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Trump’s review of car fuel standards could lead to fight with California, environmentalists

President Donald Trump speaks during a round table discussion at the American Center of Mobility, Wednesday, March 15, 2017, in Ypsilanti Township, Mich. From left are, GM CEO Mary Barra, the president, UAW President Dennis Williams and Ford CEO Mark Fields. (AP Photo/Evan Vucci)
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President Trump opened the door Wednesday to rolling back fuel efficiency standards that were adopted during the Obama administration, a move that could lead to a legal fight with state regulators and environmental groups in the coming years.

In January, the Environmental Protection Agency reaffirmed that automakers must achieve an average 54.4 mpg across their fleets by 2025. But Trump pledged Wednesday to review those standards in a speech at the American Center for Mobility in Ypsilanti, Mich. He told auto plant workers there that his administration will ensure the regulations do not lead to job losses and factory closures.

“Were going to work on the [fuel] standards so you can make cars in America again,” Trump said. “We’re going to help the companies and they’re going to help you.”

The announcement does not change existing regulations, but Democrats and environmentalists fear it signals the administration’s desire to weaken rules they view as critical to reducing greenhouse gas emissions.

They also worry the administration could eventually target an EPA waiver that allows California and a dozen other states to set stricter emissions standards than the federal government. Automakers will still be compelled to produce more fuel efficient cars so long as the regulations in California, the country’s largest car market, remain in place.

“Making this U-turn on fuel economy is the wrong way to go for our security, economy and environment,” Sen. Ed Markey (D-Mass.) said in a statement Wednesday. “Undoing the fuel economy standards will also lead to costly litigation and create needless uncertainty for the auto industry, threatening the economic and employment gains automakers have made in recent years.”

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The three major entities that regulate automobile emissions — the EPA, National Highway Traffic Safety Administration and California Air Resources Board — agreed to the fuel economy standards in 2012 and vowed to conduct a review in 2017 and 2018 to determine whether they remained technologically and economically feasible. The current standard is 35.5 mpg.

Last year, the EPA determined the industry was on track to reach the goal and that the standards remained appropriate. After Trump’s election in November, the agency moved to make that judgment final ahead of schedule despite the industry’s request to adhere to the review’s original timeline.

Even before Trump’s announcement, the Auto Alliance, a trade association, challenged the EPA ruling in court, claiming it was “arbitrary and capricious” and exceeded the agency’s legal authority. California filed a motion late Tuesday in support of the EPA’s decision, and other states have indicated they will do the same.

Trump criticized the Obama administration for expediting its review of the standards, and a senior White House official said Tuesday that the EPA ignored “a voluminous record of data” when it reached its conclusion.

The EPA formally rescinded that decision on Wednesday.

“If the standards threatened auto jobs, then common sense changes could have and should have been made,” Trump said.

Prior to the speech, Trump toured a display of vehicles made in the U.S. by a variety of automakers. He then met with auto executives who took turns pitching Trump on the efforts their companies are making to build vehicles in America.

[Donald Trump tells Detroit auto CEOs that environmental regulations are ‘out of control’]

UAW President Dennis Williams, who also attended the meeting, told Trump “we have to deal with the environment and we have to do it in a responsible way.”

Trump nodded and replied that he agreed “100 percent,” adding that he didn’t believe lower standards should prevent automakers from making new cars.

“If it takes an extra thimble of fuel, we don’t want that to stop you,” Trump said.

Automakers eagerly welcomed the announcement. Many contend that the regulations place a financial burden on automobile makers, which is likely to result in either employee layoffs or more expensive cars.

“After all, these decisions impact the more than 7 million Americans dependent on autos for employment, as well as the driving public seeking affordable transportation,” Mitch Bainwol, president and CEO of the Auto Alliance said in a statement.

Rebecca Lindland, senior director at Kelley Blue Book, said that meeting the existing standards will be “extremely challenging,” because sales of electric vehicles have been tepid and Americans are buying large numbers of less-efficient SUVs and trucks.

Automakers “would certainly like this standard to be more closely representative of what consumers are already buying,” Lindland said, adding that she expects the industry will continue to develop vehicles with more efficient combustion engines. “Consumers want the most fuel efficient version of a vehicle they already want to buy.”

Abby Phillip in Ypsilanti, Mich. contributed to this report.

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