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Major Automakers Undermine Climate Action, Ignoring Investors and Peers on Clean Vehicle Standards

Published 10-30-19

Submitted by Ceres

General Motors, Toyota and Fiat Chrysler announced last night that they, together with the Association of Global Automakers, would side with President Trump in his effort to remove the authority of California and other states to set clean vehicle standards, an effort Ceres’ Senior Director of Transportation Carol Lee Rawn says “will subject much of the U.S. auto sector to years of regulatory risk and uncertainty, undermines future global competitiveness, and deprives Americans of cleaner and more affordable cars.”

The decision to oppose the authority of California, which has long spurred the development of cleaner and more affordable vehicles, and other states contradicts the automakers’ stated commitment to climate action and effectively supports a scenario both General Motors and Toyota themselves said would create “untenable” instability in the U.S. auto sector in a June letter from automakers to the Trump administration. The decision also flies in the face of investors with more than $1.1 trillion assets under management who recently urged General Motors to join the compromise agreement with California in order to avoid such instability and enhance the sector’s global competitiveness - as the Trump Administration’s efforts to revoke California’s waiver will lead to years of regulatory uncertainty and litigation.

New York City Comptroller Scott Stringer said, “In New York City, we know that a sustainable planet and a secure retirement go hand-in-hand. I am deeply concerned that General Motors, Toyota and Fiat Chrysler decided to help President Trump drag the auto industry backwards while the rest of the world speeds ahead on climate. The stubborn refusal of General Motors and others to stop lobbying against climate action is inconsistent with their companies’ need to transition to a low carbon economy for the good of the planet and the good of investors.” 

The automakers’ decision puts them squarely in opposition to states and a host of other stakeholders, including industry, health, consumer and environmental groups. Fifteen states, representing approximately 40% of the U.S. auto market, have adopted or plan to adopt the California standards, and twenty-two states have joined California in a lawsuit defending its authority. Recognizing the benefits of cleaner and more affordable cars for their customers, as well as regulatory certainty for the industry, Ford, BMW, Honda, and Volkswagen joined a compromise solution with California, which effectively provides one national standard. By breaking with their peers, General Motors, Fiat Chrysler, and Toyota, along with the Association of Global Automakers, undermine their fellow automakers’ efforts to align with the country’s climate goals and to ensure clean air and fuel cost savings for the American public. 

Rawn added:

"We urge these automakers to reverse course. Strong clean vehicle standards are absolutely necessary to help us meet the climate targets these automakers have long claimed to support. General Motors, Toyota, Fiat Chrysler, and the Association of Global Automakers have chosen a path that will undermine our ability to meet climate targets and that will put them at significant regulatory, legal and competitive risk. If they genuinely want a uniform standard and a compromise solution, they should join Ford, Honda, Volkswagen, and BMW in the compromise agreement with California.”

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Ceres is a sustainability nonprofit organization working with the most influential investors and companies to build leadership and drive solutions throughout the economy. Through powerful networks and advocacy, Ceres tackles the world’s biggest sustainability challenges, including climate change, water scarcity and pollution, and human rights abuses.

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