Canadian vehicles could be affected by change to Obama's CO2 rules

Automakers say the rules make cars more expensive and could cost jobs

Alliance of Automobile Manufacturers chief Mitch Bainwol: Obama's fuel-efficiency mandate is "riddled with indefensible assumptions, inadequate analysis and a failure to engage with contrary evidence."

WASHINGTON -- Canadian vehicles may not become as fuel efficient as quickly as once planned if a U.S. trade association representing several automakers convinces Washington to repeal a piece of U.S. environmental regulation.

The Alliance of Automobile Manufacturers, which represents General Motors, Toyota Motor Corp., Volkswagen AG and nine other automakers on Tuesday asked new the U.S. Environmental Protection Agency chief Scott Pruitt to withdraw an Obama administration decision to lock in vehicle emission rules through 2025.

Because Canadian fuel economy and emissions regulations often follow those of the United States, any changes would more than likely affect the vehicles sold here.

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, CEO 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.

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.

Bainwol's request follows a separate letter to President Donald Trump earlier this month from the chief executives of GM, Ford Motor Co. and Fiat Chrysler Automobiles, along with the top North American executives at Toyota, VW, Honda Motor Co., Hyundai Motor Co., Nissan Motor Co. 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 mpg or 4.32 litres per 100 km. This, the administration said, would save U.S. motorists US$1.7 trillion (CDN $2.23 trillion) in fuel costs over the life of the vehicles but cost the auto industry about US$200 billion (CDN $263 billion) over 13 years.

The EPA said in July that because Americans were buying fewer cars and more light trucks, it estimated the fleet will average 50.8 mpg to 52.6 mpg, or 4.63 L/100km to 4.47 L/100km, in 2025.

McCarthy could not immediately 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."

David Shepardson contributed to this report.

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