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Money News

Why Car Companies Are Fighting Over Climate Change

April 22, 2019

  • Leading car manufacturers say climate change is real
  • They wrote to the White House, challenging its rollback of efficiency regulations
  • Manufacturers including Ford and General Motors say they will follow strict mileage goals
2 min read

Climate change is real.

That’s the message from the Alliance of Automobile Manufacturers, which has made fighting global warming by reducing carbon emissions a goal since 2018.

The alliance, an industry group whose members include some of the biggest automakers in the country such as Daimler AG, Ford, and General Motors, also wrote to the White House last year to push back against the Trump administration’s plans to ease fuel efficiency standards for cars.

Cars and climate: Some background

In April of 2018, the Environmental Protection Agency announced it would pare back Obama-era standards that would require car companies to produce vehicles that get 37 miles per gallon by 2022, eventually hitting 50 miles per gallon by 2025.

Instead, car companies in their letter urged the White House to follow California’s lead. The state, and 16 others plan to continue following the Obama era mileage goals. These states have sued the Trump administration, which said it may try to revoke the state’s authority in the matter.

States may set their own fuel efficiency goals, under the Clean Air Act.

Automakers say they’re still concerned about climate change and the industry’s role in rising global temperatures.

But cars are getting bigger!

Some car manufacturers have started turning away from making smaller economy cars with better mileage range, focusing instead on less energy-efficient SUVs and other larger vehicles.

In 2018, Ford announced it would stop manufacturing economy and mid-sized cars altogether, in favor of its trucks and SUVs. Car companies are also exploring tax loopholes that may reward them for manufacturing larger cars, according to the Wall Street Journal.

Still concerned

Despite the turn toward bigger cars, automakers say they’re still concerned about climate change and the industry’s role in rising global temperatures.

“Automakers remain committed to increasing fuel efficiency requirements, which yield everyday fuel savings for consumers while also reducing emissions — because climate change is real and we have a continuing role in reducing greenhouse gases and improving fuel efficiency,” David Schwietert, executive vice president of federal government relations at the Alliance, wrote in last year’s letter.

Schwietert added that setting up two sets of rules could have negative consequences for the roughly seven million people who work either directly or tangentially in the car industry.

What are greenhouse gases?

Greenhouse gases, created primarily by industry and human activity, trap heat in the atmosphere and are thought to contribute to global warming. They include carbon dioxide from the burning of fossil fuels like coal and oil, methane from decomposing animal waste, nitrous oxide from agricultural activities, and fluorinated gas from industrial processes.

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By Jeremy Quittner
Jeremy Quittner is the senior writer for Stash.

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