Trump’s EPA targets the key rules for vehicle pollution. What it means for manufacturers
DETROIT – The plan of the Environmental Protection Agency this week to soften the rules aimed at cleaning automotive tail pipes is the last Trump administration decision to cancel the incentives for car manufacturers to become electric.
As part of a higher effort to cancel the climate-based government regulations, the EPA said on Tuesday that it wanted to revoke the 2009 conclusion that carbon dioxide and other greenhouse gases endanger health and public well-being. This would paralyze the legal basis to limit emissions of things such as power plants and motor vehicles.
The massive law and the expenditure law of President Donald Trump already targets incentives to the VE, in particular the imminent abolition of a credit which allows buyers of $ 7,500 on a new electric car.
The tax law approved in early July also includes another provision which will strike Tesla and other manufacturers of electric vehicles in the portfolio – the repeal of fines for car manufacturers who do not meet the federal standards of the fuel economy.
Car manufacturers can buy credits as part of a trading program if they do not meet mileage standards. EV manufacturers like Tesla, who are not based on gasoline, earn credits that they can sell to other car manufacturers. The arrangement has resulted in billions of dollars in income for Tesla and millions for other electric vehicle manufacturers like Rivian.
All this should disappear under the new law.
Trump has also challenged federal money on electric vehicle billing infrastructure and blocked California’s ban on new gas vehicle sales.
This adds less pressure to car manufacturers to continue to evolve their production far from gas vehicles. And this is significant because transport – which also includes ships, trains and planes – is the sector that contributes most to the global warming emissions in the United States
Strict exhaust pipes and mileage rules were part of the Biden administration’s commitment to clean the country’s vehicles and reduce the use of fossil fuels by encouraging the growth of electric vehicles. Electric vehicles do not use petrol or emit greenhouse gases.
The Trump administration and the automotive industry said the two rules were unreasonable for manufacturers.
Car manufacturers could comply with the EPA exhaust pipe limits with approximately 56% of new electric vehicle sales by 2032 – they are currently around 8% – with at least 13% rechargeable hybrid or other partially electric cars, and more efficient petrol cars that obtain more kilometers in the Gallon.
The latest mileage objectives set under the Biden administration forced car manufacturers to reach an average of approximately 50 miles (81 kilometers) per Gallon for light vehicles per year model 2031 and around 35 miles per gallon for microphones and vans per year model 2035.
But the secretary of the Ministry of Transport, Sean Duffy, put pressure on the National Highway Traffic Safety Administration earlier this year to reverse the rules, and recently declared that the inclusion of Biden of electric vehicles in their calculation was illegal. The NHTSA will reset them or will probably weaken them.
Then there are the fines that car manufacturers will no longer be faced not to fail on the rules of the fuel economy.
“With the signing of the only large magnificent invoice, new penalties for car manufacturers who do not comply with an illegal fuel economy standard designed to push electric vehicles will be zero,” said NHTSA spokesperson Sean Rushton in a statement.
Some inherited car manufacturers have paid hundreds of millions of dollars in penalties so as not to have met them. Last year, Jeep-Maker Stellantis paid $ 190.7 million for the 2019 and 2020 model years, and General Motors paid $ 128.2 million for the 2016 and 2017 models.
Car manufacturers who did not meet standards could also buy credits from car manufacturers who have made – or even exceed them – like Tesla. This provision reported Tesla $ 2.8 billion in 2024 – Income that he will no longer see.
Elon Musk brutally criticized the big tax bill and spends in June, saying that he “gives documents to the past industries while seriously naming the industries of the future”. Tesla did not immediately respond to a request for comments on the effect of the law on these credits.
The agency wrote to car manufacturers earlier this month, informing them that sanctions would not be issued from the 2022 model year. Some car manufacturers have confirmed that they have received the letter but refused to comment more.
Experts say that without them, the law “invites car manufacturers to deceive the rules of the government’s fuel economy by fixing fines at $ 0, ensuring that consumers will buy more gas guzems, will pay more to pump and enrich the big oil,” said Dan Becker, director of the Center for Biological Diversity Climate Transport Campaign.
Ann Carlson, professor of environmental law at the University of California in Los Angeles, and former interim administrator of the NHTSA under Biden, described it as a “astonishing decision” for the NHTSA to forgive essentially fines from 2022. She said that this was equivalent to a windfall for companies that have chosen to pay penalties rather than producing more effective cars.
Carlson said that safeguarding future fines “also poses a dilemma for car manufacturers who may feel obliged to comply with the law, even if there is no financial consequence so as not to do so”.
It takes some time to car manufacturers to move their product ranges, and experts say that car manufacturers could be locked in their technology and their manufacturing decisions for the next years of model. But the changes could occur for the 2027 model year and beyond, they said.
Electric vehicles are not as profitable as gas motor cars, so car manufacturers can do less if they no longer have to compensate for emissions from their petrol models. Already, some car manufacturers have backed up on their ambitions to go all electric with a slower rate of sales growth of electric vehicles.
“Car manufacturers also know that each presidential administration ends its end, so that they do not abandon their development efforts of VE,” said Karl Brauer, executive analyst at Iseecars.com. “But they will reduce their short -term efforts in this area.”
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Alexa St. John is a journalist by Associated Press Climate. Follow it on x: @alexa_stjohn. Join her at ast.john@ap.org.
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