General Motors CEO Mary Barra Calls for National Fuel Economy Standard

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【Summary】With a meeting involving Donald Trump, automakers, and CEOs on the horizon, GM’s Chairman Mary Barra expressed wishes for a national fuel economy standard.

Original Vineeth Joel Patel    Jun 26, 2018 5:30 PM PT
General Motors CEO Mary Barra Calls for National Fuel Economy Standard

One of the first things the Trump administration called for was to the change the previous administration's fuel economy regulations. At the beginning of April, the Environmental Protection Agency (EPA) confirmed that it was making changes to the Obama administration's corporate average fuel economy (CAFE) standards. Scott Pruitt, the EPA Administrator, didn't provide specifics on how things would change. The only thing that's for certain, is that companies won't have to have an average fuel economy of roughly 50 mpg by 2025. 

While some automakers stated that they would continue to follow the Obama's administrations' fuel economy requirements, others have been actively lobbying for lower fuel economy regulations. Despite claiming that it's pushing for an electric future, General Motors was one of the first to lobby for more relaxed fuel economy regulations. And it looks like GM is continuing to push for lower standard, but this time, it's for the entire nation. 

GM Calls For Nationwide Standards

As The Detroit Free Press reports, GM CEO Mary Barra and other CEOs from the automotive industry are planning to meet with President Donald Trump in the near future. Specifics for the roundtable have not been made public yet, but the outlet claims that lower fuel economy standards will certainly be a topic of discussion. 

In a LinkedIn article, Barra stated that GM has an "absolute and unwavering" commitment to improving fuel economy, reducing emissions and investing in electric vehicle technology, reports the outlet. The CEO also voiced her concerns on climate change, which she stated were real and made it clear that "the transportation sector is a contributor." 

While all of this makes it sound like Barra and GM are all about improving the fuel efficiency of their vehicles, the CEO backtracked shortly after, claiming the automaker wanted a national standard. As The Detroit Free Press points out, the focus on having a national fuel-economy standard highlights a potential conflict between the Trump Administration and the state of California. Regulators in the state wants to follow the previous administration's regulations, while the Trump administration wants to rewrite the entire book. 

"General Motors supports establishing one national set of fuel efficiency requirements, with flexibilities that take into consideration recent industry developments such as vehicle sharing and self-driving electric vehicles," wrote Barra in the LinkedIn post. 

Why Have A National Standard?

Barra believes that a national standard would put the focus on consumers and societies. "A single, national standard would allow us to focus our resources on innovations that benefit our customers and society as we pursue our vision of a world with zero crashes, zero emissions and zero congestion, instead of diffusing resources to meet different rules within the United States," stated Barra. 

Whether the Trump Administration sides with GM and other automakers in making one national fuel-economy standard remains to be seen. If the EPA does revisit the Obama Administration's proposed standards, it will be interesting to see how many automakers stick to the old regulations, as more brands create global vehicles. The United States may be okay with having vehicles that aren't as fuel efficient, but increasing gas prices and emissions in the rest of the world is requiring automakers to meet even tougher regulations. 

Unlike GM that wants a rollback of the previous administration's fuel-economy regulations, its cross-town rival, Ford, isn't interested in lower regulations. Instead, the automaker previously stated that it would stick to the Obama Administration's standards. Ford, as its president and CEO, Bill Ford, stated earlier, was interested in reducing greenhouse gas emissions and would work to meet the regulations that Pruitt stated were "not appropriate." The automaker, though, also wants every automaker to follow a nationwide standard. 

In an earlier statement, Ford Corporate Social Responsibility spokesman John Cangany stated, "We believe climate change is real, and we remain committed to doing our part to stabilize C02 in the atmosphere." He also went on to state, "We continue to support increasing clean car standards through 2025 and are not asking for a rollback. Importantly, we want one set of standards nationally, along with additional flexibility to help us provide more affordable options for our customers." 

Barra and GM's decision to request President Trump and the EPA to come out with a national standard will definitely hurt the rollout of electric vehicles and hybrids. If automakers aren't being pushed to make fuel-efficient vehicles, why would they invest the money and time to develop more efficient cars? The CEO may believe that climate change is real and wants to solidify its role as a leader in electric vehicles, but a national standard, especially one that isn't difficult to meet, wouldn't push GM to plan for the future. 

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