Trump administration, California headed for pitched battle on auto mileage standards

President Donald Trump announced Wednesday that his administration is revoking California's authority to set auto mileage standards stricter than those issued by federal regulators.

In a tweet, Trump said his move would result in less expensive and safer cars. He insisted that new cars would be cleaner, even as they burn more gasoline than they would have under the Obama-era fuel efficiency standards.

"Many more cars will be produced under the new and uniform standard, meaning significantly more JOBS, JOBS, JOBS! Automakers should seize this opportunity because without this alternative to California, you will be out of business," Trump tweeted, a claim that Gavin Newsom, California's Democratic governor, quickly pushed back against.

Trump's move comes after the Justice Department opened an antitrust investigation into a deal between California and four automakers for tougher pollution and related mileage requirements than those sought by Trump. Trump also has sought to relax federal mileage standards nationwide, weakening a key effort by his Democratic predecessor Barack Obama to slow climate change.

California, in addition to environmental groups, vowed to fight the latest plans from Washington through the courts.

We cannot afford to backslide in our battle against climate change.- Xavier Becerra, California's attorney general

"We cannot afford to backslide in our battle against climate change," said Xavier Becerra, the state's attorney general, at a news conference.

"We have the law, facts and science on our side," added Newsom, at the same news briefing.

U.S. automakers contend that without a substantial increase in fuel efficiency, their vehicles will be less competitive globally, which could potentially result in job losses.

"Automakers support year-over-year increases in fuel economy standards that align with marketplace realities, and we support one national program as the best path to preserve good auto jobs, keep new vehicles affordable for more Americans and avoid a marketplace with different standards," said Dave Schwietert, the interim CEO and president of the Alliance of Automobile Manufacturers, which represents Ford, General Motors and other leading U.S. automakers.

Emissions standards are closely linked with fuel economy requirements because vehicles pollute less if they burn fewer gallons of fuel.

Mary Nichols, chair of the California Air Resources Board, said the Trump administration move flies in the face of an industry increasingly investing in electric vehicles.

"This is the fight of a lifetime for us — we have to win this, and I think we will," she said.

It's about the oil industry, period. Full stop.- California Gov. Gavin Newsom

Nichols and Newsom both noted how the Republicans are usually vociferous in their support of state's rights.

"I don't know what the hell's happening to the Republican Party," said Newsom.

EPA Administrator Andrew Wheeler told the National Automobile Dealers Association on Tuesday the agency's goal is to establish one nationwide set of fuel-economy standards.

"We embrace federalism and the role of the states, but federalism does not mean that one state can dictate standards for the nation," Wheeler said, adding that higher fuel economy standards would hurt consumers by increasing the average sticker price of new cars and requiring automakers to produce more electric vehicles.

Waivers never rejected, California says

California's authority to set its own tougher emissions standards goes back to a waiver issued by Congress during passage of the Clean Air Act in 1970, under the administration of Republican Richard Nixon. The state has long pushed automakers to adopt more fuel-efficient passenger vehicles that emit less pollution. A dozen states and the District of Columbia also follow California's fuel economy standards.

Becerra noted the unprecedented nature of the fight since that time, even as Democratic governors such as Jerry Brown and Gray Davis served while Republican administrations were in power in Washington.

"We have been granted 100 waivers. Never has one been rejected," he said.

Newsom, admitting his "deep frustration," cited the support from the auto industry and accused the administration of kowtowing to special interests.

"It's about the oil industry, period. Full stop," he said, noting the opposition of oil companies through the years to the waiver granted to California.

The deal struck in July between California and four of the world's largest automakers — Ford, Honda, BMW and Volkswagen — bypassed the Trump administration's plan to freeze emissions and fuel economy standards adopted under Obama at 2021 levels.

The four automakers agreed with California to reduce emissions by 3.7 per cent per year starting with the 2022 model year, through 2026. That compares with 4.7 per cent yearly reductions through 2025 under the Obama standards.

It's not clear yet what the Trump administration will propose as its final fuel-efficiency rules, but in the past it has favoured freezing Obama-era mileage standards at 2021 levels. Under the Obama administration requirements, the fleet of new vehicles would have to average 30 miles per gallon (13 kilometres per litre) in real-world driving by 2021, rising to 36 mpg (15.3 km/L) in 2025. Currently the standard is 26 mpg (11 km/L).

The U.S. transportation sector is the nation's biggest single source of planet-warming greenhouse gases. Becerra said in California, transportation use accounts for 29 per cent of the greenhouse gas total.

The EPA's Wheeler said Tuesday: "California will be able to keep in place and enforce programs to address smog and other forms of air pollution caused by motor vehicles." But fuel economy has been one of the key regulatory tools the state has used to reduce harmful emissions.

Environmentalists condemned the Trump administration's move, which comes as gasoline prices have crept higher following a weekend drone attack that hobbled Saudi Arabian oil output.

"Everyone wins when we adopt strong clean car standards as our public policy," said Fred Krupp, president of Environmental Defence Fund. "Strong clean car standards give us healthier air to breathe, help protect us from the urgent threat of climate change and save Americans hundreds of dollars a year in gas expenses."

Under Trump, the EPA contends that freezing the fuel economy standards will reduce the average sticker price of new vehicles by about $2,700 US by 2025, though that predicted savings is disputed by environmental groups and is more than double the EPA estimates from the prior administration.

Trump's tweet does not address the money consumers would save at the gas pump if cars got better mileage. A study released by Consumer Reports in August found that the owner of a 2026 vehicle will pay over $3,300 more for gasoline during the life of a vehicle if the standards are frozen at 2021 levels.

Trump's announcement on Wednesday came about an hour after after an Environmental Protection Agency spokesperson said, when asked about the subject by The Associated Press, "We have nothing to announce at this time."