By on January 10, 2022

General Motors has issued a letter to California Governor Gavin Newsom promising that the automaker is now fully committed to complying with the state’s aggressive emission regulations. This follows an earlier announcement from GM advancing plans to eliminate tailpipe emission from all light-duty vehicles by 2035 via electrification. The company had also increased global spending to develop EVs to $35 billion (USD) through 2025, which is roughly a third more than it had previously been targeting.

Of course, don’t think this has anything to do with altruism or formal commitments to some grand cause. California was simply planning to bar any automakers that hadn’t previously vowed to adhere to its strict regulatory policies from selling to state government fleets. While GM has been in the process of changing its allegiance, the business originally sided with automakers approving of the Trump administration’s regulatory revisions that were at odds with the region. 

According to Reuters, the automaker has confirmed that its decision to become friendlier toward the State of California has made it eligible for government fleet purchases. Frankly, I’d criticize GM for kissing the ring to receive preferential treatment but there’s not much point. General Motors CEO Mary Barra has taken every position imaginable during our Gas War coverage and it’s not all that uncommon to see corporations bowing to government actors to get something in exchange.

Let’s take a look back to see how we got here.

In the days following President Donald Trump’s arrival at the Oval Office in 2017, Barra visited the White House with lead executives from Ford Motor Co. and Fiat Chrysler Automobiles (now Stellantis) to request the fueling rollback that would ultimately divide the industry. The State of California immediately became a rallying point for other states that likewise wanted to retain the stricter Obama-era regulatory rules pertaining to nationwide emissions and the Corporate Average Fuel Economy (CAFE). Court cases were launched and the following years offered seemingly unlimited examples of how childish and uncooperative government officials can be.

Back in 2017, American automakers claimed they couldn’t keep up with the emissions quotas under Obama without going bankrupt and Trump believed a rollback would pair well with his focus on lowing fuel prices by encouraging localized pumping. The White House also stated it was attempting to retain existing automotive jobs (as EVs require less physical labor to produce) and provide American consumers with greater choice by delaying regulatory provisions that would eventually make larger vehicles boasting V8 power harder to come by.

California insisted that it was within its rights to establish its own regulatory rules with state leadership explaining a desire to retain — if not surpass — the Obama-era targets the Trump administration was actively trying to scale back. However, this decision effectively set up the Golden State to have control of industry. California is responsible for selling more cars than anywhere else in the nation and, with stricter rules, it would be the region automakers would need to comply with in order to maximize volume in North America. But state officials, like Gov. Newsom, promised that stricter regulations would result in cleaner air and a deluge of high-tech American jobs as automakers transitioned toward electric vehicles.

As a result, Trump and company wanted to remove California’s ability to self-regulate. Meanwhile, California was building a coalition of like-minded states vowing to adhere to its emission laws — regardless of what the federal rules were. The ensuing legal battles were really something, with many public officials flat-out refusing to talk to each other because they were on different sides of the argument. California even managed to get a handful of automakers (BMW, Ford Motor Co., Honda Motor Co., and Volkswagen Group) to publicly promise that they would adhere to its proposed emissions requirements instead of what was coming out of Washington.

By November of 2020, the Trump rollbacks had been repeatedly softened in a misguided attempt to compromise and California had given up on fighting with the federal government because it looked like Joe Biden was to assume the presidency in 2021. His environmental plan was exactly what the Californian Air Resources Board (CARB) said it wanted, a strengthening of the emission proposals launched when he was still vice president.

General Motors took notice, with CEO Barra flipping the script by formally abandoning the automaker’s lukewarm support of the Trump initiatives while prolonged ballot-counting swung the presidency in favor of Biden.

“President-elect Biden recently said, ‘I believe that we can own the 21st century car market again by moving to electric vehicles.’ We at General Motors couldn’t agree more,” Ms. Barra wrote in a letter to some of the world’s largest environmental groups. “We are inspired by the President-elect’s Build Back Better plan which outlines a clear intention to expand vehicle electrification in the United States, create one million jobs, install 550,000 charging stations, and position American auto workers and manufacturers to win the race for electrification.”

