The EPA and the National Highway Traffic Safety Administration (NHTSA) have for the past decade jointly set the greenhouse gas emissions and fuel economy standards. The joint national program, first announced by Obama^[6] in 2009, came on the heels of the auto industry bailout and was welcomed by automakers.

The national program also aligned with stricter clean vehicle standards sought by California^[7], which has authority^[8] under the Clean Air Act to adopt its own vehicle emissions standards.

Now automakers, though they had initially lobbied the Trump administration for weaker standards, could face more uncertainty especially given California’s legal challenge to the federal government’s revocation of its Clean Air Act authority. Several automakers including Ford, Honda, BMW of North America, and Volkswagen Group of America agreed last year^[9] to adhere to California’s more stringent vehicle standards, while a coalition of other automakers backed the Trump administration^[10] in the lawsuit, thus dividing the auto industry.

The new SAFE rule is expected to draw legal challenges from progressive states and environmental groups, creating further uncertainty for automakers. Experts also warn the rollbacks will disadvantage U.S. automakers competing in the global market as other countries move toward raising fuel economy and slashing climate emissions.

“Globally the goal posts for fuel economy standards and greenhouse gas emissions have moved significantly in the last two years with major markets moving forward as the U.S. is moving backwards,” said^[11] Margo Oge, former Director of the EPA Office of Transportation and Air Quality. “The EU, for example, set a new CO2 car standard at 76 [miles per gallon] for 2030 with an aggressive plan to transform the entire auto industry to electric vehicles. And, adding insult to injury, even EPA’s own analysis found that the new rule will result in a loss of thousands of auto industry jobs.”

“The auto sector is already reeling from economic turmoil related to the COVID-19 pandemic, and this rule will lead to prolonged litigation, regulatory uncertainty and economic disarray,” Sen. Tom Carper (D-Del.) told E&E News^[12].