Trump administration officially rolls back Obama’s fuel efficiency rules

The Trump administration announced new fuel efficiency standards Tuesday that roll back the aggressive plans made by the Obama administration.

The rules, which were required by law to be released Tuesday, seek a 1.5% annual increase in fuel efficiency on automobiles beginning next year, a big drop from the 5% increase set by President Obama.

The changes to the Corporate Average Fuel Economy (CAFE) standards would mean average miles per gallon in new vehicles would be around 40 as opposed to the 55 mpg by 2025 that the Obama administration wanted.

The administration said the new rules for vehicle fleets, which set mileage standards through 2026, strike a proper balance among consumer needs, the economy and the environment, but critics contended the final rules will damage the nation’s climate change efforts.

The administration says the new rules will make new vehicles more affordable, which will lead to a major reduction in deaths and injuries as consumers will replace their older, less-safe models with new automobiles that have better safety features.

“Our standards are tough but obtainable,” said James Owens, acting administrator of the National Highway Traffic Safety Administration (NHTSA). “We think we’ve struck the right balance. By reducing the regulatory burden we will get more Americans into newer, safer, cleaner vehicles.”

Many automakers say the Obama-era standards would have been difficult to reach, as consumers continue to buy gas-guzzling SUVs and trucks and have turned away from smaller sedans that use less gasoline.

With the average price of a new vehicle in the U.S. climbing to $38,000, the administration argued it had become an item increasingly beyond the means of many American families to buy new. The average age of a car on the American highways is 12 years old, up from eight years old in 1990, Mr. Owens and other administrators said in a conference call Tuesday announcing the new standards.

The new regulations should knock at least $1,000 of the sticker price of new vehicles and spur the purchase of up to 2.7 million new cars. That would mean 3,300 fewer fatalities, 397,000 fewer injuries and more than 1.8 million fewer vehicles damaged in crashes, according to the NHTSA and the Environmental Protection Agency, which worked together for 18 months to draw up the new regulations.

“This rule reflects the department’s No. 1 priority — safety — by making newer, safer, cleaner vehicles more accessible for Americans who are, on average, driving 12-year-old cars,” Transportation Secretary Elaine Chao said. “By making newer, safer and cleaner vehicles more accessible to American families, more lives will be saved and more jobs will be created.”

Environmental and liberal groups reacted with outrage to the softening of standards the Obama administration implemented in 2012 and vowed court battles. They also criticized officials for releasing the new regulations during the coronavirus pandemic.

“This Trump administration rule proposal to reduce fuel-economy standards would be a harmful step backward, increasing air pollution that causes respiratory illness and forcing drivers to pay more at the pump, all at a time when Americans are struggling with health and economic hardship,” said Aaron Kressig, transportation electrification manager for Western Resource Advocates.

The new standards also ran afoul of environmentalists.

“At a time when scientists are telling us that we must transform our economy and build a 100% clean future as soon as we possibly can, this outrageous action moves us closer to a future climate that is inhospitable to humanity,” said Christy Goldfuss, senior vice president at the liberal Center for American Progress.

Transportation is the largest source of greenhouse gas emissions in the U.S.

Mr. Obama expressed his own opposition to the new standards, while including a partisan shot about elections.

“We’ve seen all too terribly the consequences of those who denied warnings of a pandemic,” he tweeted. “We can’t afford any more consequences of climate denial. All of us, especially young people, have to demand better of our government at every level and vote this fall.”

The Competitive Enterprise Institute, a free-market think tank that has pushed for a relaxation of the Obama-era mandates, praised the Trump administration’s move but said it should have done more.

“The rollback is a welcome step in slowing down CAFE’s progressively worse restrictions on consumer choice in car buying,” said CEI General Counsel Sam Kazman. “But in our view, the agencies should have gone even further; rather than just slowing down the CAFE increases, they should have either frozen or even rolled back the standards. That would have been even better for consumers and for the country.”

The administration’s original proposal was to freeze standards after this year.

The energy industry also applauded the new rules, pointing out the difficulty of reaching the Obama administration’s standards.

“President Trump inherited a CAFE mandate from his predecessor that was impossible to achieve without dramatically altering the automobile market or making the cost of vehicles out of reach for most Americans,” said Thomas Pyle, president of the American Energy Alliance. “This new CAFE rule will make cars more affordable for consumers at a time when they need it most. The rule puts the power back into the hands of drivers, not bureaucrats, and most importantly it will save lives.”

The new regulations put the federal government on a collision course with state regulators in California and other states hat have moved aggressively to put more stringent fuel efficiency standards on vehicles sold there.

There were also questions about the mathematical models underpinning the new rules, promulgated after the administration said it took into account more than 750,000 comments made on the draft proposal. For example, some questioned whether the savings consumers might realize on fuel costs under the stricter regulations erased purchase savings, or whether deaths from air pollution reduced the numbers of lives saved by the newer cars.

Administrators said they were ready and able to defend their guidelines in court, although they accused critics of cherry-picking data. In terms of the coronavirus, they argued lower prices would matter to consumers reeling from soaring unemployment and lost wages.

“The lack of fleet turnover creates a whole host of problems, most importantly passenger safety,” Mr. Owens said.

The Trump administration’s announcement comes less than a week after the European auto industry asked the European Union to ease its own emissions standards because of the economic strains of coronavirus.

In the EU, automakers are to start this year on new regulations that would demand an average of 92 miles per gallon by the end of 2030.

“This upsets the plans we had made to prepare ourselves for complying with existing and future EU laws and regulations within the applicable deadlines set in these regulations,” the European Automobile Manufacturers Association wrote to the head of the EU on March 25 in a letter also signed by tire manufacturers and auto dealers.