An appeals court in the U.S. has overturned the Trump administration’s rule in July 2019 seeking to suspend a regulation that more than doubled penalties for automakers failing to meet fuel efficiency requirements.
Under the Obama administration, the National Highway Traffic Safety Administration (NHTSA) issued rules to raise fines from $5.50 to $14 for every 0.1 mile per gallon new cars and trucks consume in excess of required standards. However, President Trump’s administration had pushed to, and initially succeeded, in suspending this hike in penalties.
In a decision issued on Monday, though, the U.S. Court of Appeals for the Second Circuit said the NHTSA did not make a timely decision to reconsider the penalties.
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In a statement, Sierra Club senior attorney Alejandra Núñez said the decision means “the Trump Administration cannot give away polluting passes to automakers who lag behind on meeting standards required by law.”
Reuters notes that car manufacturers had protested the hike in penalties, saying it could increase industry compliance costs by $1 billion annually. Automakers added the fines would force them to boost the value of fuel economy credits to meet requirements.
In contrast, environmental groups urged the Trump administration to retain the fine increase, stating that U.S. fuel economy fines had lost nearly 75 per cent of their value as they had only increased once from $5 to $5.50 over a 40-year period.
Many car manufacturers have chosen to pay fines over the years rather than updating their vehicles to meet fuel efficiency requirements. In October 2019, for example, Fiat Chrysler Automobiles revealed it was facing a $79 million U.S. civil penalty for failing to meet 2017 fuel economy requirements.
