Trump says U.S. will finalize new fuel efficiency rules next year

Source: By David Shepardson, Reuters • Posted: Monday, December 9, 2019

WASHINGTON (Reuters) – U.S. President Donald Trump said on Friday that his administration will finalize its rollback of Obama-era vehicle emissions standards next year and expected it would provoke a new legal challenge by California.

The administration had signaled in recent months it could finalize its proposed revisions to the requirements before the end of 2019. The administration has argued that the rollbacks are necessary for economic and safety reasons but California and environmentalists reject that analysis, saying consumers would spend hundreds of billions more in fuel costs.

In August 2018, the administration proposed freezing vehicle efficiency requirements at 2020 levels through 2026, which would result in average fuel efficiency of 37 miles per gallon (mpg) by 2026, compared with 46.7 mpg under rules adopted in 2012. The Trump administration’s “preferred option” would hike U.S. oil consumption by about 500,000 barrels per day by the 2030s but reduce automakers regulatory costs by more than $300 billion.

Republican Trump has sought to reverse his Democratic predecessor Barack Obama’s climate change policy, which was aimed at reducing greenhouse gas emissions.

Trump said on Friday that the dispute was over “a tiny amount of fuel – of which we have plenty.” He said the rules would lead to “safer and more affordable vehicles.”

Trump, without citing any evidence, said the existing rules would require “extra computers put on the engine.”

The administration has said the rules would reduce traffic deaths because it would cut future vehicle price hikes and prod speedier purchases of safer vehicles. But some EPA staff disputed that contention, according to documents released last year, arguing it would actually lead to more traffic deaths in some years because of an increase in vehicle travel.

Last month, California and 22 other states sued to challenge the administration’s decision in September to revoke California’s authority to set stiff vehicle tailpipe emissions rules and require a rising number of zero emission vehicles.

Major automakers – including General Motors Co, Toyota Motor Corp, and Fiat Chrysler Automobiles NV – backed the administration’s effort to bar California from setting tailpipe standards.

The U.S. Department of Justice in August opened an antitrust investigation into four major automakers that struck a deal with California and has issued civil subpoenas to Ford Motor Co, Honda Motor Co, BMW AG and Volkswagen AG (VOWG_p.DE).

The administration’s final requirements are expected to modestly boost fuel efficiency versus the preferred option, with several automakers anticipating annual increases of about 1.5%, much less stringent than the Obama rules.

Reporting by David Shepardson; Editing by Chris Reese and Grant McCool