Despite the growing animosity, both California and the Trump administration are still willing to discuss the country’s changing emission regulations. The state is currently heading a lawsuit against the Environmental Protection Agency, claiming it “acted arbitrarily and capriciously” in overturning the previous administration’s decision to maintain Corporate Average Fuel Economy standards.

While the proposals issued by the current administration will eventually see those targets rolled back, a final decision has not been made. The White House claims it wants to maintain an open dialogue with the Golden State, hoping to reach an agreeable solution, but the California Air Resources Board has argued it doesn’t seem to be acting on those assertions. Meanwhile, EPA head Scott Pruitt maintains that the state will not dictate federal fueling rules as automakers beg the government to do everything in its power to ensure a singular national mandate.

It’s an ugly situation, which makes news of a new round of meetings all the more surprising.  (Read More…)

While the Japanese government has walked on eggshells when discussing trade issues that are transforming the globe into an angry beehive, the nation’s automakers have been more forthright. However, they’re both getting increasingly vocal as the situation escalates.

As the United States and Japan head into trade discussions scheduled for July, it’s beginning to look like everyone will come out swinging — especially when it comes to the automotive industry. Last month, the White House launched a national security investigation into car and truck imports that could lead to new tariffs on some of Japan’s biggest U.S.-bound exports.

Japanese Finance Minister Taro Aso was uncharacteristically negative toward the current U.S. trade policy during a Group of Seven finance leaders’ gathering held last week. “It’s deeply deplorable,” Aso said. “Inward-looking policies involving one-sided, protectionist measures benefit no country.” (Read More…)

Governance is one hell of a slippery fish. While you want your elected officials to assist in helping the nation evolve with an ever-changing society, you don’t want a deluge of contradictory and ill-planned laws mucking things up. That’s why the best progress is carefully measured and negotiated. But something has to happen eventually or you begin wondering what we (and the various lobbies) are paying these dingbats the big bucks for.

For example, the North American Free Trade Agreement looks like it’s about to be abandoned until sometime after 2019. After negotiations missed numerous self-imposed deadlines, U.S. House Speaker Paul Ryan said Congress needed a notice of intent to sign by roughly May 17th if anything was to be finalized for 2018. That date came and went. Now, everyone appears to have thrown their hands up, with practically every country on the planet currently considering retaliatory tariffs against the United States.  (Read More…)

The Trump administration has enacted phase two of its plan to revise Obama-era rules designed to cut pollution from vehicle emissions. In a proposal sent to the White House Office of Management and Budget on Thursday, the Environmental Protection Agency announced its intention to rescind the California waiver that separates it from the federal standards the state uses to regulate greenhouse gas emissions from automobiles.

Since allowing California to set its own emission standards would effective split the country’s auto market, the EPA has been clear that its ideal solution would be to cut a deal with the Golden State. Agency head Scott Pruitt previously said California “shouldn’t and can’t dictate [fueling regulations] to the rest of the country,” but acted in a manner that suggested a compromised could be reached.

This was followed by a lawsuit filed by 17 U.S. states, along with the California governor’s office, California attorney general, and the California Air Resources Board (CARB), alleging that the EPA had “acted arbitrarily and capriciously” in its decision to roll back the previous administration’s decision. While the odds are good that the Trump administration wasn’t ever interested in bending to California’s more stringent pollution policies, this was likely the point of no return — squashing any hope for meaningful negotiations. (Read More…)

There’s been quite a bit of the old “he said, she said” as the global trade war between developed nations coalesces. Germany has not covered U.S. President Donald Trump’s trade policy favorably, not that it has much reason to. His new tariffs on imported steel and aluminum has tested relationships with numerous countries and, while it isn’t the biggest exporter of metal to the United States, Germany has something to lose. Likewise, proposed duties on passenger vehicles have sincerely rubbed Deutschland the wrong way.

However, the issue was further complicated this week after a gossipy report surfaced claiming Trump told French President Emmanuel Macron in April that he would continue hampering the European auto manufacturers until there are no Mercedes-Benz vehicles driving in America.  (Read More…)

There was a mighty blowback against the Trump administration’s suggestion to elevate tariffs to as much as 25 percent on all foreign-built passenger vehicles.

