Automakers meet with EPA's Scott Pruitt, who takes aim at California

Trump administration is nearing a decision on lowering CAFE standards

WASHINGTON — General Motors chairman and chief executive Mary Barra met on Tuesday with U.S. regulatory chiefs, as the Trump administration approaches a deadline for deciding whether to lower landmark fuel efficiency standards through 2025.

After Reuters learned of the meetings, GM spokesman Pat Morrissey confirmed Barra had met the heads of the Environmental Protection Agency and Transportation Department.

At the meeting, the GM CEO "reconfirmed our priorities for modernizing fuel economy standards, which is the need for one national set of requirements and the need to comprehend new technology developments like increased shared and autonomous electric vehicles," Morrissey said.

Automakers are pressing the administration to reach agreement with California to maintain a nationwide set of fuel efficiency requirements.

California Air Resources Board chair Mary Nichols said in January the board does not believe the standards should be lowered but is willing to discuss modifications if warranted. "Absent any such evidence, we will certainly resist any changes," Nichols said.

Bloomberg reported that Pruitt intends to take on California, whose more stringent standards are followed by a dozen other states and the District of Columbia, states that account for 40 percent of U.S. auto sales — meaning that automakers must build cars to those standards, effectively making California's standards national policy.

"California is not the arbiter of these issues," said Pruitt. California regulates greenhouse gas emissions at the state level, "but that shouldn't and can't dictate to the rest of the country what these levels are going to be."

The EPA has until April 1 to decide whether Obama-era corporate average fuel economy (CAFE) standards for cars and light trucks from 2022 to 2025 should be revised, and automakers say the administration is favoring a significant reduction in the standards, which aim to double average fleet fuel efficiency to about 50 mpg by 2025. Automakers agreed to those standards seven years ago.

Since then, lower gas prices have fueled consumer demand for less-fuel-efficient SUVs and pickups, making the standards more difficult for Detroit automakers especially. So automakers have lobbied the Trump-era EPA under Pruitt to lower the standards. Yet their bigger concern is that California and the federal government coordinate.

The Obama administration said the rules would save motorists $1.7 trillion in fuel costs over the life of the vehicles but cost the auto industry about $200 billion over 13 years.

Other automakers also have been holding meetings with regulators in recent weeks as have environmental groups as others. A meeting is planned this week between EPA officials and Ford Motor Co's top environment and safety officer, officials said.

Two administration officials and several automakers told Reuters the timing of proposing reductions in the requirements or new flexibilities for automakers remained in flux. EPA officials suggested a proposal could come in late May or June, while the Transportation Department is pushing for a speedier unveiling of a proposal, automakers say.

In June, New York state's attorney general, Eric Schneiderman, and 12 other top state law enforcement officials said they would mount a court challenge to any effort to roll back vehicle emission rules.

"Not only does Scott Pruitt want to put the brakes on these important standards, he's even going so far as to try to limit a state's right to manage air pollution within its own borders," Andrew Linhardt, the Sierra Club's deputy legislative director, told Bloomberg. "These clean car standards are popular among the public, and they're working. The only people who would benefit from this backwards policy are car manufacturing executives who want to put America's climate progress in reverse."

The Obama administration sought to "lock in" the rules by announcing in January 2017 the completion of a "midterm review" to determine the feasibility of the 2022-2025 model year rules ahead of an April 1, 2018 deadline.

In March 2017, Trump announced he would reopen that review and suggested he would soften the mandates. "The assault on the American auto industry is over," he told autoworkers in Michigan.

Reporting by David Shepardson

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