Environmental regulators in California and five automakers finalized a deal this week that would voluntarily cut emissions among new cars over time and bring to market more electric vehicles in that state, and other states that follow similar emissions guidelines.
The deal was announced Monday by the California Air Resources Board, which said Ford, Volkswagen Group, Honda, and BMW finalized plans announced last year to reduce emissions. That agreement was made in spite of a federal push to rollback Obama-era fuel-economy standards that the current Trump administration claimed were too onerous and harmful to the nation's economy.
Initially, the June 2019 agreement between CARB and the automakers, which later included Volvo, was targeted by the U.S. Department of Justice for potential antitrust violations. Those allegations were later dropped.
The final deal strikes a middle ground between the Obama-era regulations that annually increased efficiency in new cars by 5% each year until 2026 and the proposed Trump rollback, which increased efficiency targets by only 1.5% each year. The announced deal says it will increase emissions standards "at about the same rate" as the Obama-era policy, but didn't disclose what that rate would be.
States that follow California's emissions guidelines—Colorado, Connecticut, Delaware, Maine, Maryland, Massachusetts, New Jersey, New Mexico, New York, Oregon, Pennsylvania, Rhode Island, Vermont, Washington—are expected to endorse the plan. California was allowed to set its own, stricter emissions rules under a waiver granted by the federal government for decades until the Trump administration revoked that waiver, setting up a showdown in federal court. California and 23 other states sued the federal government to set its own emissions standards, which has been mired in the courts since it was filed in November 2019.
The relaxed EPA rules are under scrutiny as well. Last month, the EPA said it would investigate whether its new rules were rushed and did not meet the agency's criteria for transparency.