Already reeling from fresh import fees on aluminum and steel, Europe expressed its collective distaste on new taxes while Japan vowed to plead a strong case for itself. Meanwhile, prominent politicians and two of the largest automotive trade groups in the country came forward to condemn the plan, stating it was “confident that vehicle imports do not pose a national security risk” to the United States.

While the administration has already launched its investigation to determine whether vehicle and auto part importers threaten the industry’s health and ability to develop advanced technologies, the government noted that a second opinion wouldn’t hurt. Announced on Tuesday in the Federal Register, the the Commerce Department will allot two days in July for public comments on the matter.  (Read More…)

President Trump announced a security investigation into auto imports last week, tasking Commerce Secretary Wilbur Ross with the job. His goal will be to determine what effects imported vehicles have on the national security of the United States under Section 232 of the Trade Expansion Act of 1962 — which sounds like a monumental and rather complex task.

Basically, Ross will examine whether or not the U.S. can get away with escalating automotive tariffs. That’s a touchy subject, considering how contentious global trade has become in recent months. Worse yet, the 80-year-old commerce secretary will have to continue promoting American businesses and industries outside its borders while deciding on an issue few trade partners will be happy with.

Automakers aren’t thrilled either. After Trump announced the investigation, the Association of Global Automakers and Alliance of Automobile Manufacturers both said they didn’t believe vehicle imports posed a national security risk. “To our knowledge, no one is asking for this protection. If these tariffs are imposed, consumers are going to take a big hit,” said John Bozella, President of Global Automakers, in a statement. “This course of action will undermine the health and competitiveness of the U.S. auto industry.” (Read More…)

Several science advisers for the Environmental Protection Agency claim the agency has ignored its own research in order to rationalize the push to relax corporate average fuel economy (CAFE) targets.

A group within the Science Advisory Board has recommended reviewing the EPA’s justifications for the intended rollbacks, including the agency’s conclusion that Obama-era auto efficiency requirements must be changed because they are too stringent. It’s hoping to take the agency to task and force it to show evidence that upholds is proposal.

While EPA head Scott Pruitt sides with the President and automotive industry by indicating the current standards are too strict, very little scientific research has been cited to support the claim. In fact, the revision seems to hinge mainly on the belief that automakers might not be able to adhere to the standards approved by the Obama administration in its final days. “Obama’s EPA cut the midterm evaluation process short with politically charged expediency, made assumptions about the standards that didn’t comport with reality, and set the standards too high,” Pruitt said in April.  (Read More…)

President Donald Trump issued a tweet promising car manufacturers good tidings on Wednesday. “There will be big news coming soon for our great American Autoworkers,” he said. “After many decades of losing your jobs to other countries, you have waited long enough!”

Later that same day, the administration announced it had launched a national security investigation into car and truck imports under Section 232 of the Trade Expansion Act of 1962. The Commerce Department explained that the probe would investigate whether imported vehicles and parts threaten the domestic industry’s wellbeing, taking into account its ability to develop new technologies and the impact of tariffs.

“There is evidence suggesting that, for decades, imports from abroad have eroded our domestic auto industry,” Commerce Secretary Wilbur Ross said. (Read More…)

China has announced plans to slash import fees on automobiles to 15 percent starting this July. While the tariff currently rides high at 25 percent, the country’s Ministry of Finance said reducing it was part of an intentional effort to open up China’s markets and spur development within the local automotive sector.

It may also have been part of a peace offering. President Donald Trump has been pretty clear on China’s trade policies with the United States, frequently referring to them as unfair. The U.S. imposes a svelte 2.5 percent fee on imported vehicles — unless we’re talking about trucks. “Does that sound like free or fair trade?” Trump tweeted last month. “No, it sounds like STUPID TRADE — going on for years!” (Read More…)

If you forgot today was the deadline for finalizing North American Free Trade negotiations, don’t worry, so did practically everyone else. In fact, the whole affair is starting to feel like that old car that’s been sitting in your friend’s yard for far too long. He keeps telling you he’s going to fix it up and make it better than new. “This is the summer,” he says. But you know he’s just going to keep mowing around it while it continues to rust and collect mice, so you’ve tried to push it out of your mind.

