Conservative Enterprise Institute sues Trump administration over fuel economy rollback

Jonathon Ramsey

People take photos with downtown Los Angeles in the distance in April during the coronavirus lockdown. EPA data from March show that a lack of driving has given L.A. its longest stretch of good air since 1995. / Getty Images


The Trump administration's new regulations lowering future fuel economy targets set into place by the Obama administration were published in the Federal Register on Thursday. Known as the Safer Affordable Fuel Efficient (SAFE) rule, the crux of its 1,105-pages is the requirement that from 2021 to 2026, an automaker's corporate average fuel economy (CAFE) must increase by 1.5% each year, reaching a 40-mpg fleet average in the final year. The Obama administration had mandated roughly 5% increases, putting the 2026 CAFE standard at 47 mpg. For complicated historical reasons, CAFE numbers are about 20% higher than the EPA numbers on a car's Monroney, so we're really talking about 32 mph to 40 mpg on the road.

The Department of Transportation, the Environmental Protection Agency, and the National Highway Traffic Safety Administration believe the new law will be sustainable for automakers, create jobs, and protect the environment. One of the prime rationales is that the previous rules would have increased the price of a new car by about $3,500. Without that impediment, the agencies say more people will buy new cars, getting older cars off the road and lowering emissions. Not all automakers are on board with Trump's plan, so on Friday, President Trump tweeted, "My proposal to the politically correct Automobile Companies would lower the average price of a car to consumers by more than $3500, while at the same time making the cars substantially safer. Engines would run smoother. Positive impact on the environment! Foolish executives!"

The same day SAFE became official, it got its first court challenge. The libertarian Conservative Enterprise Institute (CEI) told Bloomberg it challenged the law in federal district court in Washington, D.C., on the grounds that the EPA and NHTSA didn't go far enough in rolling back the previous standard. The institute's general counsel said, “The agency was right to roll back the scheduled increases in fuel economy standards, which would have made cars less crashworthy and increased highway fatalities. But NHTSA should have reduced those standards even more, and perhaps frozen them entirely.”

The allegation is that NHTSA didn't appropriately analyze how the regulation will affect vehicles in the future. CEI has launched this kind of lawsuit before, targeting the same defendant with the same accusation. In 1992, CEI challenged NHTSA in court over the change in fuel economy standards for 1990MY vehicles, the assertion being that stricter mpg rules "would force automakers to produce smaller vehicles that are less safe." CEI won its case, forcing NHTSA to conduct the analysis, which the agency did. When the agency upheld its previous findings, CEI challenged the analysis, but the court sided with NHTSA. More recently, CEI sued the State Department over the Obama administration's "disgraceful process of circumventing the Senate and the U.S. Constitution to enter the Paris climate treaty."

Back to NHTSA, this time the CEI is adding a new angle in its fight, saying it would name individual plaintiffs for the suit who were "concerned about the SAFE’s rule’s impact on their future car-buying choices."

On the other side of the aisle, state attorneys general — California leading the way — and environmental groups like the National Resources Defense Council are preparing cases against the administration and the EPA for not having higher standards under SAFE, just one of a growing number of lawsuits aimed at recent administration decisions.

The Golden State says that over the past 50 years, its regulations have cut many air pollutants anywhere from 75% to 99%, saving roughly 29,000 lives every year. Strangely, as related by The Hill, NHTSA's cost-benefit analysis included with the SAFE rule shows "it will save about 700 lives, but elsewhere the rule shows anywhere from 440 to 1,000 premature deaths resulting from air pollution caused by the increase in smog and other pollution," and that "the rule will cost more than it will save by at least $13 billion." And although carmakers had voiced their concern that the previous regulations weren't feasible, SAFE sets the bar lower than what the automaker said they could achieve.

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