On August 2, 2018, Donald Trump tore up the deal struck between the Obama administration and automakers to reduce greenhouse gas emissions (GHG). Instead of increasing to 54 mpg by 2025, automakers could keep fuel efficiency standards at 36.9 mpg.
- Last year, the Trump administration released its plan to roll back all environmental protections established for automakers under the Obama administration.
- If the administration is successful, it could cost Americans $460 billion.
- Trump’s plan not only hits Americans hard in the wallet, it also could destabilize the auto industry.
More specifically, the Trump administration proposed rollback allows cars, SUVs and light-duty trucks to stay at 2020 levels for models 2021 through 2026. Once you dig down into the math, President Trump’s freeze on fuel-efficiency requirements could cost Americans billions. According to Consumer Reports, the existing standards, which apply to MY 2017 to 2025, would net Americans $660 billion in savings relative to standards in place for MY 2016. With the rollback, $460 billion of that savings goes bye-bye.
Volkswagen’s new scalable Modular Electric Drive (MEB) matrix. Photo: Volkswagen
You might think President Trump’s rollbacks would have automakers celebrating. Not the case. To build cars economically and competitively requires economies of scale. If the U.S. goes rogue, automakers will be forced to design vehicles to two different standards. And, that’s not financially feasible.
Automakers stand behind California
In fact, four large automakers just told the Trump administration how they feel about its proposed changes by striking an emissions deal with California. Since before its passage of the Clean Air Act in 1970, California has set its own, more stringent standards for emissions reduction with a waiver from the federal government to do its own thing.
If President Trump pushes through his plan, states would lose rights to set their own standards. This takes aim specifically at California. Currently, although states can’t set their own standards, they can adopt California’s policies. Fourteen states plus Washington D.C. have done so.
WHY THIS MATTERS
President Trump built his platform on saving Americans money and creating jobs. With his proposed rollbacks, the transportation industry would take a debilitating hit, walloping Americans hard in the wallet. Moreover, it could cost 500,000 jobs. And that’s not even getting into the price we will pay by not protecting our environment.