Ford says automakers should consider backing California emissions deal

Ford Motor Co is urging major automakers to consider backing a framework deal with California on vehicle emissions in a bid to reach industry consensus before President-elect Joe Biden takes office, according to a letter seen by Reuters on Monday.

Major automakers are set to discuss next steps at a virtual meeting of their auto trade association Tuesday, which comes a week after General Motors Co abruptly announced it would no longer back the Trump administration's ongoing effort to bar California from setting its own vehicle emissions rules.

In October 2019, GM joined Toyota Motor Corp, Fiat Chrysler Automobiles NV and other automakers in backing President Donald Trump in the California fight.

Ford, Honda Motor Co, Volkswagen AG and BMW in July 2019 struck a voluntary agreement with California on reducing vehicle emissions through the 2026 model years that would allow them to meet a single nationwide standard. The targets would be lower than Obama-era rules through but higher than the Trump administration's rollback.

In a previously unreported letter, Ford Americas President Kumar Galhotra on Wednesday said with Biden's win, the fight over Trump's effort to preempt California on vehicle emissions "is now, at least for the next set of years, essentially moot. The more relevant issue is thus the question of the standards."

Galhotra urged automakers "to actively consider embracing the California framework."

He added: "The Biden Administration will not let the Trump standards stand, and either by way of litigation and/or a regulatory reboot, the new team will move in a different, more stringent direction."

A Ford spokeswoman declined comment on the letter but said the California agreement "should be the foundation for new regulations as the Biden administration considers stronger fuel economy standards in 2021."

California Air Resources Board Chair Mary Nichols told Reuters this month the state's emissions agreement with automakers could serve as a "good template" for federal standards.

Senator Tom Carper, the top Democrat on the Environment and Public Works Committee, said "the rest of the automakers should end their challenges to state authority and embrace the California framework as the first step in setting standards that get us to where we need to be."

GM, Fiat Chrysler and Toyota declined comment on Ford's letter. Toyota said last week of the lawsuit that "given the changing circumstances, we are assessing the situation."