“We believe the ambitious electrification goals of the President-elect, California, and General Motors are aligned to address climate change by drastically reducing automobile emissions. We are confident that the Biden Administration, California, and the U.S. auto industry, which supports 10.3 million jobs, can collaboratively find the pathway that will deliver an all-electric future to better foster the necessary dialogue, we are immediately withdrawing from the preemption litigation and inviting other automakers to join us.”

Now GM is reiterating its newfound commitment to California by openly stating that it has the right to establish any vehicle emission standards it likes under the Clean Air Act. While this is technically true, the EPA under Joe Biden has already moved to restore California’s authority to set whatever rules it likes on automobiles in April 2021.

From Reuters:

In July, 16 Republican state attorneys general urged the EPA to reject reinstating California’s authority. “The Golden State is not a golden child,” they wrote.

GM previously backed overall emissions reductions in California’s 2019 deal with rivals Ford Motor, Volkswagen , Honda and others, but asked the Biden administration to give automakers more flexibility to hit carbon reduction targets.

California plans to ban the sale of new gasoline powered passenger vehicles starting in 2035, a step the Biden administration declines to endorse. Biden has called for 50 [percent] of new vehicles sold by 2030 to be electric or plug-in hybrid.

Last month, the EPA finalized here new vehicle emissions requirements through 2026 that reversed Trump’s rollback of car pollution cuts and will speed a U.S. shift to more electric vehicles.

So we’re kind of back where we started. Despite the Trump fuel rollbacks being front and center throughout his tenure, they did little but delay the Obama-era targets automakers claimed were untenable a few years earlier. Build Back Better may have failed in Congress. But there’s still a chance it could be pushed through and automakers have found themselves confronting a federal government that’s now broadly in line with aggressive Californian proposals.

With that in mind, it’s easy to see why General Motors and its CEO have attempted to play all sides. Most other companies are doing the same, taking a stand only when they think there’s a strong chance of getting their way or there’s no alternative but to fall in line. I suppose the lesson to take away is that governments are fickle and corporations even more so.

[Image: General Motors]

Become a TTAC insider. Get the latest news, features, TTAC takes, and everything else that gets to the truth about cars first by subscribing to our newsletter.

Get the latest TTAC e-Newsletter!

39 Comments on “Gas War: GM Now Sucking Up to California to Maximize Fleet Sales...”


  • avatar
    28-Cars-Later

    “confronting a federal government that’s now broadly in line with aggressive Californian proposals.”

    Not to be your editor, but destructive is a more accurate adjective here.

    • 0 avatar
      SCE to AUX

      One man’s terrorist is another man’s freedom fighter.

      The battle over states’ rights has been waged since before the US was born. It seems like everyone likes states’ rights until they don’t like the outcome. I agree their proposals are destructive, at least to some.

      I don’t know the right balance, and I’m no lawyer. But while California should have the right to regulate their local environment as they wish, they shouldn’t be allowed to swing the whole country their way. On the other hand, I favor a 50-state solution that simplifies matters for the mfrs and the consumers.

      The root of the problem may merely be California’s sheer size, and proposals to break it into 4 states (for example) have merit to me. Then we’d see less tug-of-war with Washington over such matters. It scares the youngsters when their college-age brother gets into a shouting match with mom and dad.

      • 0 avatar
        Matt Posky

        @SCE brings up a lot of important points here. I personally do not like Californian regulations and wouldn’t live there. But if the citizenry likes those laws and is happy with its officials that’s its business. My only real gripe is that CARB and Newsom are effectively using the state’s influence to force the issue on a national level. But even the Biden administration (which also has automotive proposals I think are untenable and anti-consumer) has said California’s timeline for EV bans are a bridge too far.

      • 0 avatar
        28-Cars-Later

        “One man’s terrorist is another man’s freedom fighter.”

        Sometimes a terrorist is just a terrorist, if their goal is destruction of others for political reasons other than some kind of liberation I can’t see any definition of “freedom fighter” being applied. The PRK isn’t occupied by a foreign power, it wants to project power onto others because it is the aggressor.

        “But while California should have the right to regulate their local environment as they wish”

        No, they lose it because 1. they abuse the privilege and 2. CARB was actually very successful in reducing emissions in the LA Basin and should have been disbanded in the 90s.

        @Posky

        “But if the citizenry likes those laws and is happy with its officials that’s its business.”

