The Environmental Protection Agency yesterday gave General Motors Corp. and Ford Motor Co. a major victory in their battle to lower federal fuel economy standards for new-car fleets.
The EPA did not relax regulations. It simply gave the two car companies, the nation's biggest, extra credits for fuel-economy performance over the last five years.
The credits effectively put GM and Ford in compliance with federal fuel-economy rules through 1984.
The extra points also reduce by millions of dollars the possible penalties facing GM and Ford for failing to meet the 1985 corporate average fuel economy (CAFE) standard of 27.5 miles per gallon. GM is 2.4 mpg below and Ford is 1.6 mpg under that level.
GM and Ford last March asked the Department of Transportation -- in separate petitions filed with the National Highway Traffic Safety Administration -- to lower the 27.5 mpg requirement to 26 mpg for new-car fleets, beginning with those manufactured for the 1986-model year.
EPA's actions come only a few days before DOT is expected to rule on those petitions. The environmental agency said that the extra credits are justified because GM and Ford had been unfairly penalized because of errors in the 1975 EPA test procedure.
The rules were called for in the 1975 Energy Policy and Conservation Act, an amendment to the Motor Vehicle Information and Cost Savings Act. The statute was enacted to curtail motor fuel consumption by forcing U.S. auto makers to develop more fuel-efficient cars.
"EPA has changed the test a number of times since then to improve its accuracy," the agency said in a formal statement yesterday. The law requires requires EPA "to grant . . . fuel economy adjustments to compensate" car companies that were judged not in compliance because of faults in the standards, the agency said.
GM and Ford officials had no immediate comment yesterday on EPA's decision. But the response from critics of the efforts to roll back CAFE standards was swift and harsh.
"EPA has done DOT's dirty work by privately relaxing the CAFE standards," said Clarence Ditlow, director of the Washington-based Center For Auto Safety, which has been pushing for tougher CAFE rules.
Ditlow said that because of EPA's actions, GM will have finished the 1984-model year with $36 million worth of fuel-economy credits instead of the $260 million in penalties the company should have had to pay.
Under the law, penalties are calculated at $5 for each tenth of a mile per gallon an auto maker falls below the effective CAFE standard. That penalty is multiplied by each car in an auto maker's new-car fleet, regardless of whether an individual car's fuel consumption meets the standard.
EPA credited GM with an extra 0.7 mpg for 1980, 0.6 for 1981, 0.4 for 1982, 0.5 for 1983 and 0.3 for 1984. CAFE credits are good for three years from time accrued. The combined effect of GM's credits is to make the company good with the law through 1984, with some money remaining to cushion noncompliance in 1985.
Ford gains an extra $100 million in CAFE credits as a result of EPA's changes, according to an analysis done by Chrysler Corp., the loudest corporate critic of the effort to reduce the CAFE standard.