If you assumed that the federal mandate requiring automakers to reach the 54.5 miles per gallon corporate average fuel economy standard by 2025 was negotiated cordially and ended in a group hug, think again. Verbal fisticuffs and head butting would be more accurate descriptions, with members of Congress and automakers joining the squabble with the federal regulatory agencies. During the negotiation process, foreign automakers took umbrage with more favorable treatment domestic makers seemed to be receiving by the White House.
While the White House did keep the process quiet and off the public radar, it was more like a boiling cauldron behind the scenes, according to new reports. On Friday, the House Oversight and Government Reform Committee's Republican majority staff released a report stating foreign automakers had bitterly complained about how they were treated. Jim Lentz, the U.S. sales chief for Toyota, said Toyota executives in Japan feel like, "they've been screwed" by the mandate that nearly doubles the fuel economy standards by 2025 and what they see as preferential treatment given to larger trucks, calling it a "second bailout for Detroit."
The White House defended the deal, with White House spokesman Clark Stevens saying the historic standards for 2017-2025 model year light-duty vehicles will save families $1.7 trillion dollars at the pump and dramatically reduce fuel consumption. More than a dozen automakers, along with the United Auto Workers, the state of California (which, at that time, made things more difficult with its even more stringent standards), and environmental organizations, supported the mandate, Steven said.
Toyota wanted a few things out of the deal – credits for hybrid electric vehicles, a category in which the company dominates, more flexibility to use car credits for meeting truck standards, and inclusion of the Toyota Tundra in the definition of full-size trucks in the mandate. Volkswagen and other German automakers complained that the deal didn't give credits for clean diesel, while it did favor EVs, compressed natural gas and ethanol. Resentment with the state of California and its regulatory agency, the California Air Resources Board, also raised hackles in the negotiation process.
At the end of the day, the major automakers are now quietly complying with the federal rules and it doesn't look like they will be fighting the state of California in court over its zero emissions rules, as they did a few years ago.