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We filed a petition requesting that the National Highway Traffic Safety Administration (NHTSA) reconsider and rescind a new rule reducing penalties for automobile manufacturers that fail to meet corporate fuel economy standards. Our petition explains how NHTSA’s analysis ignores financial and environmental benefits forgone by the rule and relies on flawed, even contradictory evidence. NHTSA’s weakened fuel economy penalties deprive the public of substantial benefits and should be rescinded.

The Environmental Protection Agency (EPA) and the National Highway Traffic Safety Administration (NHTSA) are proposing to weaken key fuel economy and greenhouse gas emissions standards for future vehicle models. In October, we highlighted our concerns with some of the economic analysis supporting the proposal. The Alliance of Automobile Manufacturers submitted comments that included economic analysis supporting the proposed rule prepared by NERA Economic Consulting and Trinity Consultants. In December, we wrote supplemental comments rebutting NERA and Trinity’s analysis, identifying serious flaws and unexplained departures from longstanding practices. NERA recently responded.

Our latest comments detail how NERA’s response does not address many of the problems we previously discussed. As our comments explain, the analysis relies on unreliable modeling and methodologies, for which NERA still has not provided critical details. NERA also misstates or fails to respond to our points on a number of topics, such as scrappage and fuel savings benefits. We point out the shortcomings in NERA’s response and provide more detail on each of the topics.

In October, we submitted comments to the National Highway Traffic Safety Administration (NHTSA) and Environmental Protection Agency (EPA) critiquing the proposed Safer Affordable Fuel-Efficient Vehicles Rule. We now have also submitted supplemental comments rebutting an analysis, prepared by NERA Economic Consulting and Trinity Consultants and submitted by the Alliance of Automobile Manufacturers, in support of the proposed rule.

In August 2018, the Trump administration issued a proposal to dramatically weaken federal emissions standards for cars and light trucks, and to revoke the waiver that allows California to set its own standards. Federal emissions standards have been enormously successful at reducing greenhouse gas pollution and lowering fuel costs for consumers, and we recently submitted five separate sets of comments detailing the flaws with the Trump administration’s proposal.

In December 2016, pursuant to the Inflation Adjustment Act of 2015, the National Highway Traffic Safety Administration (NHTSA) finalized a rule that adjusted civil penalties for car manufacturers that violate fuel economy standards, in order to line them up better with inflation. That rule put the penalties at $14 per tenth of a mile per gallon. NHTSA is now proposing a new rule to lower the penalties from $14 per tenth of a mile per gallon back to the previous rate of $5.50 per tenth of a mile per gallon, claiming that the $14 penalty would have a significant negative economic impact. Our May 2018 comments argue that NHTSA should explain why it is justified in reducing the penalty from $14 to $5.50 and consider the forgone benefits when considering whether the civil penalties will have a “negative economic impact.” Because NHTSA has not provided this explanation, the proposed reduction is arbitrary and capricious.

In 2017, the National Highway Traffic Safety Administration (NHTSA) suspended its 2016 Civil Penalties Rule, which adjusted the penalties for automobile manufacturer non-compliance with fuel economy standards for the first time in decades to reflect inflation. In issuing its suspension, NHTSA claimed that it was causing no harm. Our brief in the case challenging this suspension shows that NHTSA’s claim of no harm was inaccurate.

In December 2016, the National Highway Traffic Safety Administration (NHTSA) finalized a rule that updates civil penalties for car manufacturers that violate fuel economy standards. NHTSA is now reconsidering the rule, claiming it would have a significant negative economic impact. The agency provides no evidence that economic circumstances have changed since the rule’s finalization to make the rule more costly. Our comments argue that the agency should not proceed with the proposed reconsideration, because it inadequately explained why it changed positions. If the agency does continue with the reconsideration, both the Inflation Adjustment Act and economic cost-benefit analysis would justify an update to the penalties rates rather than maintaining the original penalty rate from 1975.

Vehicle fuel economy standards set by the National Highway Traffic and Safety Administration (NHTSA) help reduce greenhouse gas emissions in the United States by making cars more fuel efficient. Our comments on the reconsideration argue that NHTSA should value the social cost of those emissions as robustly as possible, as they have done in the past. We encourage NHTSA to consider the social cost of greenhouse gases in both the rule’s Environmental Impact Statement and Regulatory Impact Analysis, and that it should use estimates considering global damages of climate change using a three percent or lower discount rate.

We recently submitted two sets of comments to the EPA and National Highway Traffic Safety Administration on their greenhouse gas standards for trucks.

The DOT and EPA finalized fuel efficiency standards today for cars and light duty trucks, increasing fuel efficiency to 54.5 mpg by Model Year 2025. The agencies calculate that consumer savings under the new standards will be comparable to lowering the price of gasoline by $1 per gallon by 2025.