        Their rights end where mine begin.

        “But even the Biden administration (which also has automotive proposals I think are untenable and anti-consumer) has said California’s timeline for EV bans are a bridge too far.”

        Things are a tad SNAFU when Senator Joetard’s staff are the voice of reason. That really needs to be highlighted.

      • 0 avatar
        Socrates77

        California ain’t forcing anyone, Instead every other state have realize that you can’t stop the future (or progress) and they know they’ll fall behind if they don’t join progress. That’s why conservatives fight hard because they’re not visionaries by nature and they are losing their old monopolies.

    • 0 avatar
      Matt Posky

      I’m sure it’ll come up in a future opinion piece. But if you want the added context, I think most states are being run rather poorly with California holding a spot right at the tippy top of that list.

      • 0 avatar
        SCE to AUX

        Pennsylvania is a glass house, to be sure. Our gas tax – highest in the country – makes everything more expensive, and the roads no better.

        Not to mention the death grip of the D’s in Pittsburgh and Philadelphia, with unchecked corrupt shenanigans at the city and county levels mixed in with their respective school districts and sports teams.

    • 0 avatar
      Ol Shel

      Cons love a strong federal government… unless they’re talking about slavery.

  • avatar
    CKNSLS Sierra SLT

    Biggest vehicle market in the country-hard to ignore.

  • avatar

    Who Killed the Gasoline Car?

  • avatar
    SCE to AUX

    “prolonged ballot-counting swung the presidency in favor of Biden”

    Not sure what you meant here. There was never a count that favored the incumbent, just as there was never a count in the 2000 election that favored Gore.

    The people who think the 2020 election outcome was rigged don’t understand the statistical improbability that it was.

    “Possible” doesn’t mean “probable”, yet today it means “certain” to many people who want to believe. “Reasonable doubt” is a term that needs to be better understood.

    As for California and the automakers, your statement is true: “the lesson to take away is that governments are fickle and corporations even more so.”.

    • 0 avatar
      FreedMike

      fEeLINgZ iZ FaCtZ

    • 0 avatar
      Matt Posky

      I meant that it took several days longer than a typical presidential election and a majority of the relevant swing states all went to Biden as the last ballots came in. Nothing more and I’m pretty sure everyone who cares already has their mind up as the the validity of the 2020 election anyway. It’s 2022 and that’s not the point of this article.

      As for the rest, if there’s one thing I want my readers to take away from every article I’ve ever written its to remain perpetually skeptical of politicians, experts, and CEOs.

  • avatar
    Heino

    Bring back the GM EV-1! Lead acid batteries and all.

  • avatar
    Socrates77

    GM is so pathetic, the only reason they’re still in business is because the Taxpayers bail them out, and even after that they open more factories and build more cars outside the country. And they have nothing to offer but BS patriotism. Never been competitive in safety, reliability or value. Bye bye GM your greedy hypocritical ways of doing business are over.

  • avatar
    Astigmatism

    “For-profit company tailors products to largest market and potential customer.”

    FIFY.

  • avatar
    Luke42

    “California was simply planning to bar any automakers that hadn’t previously vowed to adhere to its strict regulatory policies from selling to state government fleets.”

    Yup. That’s how this works. It’s California trying to solve California’s problems. California trying to solve their own problems with minimal regard for the feelings of Texans or Illinoisans is completely normal behavior for a state government.

    “While GM has been in the process of changing its allegiance, the business originally sided with automakers approving of the Trump administration’s regulatory revisions that were at odds with the region.”

    Companies follow the regulations of the locales in which they do business, even if those regulations are inconvenient — and they figure out how to maximize their profits given the regulatory environment, whatever it is. This is completely normal behavior for a corporation.

    While it’s good to explain this to uninitiated readers, I’m not sure why Posky is pretending to be surprised about completely normal behavior from government and industry. [shrug]

    • 0 avatar
      SCE to AUX

      I’ll defend Matt here. :)

      I don’t think he’s pretending to be surprised. It’s the regulatory instability at the state and national levels that produces a difficult business climate.

      Sure, GM should cater to its local markets. But despite its external pandering posture, it’s gotta a be frustrating to not know how to plan for the future when your time window is merely the next election cycle.

