Trump moves to lower fuel economy mandates, cancel California's ability to set stricter rules

Trump moves to lower fuel economy mandates, cancel California's ability to set stricter rules

Two-pronged fight will likely lead to lengthy court battles.

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August 3, 2018
By Robert Schoenberger
Cars/Light trucks Economy Electric vehicles Lightweighting Manufacturing Regulations

Vehicles such as the 2018 Chevrolet Volt (pictured) would not be necessary to meet federal fuel economy standards proposed Thursday by President Donald Trump's administration.

Cleveland, Ohio – President Donald Trump’s administration plans to roll back Obama-era fuel economy regulations and deny California the right to set its own rules, likely setting up a fight that will tie up the future of fuel economy in the courts for the foreseeable future.

Since his inauguration, Trump has been promising to lower rules set by his predecessor that called for the U.S. vehicle fleet to reach 54.5mpg by 2025 (although credits for changing air conditioning refrigerants and other changes meant a real-world standard of about 45mpg). And regulatory agencies unveiled plans in April to start a rulemaking process to unravel those mandates.

Environmental Protection Agency (EPA) Acting Administrator Andrew Wheeler said, “Our proposal aims to strike the right regulatory balance based on the most recent information and create a 50-state solution that will enable more Americans to afford newer, safer vehicles that pollute less. More realistic standards can save lives while continuing to improve the environment.”

The mention of a 50-state standard is critical. In 2012, automakers agreed to the much higher standards set by the Obama administration because it promised to get rid of a two-tiered system in which most states followed the federal rules, but California sets tougher standards that 12 other states follow.

The 2012 agreement called for a higher standard that regulators in California and the federal government could agree to and that automakers said they could reach. However, that deal called for a review, midway through the regulatory process to see if the 54.5mpg figure was still achievable. In his last days in office, Obama’s EPA ruled that those standards were fine, cutting short the mid-cycle negotiations.

In April, when Trump’s administration announced plans to revisit that review, officials also said they’d consider revoking a waiver that allows California to set its own standards. The proposals released Thursday take that step.

Reaction in that state was swift with the attorney general and other lawmakers vowing to fight the change.

California Gov. Jerry Brown, D, said, “For Trump to now destroy a law first enacted at the request of Ronald Reagan five decades ago is a betrayal and an assault on the health of Americans everywhere. Under his reckless scheme, motorists will pay more at the pump, get worse gas mileage, and breathe dirtier air. California will fight this stupidity in every conceivable way possible.”

The likelihood of a protracted court fight is a worst-case scenario for automakers. It takes years to design a vehicle, tool up a plant, and start marketing future products. If California wins the fight, vehicles designed to meet the lower federal figures would mean having new products that companies couldn’t sell in the largest auto market in the country.

Or, if automakers bet on California winning, they could spend billions on fuel-efficient vehicles for that market but find little demand for them if they have to compete against less-efficient, less-expensive options.

That uncertainty was reflected in a joint statement from the Auto Alliance and Global Automakers trade groups. Despite the fact that lower standards gives producers more flexibility and will likely lower costs, the lack of direction makes figuring out what's next difficult. Rather than embracing the regulatory rollback, companies urged regulators to collaborate on a new deal. 

“Automakers support continued improvements in fuel economy and flexibilities that incentivize advanced technologies while balancing priorities like affordability, safety, jobs, and the environment," officials from both groups said. "With today’s release of the administration’s proposals, it’s time for substantive negotiations to begin. We urge California and the federal government to find a common sense solution that sets continued increases in vehicle efficiency standards while also meeting the needs of America’s drivers.”

The most vocal opponents of the change are environmental groups.

Simon Mui, the California lead for the National Resources Defense Council’s clean cars program, said, “California’s devastating wildfires show the state has a compelling and extraordinary need to safeguard its air and fight the devastating effects of climate change. This proposal reads like a bad script in which we’re forced to imagine states aren’t being harmed by bad air quality and climate change hasn’t exacerbated fatal heat waves and wildfires.”

In its rejection of the higher standards, administration officials made two basic arguments – that higher mileage standards weren’t necessary and that they risked public safety. The first argument is tied up within the national, highly political debate surrounding global warming. The second relies on the argument that lighter, more efficient cars are less safe that heavy ones.

Several critics of lowering regulations said that thinking is outdated. Modern vehicle designs have lowered vehicle weights by swapping steel for aluminum in body panels, but they have reinforced crash structures with higher-tech, specialty steel alloys.

Aluminum Association President and CEO Heidi Brock issued a statement following the proposed rule’s release that noted that the National Highway Traffic Safety Administration’s (NHTSA) research showed that vehicle size and shape, not weight, determine crash worthiness.

Brock noted that the rule-making proposal says, “Several technologies, such as substitution of light, high-strength materials for conventional materials during vehicle redesigns, have the potential to reduce weight and conserve fuel while maintaining a vehicle’s footprint and maintaining or possibly improving the vehicle’s structural strength and handling.”

The publication of the tentative rule starts a 60-day comment period, and regulators will hold public hearings to discuss the standards. Lawsuits will likely be filed concurrently, creating several venues by which the rules could take place or be blocked.

About the author: Robert Schoenberger is the editor of Today's Motor Vehicles and a contributor to Today's Medical Developments and Aerospace Manufacturing and Design. He has written about the automotive industry for more than 18 years at The Plain Dealer in Cleveland, Ohio; The Courier-Journal in Louisville, Kentucky; and The Clarion-Ledger in Jackson, Mississippi.

rschoenberger@gie.net

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