The Trump Administration has asked the Environmental Protection Agency (EPA) to reopen a review of auto emission mandates put in place by the Obama Administration. Manufacturers have long argued the aggressive standards were too costly and out-of-touch with market realities.
Just days before President Trump’s inauguration, the EPA announced it would keep intact strict mandates that require automakers to raise their fleet-wide fuel economy average to 54.5 mpg by 2025. That decision abruptly cut off the midterm review of the standards, which automakers hoped would be relaxed in the wake of $2/gallon gasoline and shifting consumer preference away from small cars.
The EPA, under the Obama Administration, estimated it would cost the auto industry about $33 billion to meet the 2025 standards. The Agency also estimated that fuel savings and energy security would outweigh the costs of the rules and lead to about $98 billion in net benefits. But that was before the average price of gas fell from $4/gallon to $2/gallon.
The reopening of the midterm review does not mean the standards will be weakened, but it does give automakers the opportunity to push for relief from the new EPA Administrator, Scott Pruitt. The National Automobile Dealers Association (NADA) endorsed the move, saying it supported “a transparent, fair and data-driven midterm review of fuel-economy standards.”
The industry feels that maintaining vehicle affordability is critical to building on the progress already made on increasing fuel economy and lowering vehicle emissions. The environment doesn’t benefit if a fleet of 54.5 mpg vehicles are sitting idle on dealership lots.