Written by Coral Davenport
General Motors turned its back Monday on the Trump administration’s legal fight to nullify California’s strict fuel economy rules, signaling that it was ready to work with President-elect Joe Biden to reduce climate-warming emissions from cars and trucks.
The decision by Mary Barra, the GM chief executive, to withdraw her company’s support for Trump administration efforts to strip California of its ability to set its own fuel efficiency standards was a striking reversal. It was also a signal that corporate America is moving on from President Donald Trump.
More specifically, it was a sign that Biden may find the auto industry amenable as he tries to reinstitute and rebuild Obama-era climate change regulations that Trump systematically dismantled, at times with the help of industry.
“President-elect Biden recently said, ‘I believe that we can own the 21st century car market again by moving to electric vehicles.’ We at General Motors couldn’t agree more,” Barra wrote in a letter Monday to leaders of some of the nation’s largest environmental groups.
She added, “We are immediately withdrawing from the preemption litigation and inviting other automakers to join us,” a signal to Toyota and Fiat-Chrysler, the other two major automakers that have sided with the Trump administration against California in the ongoing legal fight.
GM’s maneuvering was a public humiliation to Trump as he pursued his democracy-defying effort to subvert the will of the American electorate and claim another term. Barra gave no warning to the administration, but she did speak by telephone Monday with Mary Nichols, California’s top climate regulator and an architect of the Obama-era fuel economy rules. Nichols is also a leading candidate to run the Environmental Protection Agency under Biden.
“It’s always interesting to see the changing positions of U.S. corporations,” said a spokesman for the EPA, James Hewitt, when informed of Barra’s announcement.
There is little doubt Barra’s action was prompted by the outcome of the presidential election, according to two people familiar with her thinking who were not authorized to speak publicly. Even so, the way she did it took analysts aback.
“This is about as bold as it gets,” said Barry Rabe, a professor of public policy at the University of Michigan. “This huge pivot, so closely following an election result, particularly from a firm like General Motors, is a big, big deal.”
He added: “This is the first big industrial step toward the next president. Are other industries going to have epiphanies and pivot?”
The sudden shift may help the Biden administration move quickly to reinstate tough rules on planet-warming auto pollution, this time with support from industry giants that fought such regulations for years.
“There were many things where the wind was in the face of the Obama administration on climate, specifically, the automakers,” said John Morton, a former climate policy adviser to President Barack Obama who has spoken with members of Biden’s transition team.
“Biden will not be pushing against the industry the way Obama had to,” he said.
In fact, Biden said that he had spoken about policy issues in a meeting with Barra just last week. “GM’s choice to work with the Biden-Harris administration and California to advance these goals demonstrates a promising path forward for how industry, labor, government, and environmental organizations can come together to tackle big problems and make vital progress on behalf of the American people,” Biden said in a statement. “I applaud the steps that Mary Barra announced in her letter to environmental leaders today.”
For nearly four years, General Motors has pushed Trump to loosen Obama-era standards on fuel economy and climate-warming emissions. Barra met with Trump in his first weeks in office and urged him to weaken the stringent tailpipe pollution standards that would have been the United States’ most significant domestic policy to curb global warming.
Last year, the administration went even further, revoking the legal authority of California and other states to set tighter state restrictions. When the states sued, GM, Toyota and Fiat Chrysler intervened on the side of the administration.
Barra’s letter stopped short of backing California’s standards but indicated that she was open to aligning her company with them, joining five other auto companies — Ford, Honda, BMW, Volkswagen and Volvo — that already have.
“We believe the ambitious electrification goals of the president-elect, California, and General Motors are aligned to address climate change by drastically reducing automobile emissions,” she wrote. “We are confident that the Biden administration, California, and the U.S. auto industry, which supports 10.3 million jobs, can collaboratively find the pathway that will deliver an all-electric future. To better foster the necessary dialogue, we are immediately withdrawing from the preemption litigation and inviting other automakers to join us.”
The president-elect has promised policies to make the United States electricity sector a net-zero producer of planet-warming pollutants by 2035 — and to reduce total U.S. emissions to zero by 2050. To do that, virtually all cars and trucks would have to stop burning diesel and gasoline, and their electric batteries would have to be charged by renewable energy sources like the wind and the sun.
Environmentalists applauded the move by General Motors. “This is a victory for Americans from every corner of the country who all deserve cleaner cars and clean air,” said Wendy Wendlandt, acting president of Environment America. “We hope other automakers will follow the lead of GM, Ford, BMW, Honda, Volkswagen, Volvo and others driving toward the right side of history when it comes to the clean car standards. It’s never too late to do the right thing.”
A spokesman for Toyota, Scott Vazin, wrote in an email, that “Given the changing circumstances, we are assessing the situation, but remain committed to our goal of a consistent, unitary set of fuel economy standards applicable in all 50 states.”
A spokesman for Fiat Chrysler did not respond to a request for comment.
Rep. Debbie Dingell, D-Mich., who was once a GM lobbyist, said, “General Motors did the right thing today by removing their name from this misguided lawsuit. It’s time for other automakers to do the same.” Dingell represents the auto manufacturing city of Dearborn, Michigan, on the outskirts of Detroit, and for decades, she and her husband, former Rep. John Dingell, who died in 2019, pushed back against tightening fuel economy standards.
Since his first days in office, Trump proudly pushed his plan to roll back auto fuel economy standards as a signature economic move, one that he vowed would revive American auto manufacturing. The plan also ignited Trump’s fight with California, which has led the legal fight for states to enact their own fuel economy standards.
But in the end, Trump’s rollbacks exceeded even what automakers had asked for, prompting a rift within the industry. Some automakers sided with the White House, arguing that they needed a single national standard to give them market stability. Others sided with California, saying the state’s standards would drive the industry to a more innovative future and a global resurgence.
Obama had seen the fuel economy rule as the centerpiece of his environmental legacy. Modeled after California’s state-level standard, it required automakers to build vehicles that achieve an average fuel economy of 54.5 mpg by 2025, which would have eliminated about 6 billion tons of planet-warming carbon dioxide pollution over the lifetime of the vehicles. Automakers at the time had complained about the stringency of the standard, but they had little choice but to comply after the government bailout of their industry following of the 2008 financial crisis.
Initially, automakers were eager to see Trump loosen that rule. But in private meetings, they also told him that they did not want to see him roll back the rule too far, fearing that California and other states would then sue to maintain separate, tighter state-level standards — an outcome that automakers saw as their worst nightmare.
Disregarding the automakers, Trump rolled back Obama’s standards from 54.5 mpg by 2025 to 40 mpg and revoked California’s legal authority to set its own standard.
California, meantime, reached a separate deal with Honda, Ford, Volkswagen, BMW and Volvo under which they would be required to increase their average fuel economy to about 51 mph by 2026.
The deal, brokered by Nichols, was reached in secret and enraged Trump when it was announced. In the months that followed, Trump amped up his attacks on California and its governor, Gavin Newsom, as his administration pursued a series of unusual, and sometimes punitive, policy actions against the state, in what was widely seen as retribution for the clean cars deal.
That California compromise is now seen as the likely model for a new, Biden-era fuel economy rule.