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U.S. OEMs Pushing for New Fuel Efficiency Rules

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Jan. 16, 2019—According to a Reuters report, executives at the major U.S. OEMs are pushing the Trump administration and California to agree on standards for fuel efficiency and carbon emissions throughout the next 6 years. Meanwhile, risks increase that a deadline for setting national standards will pass without a deal. 

The automakers feel that the time frame has already arrived in which decisions need to be made about what engines and fuel-saving technology will be in use for vehicles like hybrids and fully electric vehicles in 2021 and beyond. 

Late last summer, the Trump administration proposed freezing fuel efficiency requirements at 2020 levels through 2025 and taking from California the ability to impose stricter rules. The administration also may yet eliminate compliance credits that automakers get for making electric vehicles. 

Trump's preferred freeze would result in 500,000 barrels per day more oil consumption by around 2030, according to the report. Meanwhile, a group of about 20 states, led by California, has challenged the administration's proposal as unlawful, and pledged to sue if federal legislators move forward. The administration is expected to finalize the new rules by the end of March in order for the lessened requirements to take effect by the 2021 model year. However, some automakers question if it will meet that deadline in the wake of the partial government shutdown. 

Toyota Motor Corp's chief executive, Jim Lentz, recently told Reuters that he fears that automakers are stuck in between California and the White House. 

"I kind of feel like this is the OK Corral and we're the settlers walking across the middle," Lentz told the media outlet. 

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