A recent Automotive News report claims Tesla is pushing the Biden Administration, as well as a US appeals court, to initiate penalties for automakers that fail to comply with fuel economy requirements.
Reportedly, the US-based electric automaker already had a virtual meeting with the National Highway Traffic Safety Administration (NHTSA) on August 30, 2021. Prior to that, on August 8, NHTSA said via Automotive News that it may begin to seek larger penalties “for prior model years for automakers failing to meet fuel efficiency requirements but will first consider public comments.”
While the US, as well as the whole world, could stand to benefit in a huge way if NHTSA moves forward with such a plan, Tesla would also benefit. Since the carmaker only produces electric cars, it doesn’t have to worry about fuel economy. Moreover, it can sell credits to other automakers that are out of compliance. However, Tesla notes that the current requirements put into place by the Trump Administration make the credits less valuable.
Other automakers have been pushing back against an updated plan, saying it would cost them some $1 billion per year in order to not only meet more stringent policies, but also to purchase the credits from Tesla.
According to a government memo related to NHTSA’s contact with Tesla, the brand says Trump’s loosening of requirements:
“…produces continuing uncertainty in investments and transactions across the industry, and any delays will continue to have deleterious effects on the credit market until the issue is resolved.”
“The uncertainty perpetuated by NHTSA’s sluggish rulemaking pace is thus compounded by the likelihood of yet another round of litigation.“
On August 27, Tesla reached out to the Second Circuit US Court of Appeals to request prompt action. The court had already denied Tesla’s request back in April 2021. A group comprised of representatives for Ford, GM, Toyota, and Volkswagen requested that the court reject Tesla’s request. Meanwhile, most of these automakers are currently promoting their upcoming onslaught of EVs.
The people representing the other automakers don’t believe Tesla’s credit situation should have any impact on the government’s decision. However, the fact that Tesla may benefit if the rules are made more stringent really has nothing to do with the fact that stricter fuel economy regulations are necessary to fight against climate change.
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