Trump admin is mending friendships with carmakers

Source: Camille von Kaenel, E&E News reporter • Posted: Thursday, September 21, 2017

Posted alongside U.S. EPA’s explanation for reconsidering its vehicle pollution rules is a letter by an automaker asking the Trump administration to review the rules governing greenhouse gas emissions in cars.

The placement is unusual for an industry request and is just one example of how the current EPA has been seeking to go the extra mile to gratify an industry that felt shortchanged by the Obama administration.

Automakers went from standing and clapping with former President Obama in 2011 as he announced new tailpipe standards to lambasting his team in January for trying to lock-in the rules more than a year ahead of a scheduled review (Greenwire, Jan. 13).

From that day forward, EPA staff and new political appointees have sought to mend the relationship that once yielded one of the country’s most successful air pollution reduction programs, slated to roughly double the real-world fuel efficiency of cars and trucks from 2012 to 2025 to around 36 mpg.

Hanging over both sides is the threat of a protracted legal fight between California and the federal government over the state’s special authority to set more stringent standards, potentially plunging the industry into deeper uncertainty.

EPA is now taking public feedback until Oct. 5 on whether to change the standards for model years 2022 to 2025 (Climatewire, Sept. 7).

The decision to include the letter from the Alliance of Automobile Manufacturers on the EPA webpage that tracks Federal Register notices and regulatory decisions came directly from EPA Administrator Scott Pruitt’s office, according to documentsobtained by E&E News through a FOIA request. The webpage does not include any other comments from third parties.

It also does not include a letter by the Association of Global Automakers, the trade group representing the U.S. operations of international automakers, despite requests by its lobbyists. The group’s members generally make more fuel-efficient cars than those of the manufacturers alliance.

Gloria Bergquist, a spokeswoman for the alliance, said she’s pleased EPA and the National Highway Traffic Safety Administration were jointly reviewing the rules.

“The White House is fulfilling its commitment to reinstate the [midterm evaluation],” she said.

The midterm review, scheduled for completion in April 2018, was a crucial concession in their 2011 deal with President Obama.

In an interview with E&E News this month, former EPA Administrator Gina McCarthy called the deft negotiations with automakers one of the shining moments of the Obama administration’s policymaking on climate change.

In January, she defended her surprise decision to accelerate the review by citing EPA’s extensive technical record, which found that automakers could meet the standards through 2025 at lower costs than anticipated and with existing technologies.

The Alliance of Automobile Manufacturers’ letter posted on EPA’s webpage calls the Obama administration’s Jan. 13 decision to keep the rules for model years 2022 to 2025 unchanged “the product of egregious procedural and substantive defects” and “riddled with indefensible assumptions, inadequate analysis and a failure to engage with contrary evidence.”

Automakers had wanted EPA to consider how cheap gasoline and Americans’ love of inefficient trucks make it harder to meet the stringent rules.

President Trump announced in March that he would undo the Obama-era decision and reopen the standards. He met twice with the CEOs of General Motors Co., Fiat Chrysler Automobiles NV and Ford Motor Co. No such presidential meeting had occurred since Obama stood with them to announce the standards nearly a decade earlier.

Behind the scenes, staff has also been reaching out to automakers.

Automakers and EPA staff have long worked closely together at the agency’s lab in Ann Arbor, Mich. It employs more than 400 scientists and engineers, just a few miles from the headquarters and research and development centers of Detroit’s automakers (Climatewire, May 11). Many of the staff have done a stint in the industry.

Those ties have soured because of the uncertainty from both the Obama administration’s decision to lock in the strict standards last spring, and the Trump administration’s move to reverse it.

Chris Grundler, a career staffer and director of the Office of Transportation and Air Quality, wrote to Mitch Bainwol, CEO and President of the Alliance of Automobile Manufacturers, on Jan. 17 to suggest there were other ways automakers could get relief from the stringent standards.

“I hope you saw as well that the Administrator’s [McCarthy] letter included a passage that said, in part, that her determination did NOT preclude future regulatory action designed to increase incentives and lower costs for advanced technologies,” he wrote in the email.

Bainwol responded that he did not think the offer was “necessarily meaningful.”

“But we understand it’s a new day,” he added.

Bill Charmley, director of the Office of Transportation and Air Quality’s assessment and standards division, acknowledged in an email to General Motors’ government affairs team in January that the “historical ability to work through the technical issues has been compromised by the EPA timeline on the [midterm evaluation] in November-January.”

“I would like to do what I can to repair that relationship,” he concluded.

Grundler told automakers at a major conference last month he had heard “loud and clear” their request that the agency consider markets and consumers, not just technology, when reviewing the standards. The expanded review has already brought in new datasets (Greenwire, Aug. 17).

EPA did not respond to a request for comment, and the automaker trade lobbies declined to discuss its communications with regulators.