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15 states sue U.S. agency over delayed hike in automaker emissions penalties

Stock MarketsFeb 16, 2021 07:30PM ET
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© Reuters. The exhaust system of a Volkswagen Passat TDI diesel car is seen in Esquibien, France.

By David Shepardson

WASHINGTON (Reuters) - Fifteen U.S. states sued the National Highway Traffic Safety Administration (NHTSA) on Tuesday after it agreed last month under then-President Donald Trump to an auto industry request to delay the start of dramatically higher penalties for companies that fail to meet fuel efficiency requirements.

The state attorneys general, including from California and New York, filed suit in the U.S. Court of Appeals for the Second Circuit over the decision announced in the final days of the Trump administration.

NHTSA said last month it expected the final rule to cut future burdens on industry by up to $1 billion annually.

California Attorney General Xavier Becerra said on Twitter the decision "cements the Trump (administration's) legacy of putting industry ahead of public health."

A spokesman for the U.S. Transportation Department, NHTSA's parent agency, declined to comment on the legal challenge but said it is "reviewing this and other recent rules for consistency with the environmental, equity and other policy directions of this new Administration."

A group representing major automakers did not immediately comment on Tuesday.

Last month, the Sierra Club and National Resources Defense Council also sued NHTSA for delaying penalties.

Trump's move followed an appeals court ruling in August overturning the administration’s 2019 decision to suspend a regulation more than doubling penalties for automakers failing to meet fuel efficiency requirements.

Congress in 2015 ordered federal agencies to adjust civil penalties to account for inflation. In response, NHTSA issued rules hiking fines to $14 from $5.50 for every 0.1 mile per gallon a new vehicle consumes in excess of required standards.

Fiat Chrysler Automobiles, now known as Stellantis NV, paid a $79 million civil penalty for failing to meet 2017 fuel economy requirements, after paying $77.3 million for not meeting 2016 requirements.

Environmental groups urged the Trump administration to retain the increased penalties, noting U.S. fuel economy fines lost nearly 75% of their original value because they had been increased only once - from $5 to $5.50 in 1997 - since 1975.

President Joe Biden has also ordered a review of the Trump administration's decisions to roll back vehicle emissions standards through 2026 and bar California from setting vehicle tailpipe emissions limits.

15 states sue U.S. agency over delayed hike in automaker emissions penalties
 

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Comments (2)
Hunt Richardson
Hunt Richardson Feb 17, 2021 1:17AM ET
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increasing demand for and supply of EVs will eventually reduce the number of combustion vehicles on the road
Darryl Allen
Darryl Allen Feb 16, 2021 5:20PM ET
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If you were wondering why the average car costs $40,000, it's because of these regulations.
Benjamin McIntire
Benjamin McIntire Feb 16, 2021 5:20PM ET
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Automobile economics expert over here.
Benjamin McIntire
Benjamin McIntire Feb 16, 2021 5:20PM ET
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Its definitely regulation and not inflation.
 
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