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Automakers Reach Emissions Deal With California, Spurning Trump

Shunning the Trump administration’s push to weaken Obama-era fuel efficiency standards, a group of automakers said Thursday they have reached a deal with California to produce more fuel efficient and electric vehicles.

SACRAMENTO, Calif. (CN) – Shunning the Trump administration’s push to weaken Obama-era fuel efficiency standards, a group of automakers said Thursday they have reached a deal with California to produce more fuel efficient and electric vehicles.

The announcement by Ford, BMW, Honda and Volkswagen signals a major victory for California in its fight with the Trump administration over vehicle emissions, as the four automakers account for nearly 30% of U.S. auto sales. In exchange for more time to meet existing mileage and emissions targets, the automakers have agreed to extend California’s standard nationwide.

California Gov. Gavin Newsom tied cleaner cars to the fight against global warming and called the deal a win for the state’s economy and the planet.

“Few issues are more pressing than climate change, a global threat that endangers our lives and livelihoods. California, a coalition of states, and these automakers are leading the way on smart policies that make the air cleaner and safer for us all,” Newsom said in a statement. “I now call on the rest of the auto industry to join us, and for the Trump administration to adopt this pragmatic compromise instead of pursuing its regressive rule change.”

Over the last year the Trump administration has been pushing to weaken current federal emissions standards – a product of negotiations between California, automakers and the Obama administration in 2013 – in hopes of allowing automakers to produce cheaper cars. It believes the current standard sets an unrealistic fuel mileage target for automakers.

Trump’s proposal would freeze President Barack Obama’s 50 mpg standard by model year 2026 in favor of an average of 37 mpg.

State officials have countered that a rollback of federal vehicle emission standards could wipe out decades of progress the state has made to improve its notoriously smoggy air and have threatened to sue if the Trump administration adopts weaker laws. While California has been allowed to set its own vehicle emissions standards since the 1960s, the administration could choose to revoke the state’s federal waiver.

Hopes of a compromise shattered in February after the White House accused the California Air Resources Board of failing to produce viable alternatives to the administration’s 50-state standard, and ended talks with the state.

The U.S. Environmental Protection Agency called Thursday’s deal a “stunt” and said it will continue pursuing one national standard.

“This voluntary framework is a public relations stunt that does nothing to further the one national standard that will provide certainty and relief for American consumers” EPA spokesperson Michael Abboud said in a statement.

The deal comes one month after 17 automakers signed a letter urging the White House and California to work on a single standard. The companies warned the dispute over fuel-mileage standards has created uncertainty for the auto market.

The California agreement will give automakers an additional year to meet the Obama-era fuel mileage target and allows them to gain credits for producing more electric vehicles. The state will also streamline the approval process for new clean air technologies. In addition, the four companies will commit to implementing California’s standard nationwide if the Trump administration adopts less stringent standards.

The participating automakers said the compromise gives them “regulatory certainty” in case the sides don’t come to terms and allows them to stay in California’s lucrative market.

“As a leader in producing efficient, low- and zero-emission vehicles, Honda believes this is a win for our customers and for the environment," Honda said in a statement.

Environmental groups painted the agreement as a win for states’ rights and the environment.

“This announcement reaffirms the authority of California – and every other state – to set eminently achievable vehicle pollution standards that protect the public and curb carbon pollution,” said Luke Tonachel, director of clean vehicles and fuels at the Natural Resources Defense Council, in a statement.

An auto industry group that represents some of the signatories viewed the agreement as proof the Obama-era standards should be replaced and said they are looking forward to one national standard.

“A final federal rule regarding future [efficiency] standards has yet to be released and automakers continue to seek an optimal pathway forward that meets the diverse needs of our customers while providing environmental improvements, preserving safety and auto jobs and keeping new vehicles affordable for more Americans,” the Alliance of Automobile Manufacturers said in a statement.

While California has slashed total greenhouse gas emissions in recent years thanks largely to utilities shifting to clean energy, transportation emissions have actually increased. Californians are driving more and tailpipe exhaust from cars and heavy-duty vehicles continues to make up the largest piece of the state’s pollution pie, followed by the industrial sector and electricity producers.

California claims the deal will deliver the same greenhouse gas reductions over five years as the Obama standards required in four. Gov. Newsom says the framework sets a standard for other states to adopt and that the deal is open to other automakers.

“California’s authority to set tough vehicle emission standards has been good for California and the country,” said Newsom. “This agreement affirms the fact that retaining that authority is a crucial element in our ability to make progress with cleaner cars.”

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