Automakers have sent another letter to the governments of the US and California regarding upcoming fuel economy rules, asking the EPA to stop a planned fuel economy rollback, the New York Times reports.
Currently, the EPA and DOT are finalizing a rollback of fuel economy standards, which is expected to go into place soon despite challenges by California and the 13 “CARB states” that follow California Air Resources Board rules. If implemented, the plan would likely split the US auto market and cause nightmares for automakers – at least those that sell polluting cars.
17 automakers signed the letter. Companies include Ford, GM, Toyota, Volvo, BMW, Honda, Mazda, Nissan, Subaru, Volkswagen and others. Notably, Fiat Chrysler, one of the American “big three” but who have among the worst overall fleet fuel economy, did not sign the letter. Fiat Chrysler also recently pledged $2 billion to Tesla for help meeting EU emissions rules.
Originally, automakers had lobbied for this change, but have recently gotten cold feet as it has gotten closer to implementation and they have realized the chaotic ramifications it would cause.
The letter sent to California requested that the state seek a “midway” between the rules in place, set by President Obama, and the lack of rules proposed by Mr. Trump’s EPA. California, for their part, seems happy to continue with the rules as planned and has shown no interest in re-opening negotiations which were already closed.
Last year, California filed suit in federal court with 17 other (mostly CARB) states to oppose the EPA’s proposed rollback. If California does continue with the rules as planned, and continues suing the federal government to keep their right to set their own standards established in the 1970 Clean Air Act, it’s likely that the US auto market would be split between CARB and non-CARB states. The states involved in this lawsuit represent 140 million Americans and 43% of the US car market.
The split market would cause trouble for automakers as they would likely offer different models, pricing and advertising across state lines to try to satisfy different rulesets. But since state borders are porous, consumers could buy cars across state lines and disrupt automakers’ plans, causing more headaches. Or they could, of course, do something good for themselves and just follow the strictest rules everywhere.
As a former EPA official stated a few months ago:
“If you go with Trump, it solves the short-term temper tantrum and the threat of trade wars on the horizon. But that is also taking a big legal risk. Because in the long term, California could win the legal fight to keep its state standards. Trump is right now, but California is forever.”
The Obama-era standards are expected to save US consumers $1.7 trillion through 2025, avert 570 million tons of emissions by 2030, and save thousands of lives per year while averting poor health effects of pollution like childhood asthma. Rolling back those standards would likely also have a negative effect on electric vehicle adoption.
Until the automakers requested this change, they were already on trajectory to meet or exceed the new standards, and at lower cost than they had projected.
It is clear that the rollback of these fuel economy standards is being poorly considered, but that’s nothing new for this EPA.
It’s not a surprise that a person with capacity for boundless pettiness, with no ability to understand nuance and no grasp of the issues would overreact to a request for small policy modifications. Automakers must have known this ahead of time, and yet they still opened Pandora’s box by asking such a profoundly ignorant individual, who has staffed the EPA with bought-and-sold science deniers, to change rules which had already been set through years of negotiation and lobbying.
They have nobody to blame but themselves for this, and they need to know it.
Plus, even had their efforts “succeeded” in getting looser regulations on themselves, not only would it be worse for the planet which all employees and investors of automakers rely on for their livelihoods, but their success would have little effect given that Europe and China are rightly pushing forward with stronger emissions rules.
Looser regulations would make things worse for the companies involved. We just reported on GE losing $200 billion in market cap due to their bet on fossil fuels, as the world has moved forward without them. These short-term regulations could also tamp down on America’s green technology industries, and result in a worse standing in the world as everyone cleans up their act. This would mean less profits and less jobs for Americans.
It seems like automakers have finally realized the mistake they made and are trying to stop it, but their efforts are too little too late. We knew at the time that this was a bad idea, but they couldn’t help themselves from fighting against regulations, no matter how bad of an idea it was for them to do so. Perhaps they’ll learn their lesson the next time around, and try to think a little longer term, beyond the current episode of reality TV playing out in the White House.
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