Five States Sue U.S. for Delaying Stiffer Gas-Guzzler Fines

Five states have sued the U.S. government for delaying stronger penalties for carmakers that fail to meet federal fuel economy targets.

The lawsuit says the states—California, Maryland, New York, Pennsylvania and Vermont—aims to “hold the Trump administration accountable” for reversing an Obama-era regulation that would more than double fines for noncompliance.

Three environmental groups (the Center for Biological Diversity, Natural Resources Defense Council and Sierra Club) filed a separate complaint over the same delay.

The National Highway Traffic Safety Administration decided in July to suspend the 2016 ruling days after the proposed new fee structure was published in the Federal Register. The revised penalties were prompted by a law that requires federal agencies to adjust their civil penalties for inflation.

Backers say the current fee structure is so modest that it’s cheaper for carmakers to pay the penalty than build more efficient vehicles. Manufacturers, who have described the revised fines as “draconian,” contend the tougher penalties would hike the auto industry’s annual cost of complying with corporate average fuel economy (CAFE) standards by $1 billion.