Automakers Formally Take Aim at California's Zero-emission Vehicle Mandate

Matt Posky
by Matt Posky
automakers formally take aim at californias zero emission vehicle mandate

Compared to the rest of the United States, California is on the bleeding edge of government-appointed environmentalism. When the Trump administration suggested reexamining Obama-era fuel economy and emissions standards, The Golden State was the first to complain, saying it would not be adjusting its goals just because the rest of the country may. It also has pretty serious mandate on zero-emission vehicles — one that forces 15 percent of all new vehicles sold in the state to use zero-emission powertrains by 2025.

While California isn’t alone — nine other states have followed its lead since Trump took office — it is the keystone star on America’s flag pushing to maintain expand fuel regulations. Automakers have noticed and, despite previously having agreed with President Obama’s emission standards several years back, they’re launching a counter-offensive.

Arguing before a U.S. House panel, the Association of Global Automakers complained that California’s ZEV mandate threatens a single national standard for fuel economy.

On the one hand, the state seems impossibly ravenous for electrification and green solutions. On the other, most automakers have promised widespread electrification by 2025 anyway — so it shouldn’t really matter. But it does matter, and John Bozzella, president of the Association of Global Automakers, who told the House Energy and Commerce Committee why.

“The ZEV program produces no incremental nationwide [greenhouse gas] emission benefits despite the high burden placed on vehicle manufacturers. Current corporate average fuel economy and GHG emissions standards already specify each manufacturer’s total fleet-wide emissions, and therefore, in a system that averages together all vehicles in a manufacturer’s fleet, the fleet-wide emissions standards act as a cap when combined with an overall compliance fleet strategy,” he explained.

Automakers had previously changed their tune on corporate average fuel economy (CAFE), stating that the 2022-25 model year standards didn’t take into account compliance costs and lower-than-anticipated fuel prices. A 54.5 mpg average may be less feasible when gas is under $3 per gallon and everyone wants a crossover or SUV. (In its technical assessment report, issued before the 2016 decision to maintain existing CAFE targets, the EPA stated that current technological trends have light-duty vehicles on track to hit roughly 51 mpg by 2025.) But the Trump administration may move the goalpost even closer to appease manufacturers.

However, it’s worth mentioning that automakers have to take into account mandates from the EPA, NHTSA and California’s Air Resources Board. A separate ZEV quota for a handful of states complicates their strategy further. Looking at the situation from this angle makes manufacturers easier to sympathize with, and trade groups have made similar requests during NAFTA negotiations. The overriding theme here is for the government to keep things simple so manufacturing can stay predictable.

Of course, carmakers are also in the business of making money, and saving capital is just as good as generating revenue. According to Automotive News, Bozzella said the ZEV mandate has already cost the auto industry $24 billion.

“Manufacturers are also offering consumers massive incentives — in some instances as high as tens of thousands of dollars — to get them to buy electric-drive vehicles. The reality is that consumers are not embracing these technologies at the desired or projected rates, especially in states that are not investing sufficiently in the charging and hydrogen infrastructure needed to support the vehicles,” Bozzella told the House Committee.

Last year, EV sales didn’t make up one percent of the total new vehicle market. But California and several other states are bent on putting millions of zero-emission models on the road by 2025. Alliance of Automobile Manufacturers President Mitch Bainwol says he’s concerned consumers wouldn’t even buy advanced fuel-saving technologies if gas prices remained low.

He’s also disagreed with the EPA’s 2016 assessment that manufacturers should be able to meet the fuel mandates with advanced gasoline vehicles, citing a study by SAE International, Novation Analytics, and the Oak Ridge National Laboratory, that estimates just about every vehicle sold in the U.S. for the 2025 model year will need to be a hybrid to hit the mark.

Obviously, environmental groups oppose the suggestion that these regulations are too hard on manufacturers. Andrew Linhardt, deputy legislative director for transportation at the Sierra Club, said automakers were hypocritical to go after the ZEV program — especially considering “they are not doing any of the work to sell those vehicles.”

Likewise, Margo Oge, former director of the EPA’s Office of Transportation, stated she was “surprised and disappointed to see testimony from car companies attacking the importance of the ZEV mandate and how it is putting a burden on [said] car companies.”

(Correction: A previous version of this story stated that federal Corporate Average Fuel Economy (CAFE) targets had been lowered to roughly 51 mpg by the target year of 2025. Actually, the findings of last year’s technical assessment report stated that current trends would see the U.S. light duty vehicle fleet average 50-52.6 mpg by 2025. The preexisting 54.5 mpg target still stands. This story has been updated to reflect this.)

[Image: Volkswagen Group]

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  • SilverCoupe I am one of those people whose Venn diagram of interests would include Audis and Formula One.I am not so much into Forums, though. I spend enough time just watching the races.
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