Automakers urge new EPA chief to withdraw Obama car fuel-efficiency rules

[February 22, 2017]  By David Shepardson

WASHINGTON (Reuters) - A trade association representing General Motors Co, Toyota Motor Corp, Volkswagen AG and nine other automakers on Tuesday asked new Environmental Protection Agency chief Scott Pruitt to withdraw an Obama administration decision to lock in vehicle emission rules through 2025.

On Jan. 13, then-EPA Administrator Gina McCarthy finalized a determination that landmark fuel efficiency rules instituted by President Barack Obama should be finalized through 2025, a bid to maintain a key part of his administration's climate legacy.

Mitch Bainwol, president and chief executive of the Alliance of Automobile Manufacturers, said in a letter to Pruitt the decision was "the product of egregious procedural and substantive defects" and is "riddled with indefensible assumptions, inadequate analysis and a failure to engage with contrary evidence."

Automakers have argued that the rules could result in the loss of up to 1 million jobs because consumers could be less willing to buy the more fuel efficient vehicles since their engineering will result in higher price tags.

The EPA had until April 2018 to decide whether the 2025 standards were feasible but in November moved up its decision to Jan. 13, just before Obama left office.

Separately, the Association of Global Automakers, a trade group representing Honda Motor Co, Nissan Motor Co Ltd, Hyundai Motor Co and others, said late Tuesday it had formally petitioned the EPA to withdraw the determination. The group argued in a separate letter to Pruitt Tuesday reviewed by Reuters that "EPA opted for political expediency" and "jammed through a final determination in the waning days of the lame-duck administration."

EPA spokeswoman Julia Valentine said the agency is reviewing the letter and declined to comment further. Pruitt told a Senate panel earlier he will review the Obama administration's decision.

Scott Pruitt, administrator of the Environmental Protection Agency (EPA), speaks to employees of the agency in Washington, U.S., February 21, 2017. REUTERS/Joshua Roberts

The auto group requests follow a separate letter to President Donald Trump earlier this month from the chief executives of GM, Ford Motor Co and Fiat Chrysler Automobiles NV, along with the top North American executives at Toyota, VW, Honda, Hyundai, Nissan and others urging Trump to revisit the decision.

Automakers say the rules impose significant costs and are out of step with consumer preferences. Environmentalists say the rules are working, saving drivers thousands in fuel costs and should not be changed.

In 2011, Obama announced an agreement with automakers to raise fuel efficiency standards to 54.5 miles per gallon. This, the administration said, would save motorists $1.7 trillion in fuel costs over the life of the vehicles but cost the auto industry about $200 billion over 13 years.

The EPA said in July that because Americans were buying fewer cars and more SUVs and trucks, it estimated the fleet will average 50.8 mpg to 52.6 mpg in 2025.

McCarthy could not be reached Tuesday but said in her determination in January the rules are "feasible, practical and appropriate" and in "the best interests of the auto industry."

(Reporting by David Shepardson; Editing by Cynthia Osterman and Lisa Shumaker)

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