Like the restoration, the entire concept of a deadline for the trade deal is rather arbitrary at this point. NAFTA’s initial target date for an agreement between the three countries was March 31st, roughly one year after negotiations began. The May 17th deadline was claimed by U.S. Speaker of the House Paul Ryan, who said Congress had to be notified under the Trade Promotion Authority statute.

“We need to receive the notice of intent to sign soon in order to pass it this year,” explained Ryan’s office. “This is not a statutory deadline, but a timeline and calendar deadline.”

Basically, Congress wants to influence the president and NAFTA negotiators to conclude talks swiftly and reach an agreement before midterm elections. But Mexican officials warned everyone not to get their hopes up. “The possibility of having the entire negotiation done by Thursday isn’t easy, we don’t think it will happen by Thursday,” said Mexican Economy Minister Ildefonso Guajardo earlier this week.  (Read More…)

Despite pressuring Donald Trump to lower corporate fuel economy mandates since practically day one of his presidency, automakers are now urging caution. The U.S. Transportation Department has drafted a proposal that would freeze vehicle requirements at 2020 levels through 2026, the Environmental Protection Agency’s lead administrator made a public case for rolling back mileage targets, and the White House seems ready to help car companies lower the bar.

Automakers seem to have won, so why the change of heart? (Read More…)

Ten automotive executives met with President Donald Trump this week, hoping to find ways to increase domestic production and mitigate the coming changes to corporate fuel economy regulations. The meeting, held in the White House’s Roosevelt Room, included General Motors’ Mary Barra, Ford’s Jim Hackett and Fiat Chrysler’s Sergio Marchionne. While a large portion of the event was spent discussing the administration’s attempt to roll back established fuel economy rules, Trump was focused on returning manufacturing jobs to the United States.

The president noted that FCA’s decision to spend $1 billion in order to expand truck assembly in Michigan made Marchionne more appealing than his contemporaries. “Right now, he is my favorite person in the room,” Trump said.  (Read More…)

America’s gas war is heating after 17 states, as well as the District of Columbia, filed a lawsuit against the Environmental Protection Agency’s decision to redefine U.S. vehicle emissions and fuel efficiency rules through 2025.

In April, EPA chief Scott Pruitt said the existing standards for model year 2022 to 2025 vehicles should be revised. The suit, filed in the U.S. Court of Appeals for the District of Columbia, alleges the EPA acted unpredictably, failed to follow its own regulations, and was in direct violation of the Clean Air Act. New York Attorney General Eric Schneiderman claimed the “Trump administration conducted a phony study” to justify altering emission rules to appease automakers and the oil industry.

Meanwhile, U.S. Representatives Doris Matsui of California and Paul Tonko of New York are demanding the EPA hand over all documents related to the study that resulted in the proposed changes to fuel economy standards.  (Read More…)

Environmental Protection Agency chief Scott Pruitt spent the majority of his Thursday being raked over the coals by the House Energy and Commerce subcommittee before a second (even uglier) exchange with the House Appropriations subcommittee. The majority of the time was spent addressing concerns surrounding Pruitt’s expenditures — things like unnecessary first-class travel, a $43,000 soundproof phone booth, and his 24-hour security team. There were also discussions about alleged death threats against Pruitt and EPA staff, his overall conduct, and even a little bit on environmental policy.

Those discussions, however, saw some subcommittee members accuse Pruitt of championing the profits of oil companies and automakers over the wellbeing of the planet. The EPA head spent the duration of Thursday defending his actions, including planned regulatory rollbacks on fuel economy. He also supported the automotive industry’s proposal to abolish 87 octane and replace it with 95.

As ugly as the day was for Pruitt, Republicans occasionally hopped on the mic to gently support him. Rep. Kevin Cramer of North Dakota said, “I think the greatest sin you’ve done is, you’ve actually done what President Trump ran on.” (Read More…)