are encouraged to see that the rule implements performance-based standards that ensure that the fuel savings certified by the test procedures end up as benefits to truckers and fleets on the road Eaton believes that the separate engine and vehicle standards found in Phase I should be maintained in Phase II. The separate standards reflect the reality ofthe commercial vehicle, drive adoption ofefficient technologies and provide a structure that is proven and accepted in the U.S

. truck market. Eaton is encouraged that the proposed calls for a long-term regulation. This will provide regulatory certainty that will help companies like Eaton focus R&D efforts on investments on advanced technologies aimed at significant fuel savings

. This regulatory clarity in the market is critical as it allows Eaton time to work with our customers in the near, mid and long-term to develop technology solutions to meet the prescribed standards with the reliability, safety and performance demanded by our customers and trucking fleets. Furthermore, we are pleased that the EPA is expanding utilization ofthe powertrain test option introduced in Phase 1for hybrid certification. The powertrain test accurately measures the fuel benefits of advanced technologies in realistic driving conditions

. We believe the powertrain test option is a critical complement to modelbased certification

. The fact that the benefits of advanced transmissions and controls can be visible in the vehicle assessment, through the powertrain test option , enables OEMs to achieve compliance though these technologies in a costeffective fashion

. Eaton believes that deep engine-transmission integration , dual clutch technologies, and ultra-efficient transmissions are cost-effective way to save fuel and achieve compliance, without adding the weight, cost and complexity of some of the new and un-tested technologies

. We believe that the powertrain test option ensures the promise ofthese technologies will be realized in the commercial vehicle market.The proposed rule is a good foundation for what the new regulations can be, giving clear, achievable objectives that spur innovation and deployment, while avoiding negative impact on the economy and promoting leadership in commercial vehicle fuel efficiency. Eaton believes that many ofthe technologies needed to achieve the proposed standards are available

. Some are in low volume production , and others need a path into the market that recognizes and values contributions to emissions reduction and fuel efficiency

. Phase II will provide clear and realistic targets for industry and will accelerate adoption

. Eaton is looking forward to supporting the rule
-making process with comments to EPA and NHTSA on the proposed rule in the nearfuture

. Thank you for your attention

.