  • avatar
    MitchConner

    Lived in California for close to 40 years. Watched it go from a pretty cool place to a hell hole run by incredibly stupid people who think they’re better than everybody else as they push their cockeyed ideas based on fantasy down everybody else’s throats.

    What’s scary is the worst of the worst, the Silicon Valley rich, have so much money they can throw it around on a national level. They ruined California — and they’re starting to ruin the rest of the country. The co-CEO of Netflix supports hands off DAs who won’t prosecute anybody because they’re supposedly victims of a racist judicial system. Well, some skunk who should’ve been locked up for life yet was repeatedly let out wound up killing his own wife’s mother in her Beverly Hills home. Oops.

    BTW, the state has another huge surplus. Think Newsom is spending any of it on more reservoirs and desalination plants because he’s always screeching about droughts caused by climate change? Nah. But there’s $4.5B for a completely useless bullet train. Yet the dopes who live there just keep electing every donkey that comes along with a D next to their name.

    Trust me when I tell you that if California and its rectally inserted cranium, fiscally illiterate electorate thinks something is a good idea DO THE OPPOSITE. The state’s poverty rate is off the charts. Its quality of life stinks. The middle class is gone. Its pandemic recovery is amongst the worst of any state thanks to county health directors who were all trying to out stupid each other with their closures and lock downs. The taxes and fees are astronomical — and downright criminal when you look at the services you get in return. Litter strewn streets. Third world schools in all but the wealthiest enclaves. Overpaid government union goons who will rally to take anyone out who doesn’t cave to every one of their demands. Abusive regulations that punish businesses for minuscule environmental gains while the Chinese belch as much filth in the air as they want. And those forest fires? Predicted by scientists in the 90s thanks to zealots like the Sierra Club who didn’t want dead trees killed by a beetle infestation removed.

    No wonder GM thought jumped on board this bag of flatulent hot air. They’re just as dumb as that state.

    • 0 avatar
      Matt Posky

      I had a similar, though less intense situation on the other coast. Loved the city but it became clear that the city could no longer love me. Hope you found a better place.

      • 0 avatar
        28-Cars-Later

        @Posky

        I just saw a video Louis Rossman posted before Christmas regarding Toyota’s announcement it would be holding the remote start hostage for subscription on *existing* vehicles back to MY18 or 19. Maybe I missed it a few weeks ago but I had not heard about this until now.

      • 0 avatar
        MitchConner

        @Matt Moved to the Atlanta metro 13 months ago. Superior in every way, shape, and form. Feel reborn to be honest.

        In California the registration for my three cars alone was $1500 a year. Here? $135 — including $75 for the spay and neuter option.

        I see litter getting picked up weekly around here even though there isn’t much of it. In Silicon Valley there was a bumper from a Fusion laying in the bushes within sight of Google’s headquarters for six years when I left.

        Funny how you mentioned how you loved a place yet it didn’t love you back. That’s how I feel about California. Really used to love it. In return I got the equivalent of a girlfriend who’d take my cash, run up my credit cards, drink my booze, bang the neighbors, and go on benders that’d trigger visits from the cops once a quarter.

        Enough of that misery.

  • avatar
    BSttac

    GM is a parasite. Never forget that this company tries to get out of paying the victims families who died from the ignition switch scandal during bankruptcy. Scum organization that I wish the worse

Read all comments

Back to TopLeave a Reply

You must be logged in to post a comment.

Recent Comments

  • SCE to AUX: Another component of EV satisfaction related to expectations is this: Mfrs tend to embellish EV range,...
  • eggsalad: “One might surmise that a car/motorcycle (car-a-cycle?)…” I believe the current legal...
  • Fred: These companies gladly excepted the rule that they couldn’t be sued for covid, but they don’t...
  • Matt Posky: All this link does is show that the CTA supports government mandates. Its mention that truckers are...
  • Irvingklaws: These things always look to me like a high-tech chariot pulled by two jet skis. The 3 wheel arrangement...

New Car Research

Get a Free Dealer Quote

Who We Are

  • Adam Tonge
  • Bozi Tatarevic
  • Corey Lewis
  • Jo Borras
  • Mark Baruth
  • Ronnie Schreiber