Carmakers face no fines in the US for failures to meet fuel efficiency rules dating back to the 2022 model year under a law signed by President Donald Trump earlier this month, US regulators said.
The tax and budget bill approved by Trump ends penalties for not meeting Corporate Average Fuel Economy rules under a 1975 energy law.
The National Highway Traffic Safety Administration said in a letter to carmakers seen by Reuters that it was working on its reconsideration of fuel economy rules. The decision is one of a number made by Washington to make it easier for carmakers to build petrol-powered vehicles and to make electric vehicle sales more costly.
Last year, Chrysler-parent Stellantis paid $190.7m in civil penalties for failing to meet US fuel economy requirements for 2019 and 2020 after paying nearly $400m for penalties from 2016 to the end of 2019. GM previously paid $128.2m in penalties for 2016 and 2017.
Last month, Trump signed a resolution of disapproval under the Congressional Review Act to bar California’s landmark plan to end the sale of petrol-only vehicles by 2035.
Last year, Tesla said it received $2.8bn in global revenue from regulatory credits it earns from selling zero-emission EVs and sells to other carmakers seeking to meet vehicle emissions targets.
Republican Senator Bernie Moreno of Ohio said the costs carmakers paid Tesla to be in compliance were “outrageous”.
Trump NHTSA administrator nominee Jonathan Morrison said on Wednesday at a Senate hearing, “at the end of the day a consumer is going to pay for that”.
The law signed by Trump this month specifies that vehicle fines would be eliminated for any year that NHTSA had not finalised.
Dan Becker, director of the Center for Biological Diversity’s Safe Climate Transport Campaign, criticised the decision.
“The Trump administration is reaching back in time to give an obscene gift to pollution law violators GM and Stellantis at the expense of the US taxpayer,” Becker said. “The automakers lobbied hard for this ‘get out of jail free’ card. They get hundreds of millions in fines cancelled.”
GM and Stellantis did not immediately comment. Senate Republicans estimated the law would save carmakers $200m.
The Alliance for Automotive Innovation, a trade group representing nearly all major carmakers, thanked congressional leaders for addressing concerns about fuel economy rules saying “given current market conditions, the existing standards were challenging for many auto manufacturers to achieve”.
In 2023, under former President Joe Biden, NHTSA said its proposal to hike fuel economy standards through 2032 would cost the industry $14bn in projected fines including $6.5bn for GM, $3bn for Stellantis and $1bn for Ford.
The final rule adopted in 2024 eased requirements and said the car industry would face no more than $1.83bn in fines from 2027 to 2031.
Reuters
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