The Car Industry Squirms, as It Gets What It Asked For

Automakers spent months lobbying the Trump administration to weaken the EPA’s clean-car standards. But they’re not sure they wanted them that weak.

President Donald Trump talks with Mary Barra, chief executive officer of General Motors, at a March 2017 event. (Jonathan Ernst / Reuters)

On Thursday, the Trump administration announced that it would weaken the country’s clean-car standards, which regulate how much air pollution can be emitted from car tailpipes.

The proposal, which would take effect in 2020, would eliminate the federal requirement that new cars and light trucks get more fuel efficient on average every year. Instead, it would freeze the fuel-economy standard at about 29 miles per gallon until 2025. This is, by any measure, a big concession: The Obama administration once mandated that new cars and trucks average about 43 miles per gallon by that same year.

No one should have been happier about this change than the car industry. Since the day after Donald Trump’s election, carmakers have begged him to weaken the fuel-economy standards. But on Thursday, the car industry seemed subdued. The Auto Alliance—which lobbies for the “Big Three” U.S. automakers, as well as Toyota, Volkswagen, and Mazda—did not immediately hail the rollback as a triumph for American business.

“With today’s release of the administration’s proposals, it’s time for substantive negotiations to begin,” said Gloria Bergquist, a spokeswoman for the Alliance, in a statement.

In coded but unmistakable language, the Alliance asked the Trump administration not to explicitly freeze the standards at 2020 levels, as it was proposing to do:

Automakers support continued improvements in fuel economy and flexibilities that incentivize advanced technologies while balancing priorities like affordability, safety, jobs, and the environment. … We urge California and the federal government to find a common-sense solution that sets continued increases in vehicle-efficiency standards while also meeting the needs of America’s drivers.

(Bolded emphasis in the above paragraph is mine.)

The automakers aren’t asking for the old standards, to be clear: They want looser rules and more generous accounting. Nor are they rejecting the proposal, exactly. They have not taken on the stern language of a coalition of consumer advocates, environmental groups, and public-health nonprofits who have denounced the new rules. Automakers did not mention, for instance, that the new rules could emit as much greenhouse gas as is released today by the 70 smallest countries on Earth.

But automakers do want the national miles-per-gallon requirement to increase every year. In this, they may seem to be striking a sensible, savvy middle-ground position: neither this, nor that.

But we’re only here—and the U.S. is only rolling back the rules—because of the Auto Alliance’s concerted lobbying. For more than a year after Trump’s inauguration, the Alliance publicly bludgeoned the fuel-economy standards, beseeching the administration to withdraw them. Now, it’s gotten what it said it wanted—and it isn’t sure it likes it.

How did it get in this mess? It starts in January 2017, a week before Trump took office. That’s when the Environmental Protection Agency announced its long-standing fuel-economy rules would stay in place through 2025. Though the agency had first issued the rules in 2012, and had spent years preparing to affirm them, Obama officials rushed the schedule to publish them before Trump’s inauguration.

Automakers felt cheated. The next month, they sent a letter to the Trump administration. It warned that the standards “threaten to depress an industry” and said the EPA “should withdraw” them. They followed it up with months of in-person charm. During the spring and summer of 2017, auto executives met regularly with Scott Pruitt, the then-EPA administrator. A Toyota vice president drove Pruitt around in a $100,000 Lexus. (The jaunt was not revealed to the public at the time.)

As 2018 arrived, the Auto Alliance even pushed junk science, questioning in a legal document whether tailpipe pollution causes early deaths. (Decades of research has found that it does.) The Alliance also quoted legitimate studies out of context, implying that climate scientists “tune” their models to arrive at certain outcomes and that global warming does not exacerbate drought or hurricanes.

Then, right around March of this year, automakers tapped the brakes. Perhaps officials in the Department of Transportation—which writes the fuel-economy rules with the EPA—signaled by that point that they wanted not just to loosen the rules, but to freeze them altogether. In any case, individual automakers began to dissent. Ford, whose executives have made climate change central to the company’s public image, suddenly took the time to speak up.

“The cost of believing [climate change] is not real is just too high,” wrote Bill Ford, the company’s chairman, in a Medium post at the end of that month. “We support increasing clean-car standards through 2025 and are not asking for a rollback.” (Ford’s nuts-and-bolts record on climate change is mixed. The company has stopped selling its most fuel-efficient cars—its sedans and hatchbacks—in the United States, but it is also investing $11 billion in new hybrid and electric vehicles.)

In April, the whole industry jammed the machine into reverse. The president of the Auto Alliance told Congress that he didn’t want the standards to freeze, even though he had once said the EPA should “withdraw” the rules. And carmakers wrote a new letter to the White House, which beseeched the president from the other direction: “Climate change is real, and we have a continuing role in reducing greenhouse gases and improving fuel efficiency.”

“It’s sort of a case where the dog actually caught the bus,” Jack Gillis, a researcher at the Consumer Federation of America, told me at the time. “Now what are they going to do?”

They’re going to diplomatically equivocate, apparently. Asked to comment on this week’s proposal, a Ford spokesman referred me to the Auto Alliance statement. General Motors gave a similarly milquetoast comment to The Detroit News. The Alliance did not respond to a further request for comment regarding some of the claims in this article.

And despite their statements, it’s not clear that carmakers actually dislike the new proposal. Even if automakers care about climate change, the proposed rules will probably save them a lot of money.

Sam Ori, the executive director of the Energy Policy Institute at the University of Chicago, believes that car companies are bluffing. “The bottom line is just that industry wants the lowest costs possible,” he told me in June. “They’re concerned about the public-image aspect of this. They’re concerned that everyone’s going to see they’re self-interested, that their image as environmental stewards will be tarnished.”

But automakers do have financial reasons to fear controversy over the standards. Since 1970, the Clean Air Act has allowed California to issue stricter tailpipe-emissions rules than the EPA. California has technically used this law to enforce its own fuel-economy rules since 2012—but its requirements are identical to the federal government’s, creating one de facto national rule.

In the proposal, the Trump administration weakens the federal standards while revoking California’s power to issue stricter rules. The state has sued in response. If the Supreme Court rules that California can enforce its own fuel-economy rules, then the U.S. car market would permanently split in two, and automakers would likely have to manufacture lighter, more advanced vehicles for California.

Even if California loses, automakers could float for years in legal uncertainty, as they fight a complicated and unflattering court battle with the country’s most populous state. Since carmakers plan their product lines years ahead of time, even a relatively quick duel could upset their business plans deep into the 2020s.

Do automakers fear this uncertainty more than they fear the unchanged standards?

It may be too late for them to answer that question: They already chose their ally when they met with Pruitt, when they sent pleading letters to the president, and when they cited junk science in official documents. And if you look closely, there’s a rising awareness of this in the new Auto Alliance statement:

We urge California and the federal government to find a common-sense solution that sets continued increases in vehicle-efficiency standards while also meeting the needs of America’s drivers.

The emphasis isn’t mine: Common sense was also emphasized in the original statement. It’s the emphasis of the earnest exhortative: Come on, guys, we can work it out. In an administration keen to avoid costly controversies for its allies in business, such arguments might win out. But the automakers chose to lash themselves to the Trump administration, which has rarely let bad press stand in the way of a good culture war. Now auto executives are being taught what Trump-friendly NFL owners learned last year. It turns out that old song—the one you can still hear blasting from Mustang convertibles in any American suburb—didn’t tell the whole truth. Sometimes, you can get too much of what you want.