Sensing a kindred spirit in the White House, the auto industry is pressuring President Trump to roll back vehicle efficiency standards, which they imply are too stringent and could cost America jobs.
That's the burden of a letter that went out last week to Trump from the heads of 18 auto manufacturers, including General Motors, Ford and Fiat Chrysler. They asked him to reverse a ruling issued by the Environmental Protection Agency just before his inauguration that locked down fuel efficiency rules through 2025.
They don't say they want him to roll back the regulations, of course — just that they think the EPA should have taken more time to issue the ruling, which wasn't due until April 2018.
"It was rushed through," Wade Newton, a spokesman for the Alliance of Automobile Manufacturers, the industry's lobbying arm, told me. "We've repeatedly called for putting the agreed-upon procedure back on track," including the original deadline. But if you think the industry's goal is eventually to have the EPA regulations confirmed, you don't know your auto industry.
The automakers' initiative is just one of several attacks aimed at loosening federal clean-air regulations. All are likely to run up against a brick wall erected by California, the only state that has explicit permission from the feds to set its own emissions standards. These not only have been more stringent than those issued from Washington, but have been matched to some extent by more than a dozen other states. The state's rule calling for zero-emission cars to represent 15% of sales by 2025 has been adopted by nine other states. Those 10 states together account for one-third of all auto and light-truck sales in the U.S., helping to spur electric-vehicle programs at Ford, GM, Volkswagen and other manufacturers.
During his confirmation hearing last month, Trump's pick for EPA chief, Oklahoma Atty. Gen. Scott Pruitt, got cagey when asked if the state's waiver should stay in place. As my colleague Evan Halper reported, Pruitt—whose links to the oil and gas industry are well documented—didn't say he would overturn the waiver, but refused to commit to continuing it, either. His remarks drew an immediate pushback from California Senate President Pro Tem Kevin de Leon (D-Los Angeles), who said that any attempt to overrule the waiver would be met with "full resistance up and down the state."
The auto industry long has groused about California's role in emissions standards, which it says contributes to regulatory overload. "The number of government regulators (state and federal) who are interested in or currently oversee the automobile sector… continues to grow," Alliance CEO Mitch Bainwol wrote to Trump's transition team the day after the election. He listed 10 federal agencies along with the California Air Resources Board as those with oversight of the industry, and pleaded for "a robust examination of the combined impact of such uncoordinated regulatory oversight on the auto industry and the American consumer."
This wouldn't be the first time the California waiver has become a political issue. Under George W. Bush, the EPA denied the state's request for a waiver to cover motor vehicle greenhouse gas emissions in 2007. That decision was reversed by the Obama administration within months of its taking office in 2009 over the objections of Republicans, including Rep. Darrell Issa (R-Vista), who repeated industry claims that the action could cost "200,000 auto related jobs and $3.3 billion in wages."
Yet the industry also has made misleading claims about its progress on emissions and its capabilities in the future. In his Nov. 10 letter, Bainwol asserted that "smog-forming pollutants have been virtually eliminated from passenger cars, down over 99% since the 1960s" and that "we are now complying with policies designed to mitigate the last 1% of these pollutants."
That 99% reduction is true, but it glosses over the broader context: Cars and trucks are still the largest contributors to air pollution, by a goodly margin. In California, they accounted for 37% of greenhouse gas emissions in 2014. That placed them far ahead of industry, the runner-up at 24%.
"There is more work ahead of us," Mary Nichols, chair of the California Air Resources Board, told a state Assembly committee the very day of Pruitt's confirmation hearing.
Last month's EPA ruling became the focus of a tug-of-war between the automakers and the agency even before it was issued. The EPA standard calling for an industry-wide average of more than 50 miles per gallon by 2025 was the product of negotiations with the Obama White House in 2011. The deal called for the EPA to conduct a "mid-term review" of rules for 2022-25 by April 2018.
The industry got a strong sense late last year, however, that the Obama administration was planning to complete the review before Inauguration Day in order to lock in its goals. They sought assurances that the original schedule would remain in force, and sought to reduce the burden of the zero-emission vehicle rule. They argue that electric cars and other zero-emission vehicles haven't proven popular with the public, which makes the 15% sales goal unreachable. "We have the technology, but if sales aren't there, we can't meet the standards," an alliance spokeswoman told my colleague Russ Mitchell.
The industry was hoping for another year to produce more data and jawbone the EPA to lower the goal. "As recently as late last fall, EPA assured us that the MTR would not result in a final determination before the next administration came into office," the executives said in the letter, according to an account by Bloomberg. The alliance refused to provide me with a copy of the letter.
Instead, the EPA acted on Jan. 13, ruling that no change in the regulations was warranted for 2022-25 and setting up a new conflict between the Trump White House and Sacramento. The auto industry and their front persons in Congress and the White House—not to mention the fossil fuel industry—can't be happy about the ambitious program Nichols outlined for state legislators in her testimony, which involves ending the era of gasoline-powered vehicles.
"One thing is clear," she said: "We cannot meet our goals for clean air and greenhouse reductions without near-complete electrification of the transportation sector….Our focus now is figuring out the optimal pathway to transition away from combustion."