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The Insider

Details Emerge On Trump Auto GHG Rollback, Clarifying Battle Contours

As the contours become clearer regarding the contents of the Trump administration’s pending rollback of Obama-era vehicle greenhouse gas standards, it is also becoming more certain that much of the auto manufacturing sector will ultimately fall in line behind the deregulatory policy.

Two major developments are driving this dynamic; the first is hardening conventional wisdom that the final rollback rule will require a 1.5 annual improvement in auto GHGs and fuel economy, rather than a freeze of the standards at EPA and the Transportation Department (DOT) proposed.

The second is the explicit legal support from several major automakers for the Trump administration’s final rule preempting California’s auto GHG and zero-emission vehicle (ZEV) standards. Companies aligning with the White House include General Motors, Toyota, Fiat Chrysler and several others collectively representing about two-thirds of the domestic auto market.

They are ranged against four automakers -- Ford, Honda, BMW and Volkswagen -- that joined California’s voluntary “framework” on auto GHGs that offers some relief from the Obama-era requirements but is far stronger than the reported 1.5 percent improvement in the forthcoming Trump regulation.

Those four companies also pledged not to attack California’s authority.

Multiple outlets are reporting the 1.5 percent figure as the likely stringency for EPA and DOT’s Safer, Affordable, Fuel-Efficient (SAFE) Vehicles rule:

Outlines Clarify For Final Trump Auto GHG Rollback
The outlines are becoming increasingly clear for the Trump administration’s forthcoming regulation to rollback Obama-era vehicle greenhouse gas standards, with multiple outlets over the past day confirming prior Inside EPA coverage that the rule will aim for a 1.5 percent annual improvement rather than the proposed standards freeze.

Readers of Inside EPA are likely well-acquainted with this figure, as we reported it in mid-September:

Final SAFE Rule Likely To Order Modest Improvement In Vehicle GHGs
Top Trump officials appear to be settling on a strategy for its upcoming vehicle greenhouse gas and fuel economy rule that would not formally freeze Obama-era standards it is seeking to roll back but instead require a modest annual rate of improvement, though the precise timeline for moving the plan is still unclear.

That level of improvement is far less than the roughly 5 percent annual gain in the Obama-era standards, and also less than the 3.7 percent improvement in California’s voluntary “framework” deal it struck with four major automakers.

As we reported earlier, Trump officials appear to be backing away from freezing standards at model year 2020 levels after a barrage of public criticism and suggestions that such a plan would invite a court to stay implementation of the rollback.

Another source tracking the rule earlier noted that due to strategies automakers are already developing to meet both current and future requirements, a 1.5 percent annual improvement is “probably not doing much more than companies would probably do anyway.”

Now, Trump administration critics are similarly downplaying a 1.5 percent stringency. That is “still not nearly enough” for California to meet its climate and air quality goals, a spokesman for state air regulators said.

“We’re supposed to cheer because they’ve downgraded this rollback from a Category 5 disaster to a Category 4,” quipped David Doniger, the Natural Resources Defense Council’s climate director.

GM, Toyota and many other automakers appear more sanguine about the Trump administration’s efforts, however. Just a few days ago, they formally intervened in litigation challenging the administration’s final rule revoking California’s waiver of federal preemption authorizing its GHG and ZEV rules:

Automakers Back Trump In California Suit Over Vehicle GHG Preemption
A coalition making up the vast majority of automakers including General Motors and Toyota is intervening on behalf of the Trump administration in litigation from California and environmentalists targeting the administration’s preemption of the state’s vehicle greenhouse gas and zero-emission vehicle (ZEV) rules.

“With our industry facing the possibility of multiple overlapping and inconsistent standards that drive up costs and penalize consumers, we had an obligation to intervene,” said John Bozzella, president of the Association of Global Automakers, who is also acting as a spokesman for the new auto group known as the Coalition for Sustainable Automotive Regulation.

He added: “While we had hoped to avoid this outcome, we believe that it is the best way to achieve a solution that works for all stakeholders. By participating [in the litigation], we ensure consumers, auto workers, retailers and manufacturers are part of resolving the dispute between governments.”

Amid renewed discussion of the 1.5 percent stringency level for the final rollback rule, there are increasing signs that much of the auto sector will ultimately back the policy:

Modest GHG Standard Could Enable Auto Support Of Trump Rollback
The Trump administration’s pending final rule rolling back Obama-era vehicle greenhouse gas standards is increasingly expected to require a modest annual improvement in vehicles instead of freezing requirements, a step that could help pave the way for most of the auto manufacturing sector to ultimately support the plan.

“We would have to study the entire package to determine what it would mean, looking at flexibilities, credits and timelines in addition to stringency,” Alliance of Automobile Manufacturers spokeswoman Gloria Bergquist said in a Nov. 1 statement to Inside EPA, noting it is too soon to state a position on the rule.

But, she noted, “we are pleased that the administration seems focused on increasing standards while still aligning them with the marketplace and what consumers are buying. This is good for consumers and auto workers.”

Nevertheless, GM and other automakers’ decision to intervene in the preemption case is sparking significant pushback from California and its allies on the Hill:

House Hearing Showcases Early Pushback To Trump-Aligned Automakers
A House hearing on the Trump administration’s rollback of vehicle greenhouse gas controls is showcasing early political pushback against several major automakers that are supporting the Trump administration’s attack on California’s regulations, with critics seeking to paint the companies as short-sighted foes of clean vehicles.

“Please come explain to us why you don’t believe you must play a vital role in solving the climate crisis,” said House oversight committee environment panel Chairman Harley Rouda (D-CA), during an Oct. 29 hearing, charging that the companies similarly don’t care about the health of American citizens and building more efficient cars.

“And above all, explain to us why you have chosen to align yourself with an administration that is stuck in the past.”