General Motors abandons Trump in lawsuit fighting California on its own climate rules and vows to work on crisis with Biden

CEO of the automaker, Mary Barra, said the company agrees with president-elect Joe Biden's plan to expand electric vehicle use

General Motors is abandoning the Trump administration in a lawsuit that aimed to end California's right to set its own clean-air standards.

CEO of the automaker, Mary Barra, said in a letter on Monday to environmental groups that GM will pull out of the lawsuit, and it urges fellow manufacturers to join them.

She said the company agrees with President-elect Joe Biden's plan to expand electric vehicle use. Last week, GM said it is testing a new battery chemistry that will bring electric-vehicle costs down to those of gas-powered vehicles within five years.

Barra sent the letter after a conversation with Mary Nichols, head of California's Air Resources Board, the company said. The board is the state’s air pollution regulator.

“We believe the ambitious electrification goals of the President-elect, California, and General Motors are aligned, to address climate change by drastically reducing automobile emissions,” Ms Barra said in the letter.

Nichols called GM’s announcement good news. "I was pleased to be in communication with Mary Barra again,” she said. “It’s been a while since we had talked.”

Ms Barra tweeted on Monday: "We have reached an important inflection point at@GM. We are transitioning to an all-electric portfolio, and doing so from a position of unprecedented strength. This is how we will win."

Last week, president-elect Biden and vice president-elect Kamala Harris met with business leaders to discuss economic recovery following the Covid-19 pandemic. 

Along with CEOs from Target, Microsoft, and other large corporations, was Ms Barra. 

Dan Becker of the Center for Biological Diversity, one of the environmental groups Ms Barra wrote to, said GM was wrong in trying to stop California from protecting its people from auto pollution.

“Now the other automakers must follow GM and withdraw support for (President Donald) Trump’s attack on clean cars,” he said in an email to AP.

The White House did not immediately respond to an email seeking comment from The Independent.

The Department of Justice declined to comment.

In a statement, the Biden-Harris transition said: "GM’s decision reinforces how shortsighted the Trump Administration’s efforts to erode American ingenuity and America’s defenses against the climate threat truly are. 

“In addition to advancing our ambitious climate goals, this decision will have a positive ripple effect as our nation strives to outcompete our global competitors, create good-paying union jobs here at home, and reclaim our place as leaders in innovation and manufacturing — all of which will be priorities in my administration.”

Ron Klain, Biden’s incoming chief of staff, wrote on Twitter that he is glad to see the president-elect’s leadership “is already encouraging progress.”

Last year General Motors, Fiat Chrysler, Toyota and 10 smaller automakers sided with the Trump administration in a lawsuit over whether California has the right to set its own standards for greenhouse gas emissions and fuel economy.

The companies said they would intervene in a lawsuit filed by the Environmental Defense Fund against the Trump administration, which has rolled back national pollution and gas mileage standards enacted while Barack Obama was president.

The group called itself the “Coalition for Sustainable Automotive Regulation” and also included Nissan, Hyundai, Kia, Subaru, Isuzu, Suzuki, Maserati, McLaren, Aston-Martin and Ferrari.

“With our industry facing the possibility of multiple, overlapping and inconsistent standards that drive up costs and penalize consumers, we had an obligation to intervene,” John Bozzella, CEO of Global Automakers and spokesman for the coalition, said at the time.

The coalition did not immediately respond to The Independent’s request for comment.

Toyota, one of the big automakers in the coalition favoring the Trump standards, said on Monday it is reconsidering its position.

In a statement, the company said it has supported year-over-year increases in fuel economy standards, and it joined the coalition because most other automakers agreed there should be a single US standard.

“Given the changing circumstances, we are assessing the situation, but remain committed to our goal of a consistent, unitary set of fuel economy standards applicable in all 50 states," Toyota said.

The initial move put the coalition automakers at odds with five other companies — BMW, Ford, Volkswagen, Volvo and Honda — that backed California and endorsed stricter emissions and fuel economy standards than proposed by the Trump administration.

But the coalition’s stance was not so straightforward. For instance, although it opposed California, it still wanted Trump and the state to compromise on one national regulation.

Last September, Trump announced his administration would seek to revoke California’s congressionally granted authority to set standards that are stricter than those issued by federal regulators.

The move came after Ford, BMW, Honda and Volkswagen signed a deal with the California Air Resources Board, which had been at odds with the Trump administration for months.

Many automakers have said in the past that they support increasing the standards, but not as much as those affirmed in the waning days of the Obama administration four years ago.

Under the Obama administration requirements, the fleet of new vehicles would have to average 30 mpg in real-world driving by 2021, rising to 36 mpg in 2025. Those increases would be about 5 per cent per year. The Trump administration’s plan increased fuel economy by 1.5 per cent per year, backing off an earlier proposal to freeze the requirements at 2021 levels.

Automakers say that because buyers are switching to larger trucks and SUVs, many companies would not be able to meet the stricter standards.

Shares of GM rose nearly 5 per cent to $45.11 in Monday afternoon trading.

Associated Press contributed to this report. This article has been updated