Carmakers, Calif. Reach Pact on Emission Limits

Four carmakers—BMW, Ford, Honda and Volkswagen—have reached a voluntary agreement on emission standards in California, Reuters reports.

The pact challenges the Trump administration’s intent to rescind California’s legal right to set its own pollution limits. The move also is a new attempt by carmakers to coax California and federal regulators to adopt a single set of regulations for the entire country.

A joint proposal by the U.S. Environmental Protection Agency and National Highway Traffic Safety Administration seeks a nationwide freeze on emission limits and fuel economy standards between 2020 and 2026. The plan would replace the current Obama-era schedule that requires 5% annual hikes in fuel economy over the same period.

Under the California compromise, carmakers would strive to improve their CAFE (corporate average fuel economy) by 3.7% per year during the 2022-2026 model years. One percentage point of each year’s goal would be covered by credits earned through selling hybrid and all-electric cars.

The plan also would grant carmakers more credit for design and technology improvements that contribute to fuel efficiency but aren’t measured under current test methods.

The pact follows a June 6 letter by 17 carmakers that pleaded with the Trump administration and California regulators to renew efforts to reach a single set of standards. The White House, which broke off the talks in February, rejected the letter and is widely expected to announce the final EPA-NHTSA plan within the next few months.

Reuters says the rejections prompted carmakers and California to launch their own negotiations.