Trump to Meet With Automakers as California Schism Grows

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(Bloomberg) -- Top automakers will meet with President Donald Trump at the White House in coming days amid growing concerns over the president’s policies on trade and a looming schism with California over environmental regulations.

The date hasn’t been set though plans are underway, two White House officials said. The officials asked not to be identified discussing the plans.

“When the White House wants to meet with us about our sector and policy, we welcome the opportunity,” said Gloria Bergquist, a spokeswoman for the Alliance of Automobile Manufacturers.

The meeting comes as the Environmental Protection Agency and National Highway Traffic Safety Administration are finalizing a proposal to overhaul vehicle efficiency standards enacted under President Barack Obama. The Trump administration announced in early April that vehicle fuel efficiency standards for model years 2022-2025 are too aggressive and must be revised.

On Tuesday, California Attorney General Xavier Becerra announced a lawsuit challenging the EPA’s decision.

The agencies plan to recommend freezing efficiency standards from model year 2020 through 2026 at 37 miles per gallon, according to details released Tuesday by Democratic Senator Tom Carper of Delaware of a draft of the NHTSA and EPA proposal.

Rolling back the federal standards without an agreement between Washington and California could lead to a messy legal battle and a patchwork of efficiency standards.

The nation’s most populous state administers its own tailpipe greenhouse gas standards that are aligned with EPA and NHTSA rules. A dozen other states adhere to California’s rules as well, which combined account for more than a third of U.S. auto sales.

The executives plan to encourage the president to agree with California on measured adjustments to the standards rather than a major rollback, said two of the people. The companies worry that an aggressive move by federal agencies to weaken the standards would lead to years of litigation with California and policy uncertainty, further complicating the long lead times required to plan vehicle portfolios, said the people, who asked for anonymity to describe sensitive industry discussions.

Trade issues will also be a focal point at the White House meeting. American trade officials and their counterparts from Mexico and Canada still haven’t agreed on changes to rules for auto manufacturing under the North America Free Trade Agreement.

©2018 Bloomberg L.P.

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