Powerful trade groups weigh merger after clean cars clash

Source: By Maxine Joselow, E&E News reporter • Posted: Sunday, December 15, 2019

Two powerful auto industry trade associations are weighing the possibility of a merger, as the industry faces upheaval from President Trump’s trade war and rollback of clean car standards.

The Alliance of Automobile Manufacturers and the Association of Global Automakers are in preliminary talks about a merger, their leaders confirmed in a statement to E&E News.

“The Auto Alliance and Global Automakers are exploring the potential for uniting the associations in pursuit of the next generation of mobility while continuing to provide consumers with safer, more energy-efficient vehicles,” said Auto Alliance interim President Dave Schwietert and Global Automakers President John Bozzella.

“While we are not ready to make announcements, we continue to make good progress towards our shared goals,” they added.

Politico first reported the potential merger, citing sources in the industry and on Capitol Hill who said it could happen as soon as Jan. 1.

The potential merger comes after Global Automakers faced a defection within its ranks over Trump’s rollback of vehicle greenhouse gas and fuel economy standards.

In October, most members of Global Automakers — including General Motors Co. and Fiat Chrysler Automobiles NV — intervened in clean cars litigation on behalf of the Trump administration (Climatewire, Oct. 29).

But Honda Motor Co. refused to participate in the motion to intervene, saying it opposed the Trump administration’s efforts to block California from setting tougher vehicle emissions standards than the federal government.

“Honda is not a participant in this litigation, and is not contributing any funds supporting our trade association’s activity in this area,” Robert Bienenfeld, assistant vice president at American Honda Motor Co., said in an email to E&E News at the time.

The Auto Alliance also faces internal divisions over the clean car rules.

Three of its members — Ford Motor Co., Volkswagen AG and BMW of North America LLC — reached a voluntary agreement with California this summer to improve fuel efficiency regardless of the rollback. Honda was also part of that deal.

The two trade associations have emerged as lobbying powerhouses on Capitol Hill.

In its most recent Senate lobbying disclosure form, the Auto Alliance reported spending $1.29 million on lobbying efforts, including on the electric vehicle tax credit and the rollback of clean car standards.

Global Automakers reported spending more than $472,000 on similar issues.

The talks between the trade associations are being facilitated by Jerald Jacobs, a partner at the Washington, D.C., law firm Pillsbury Winthrop Shaw Pittman LLP.

Jacobs declined to comment for this story, redirecting E&E News to spokespeople for the trade associations.

Global Automakers spokeswoman Annemarie Pender didn’t respond to a request for comment.