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Illustration: Sarah Grillo/Axios

There's stark new evidence that big automakers are divided over how to navigate White House moves to upend mileage and carbon emissions policies.

Driving the news: GM, Toyota, Fiat-Chrysler and others are now backing the Trump administration's move to yank California's power to impose CO2 rules — and by proxy mileage rules — that exceed federal standards.

  • Monday night's move to intervene in litigation on the matter splits them from Ford, VW, Honda and BMW — the quartet that struck a deal with California on toughening standards through the mid-2020s.

The intrigue: Axios' Joann Muller points out that where automakers stand largely depends on their future product pipeline and where they think the market is headed.

  • Volkswagen is betting heavily on electric vehicles in the wake of its diesel emissions scandal. Ford is aligned with VW.
  • Honda is already the industry’s most fuel-efficient carmaker.
  • GM, on the other hand, doesn't think California's plan provides enough EV emissions credits to offset the sale of high-margin pickups it needs to finance its bets on future technologies like autonomy.
  • Some foreign automakers, especially, are worried about angering Presdient Trump, who is still weighing big tariffs on auto imports that could wreak havoc on their business.

Why it matters: California is the nation's biggest auto market and about a dozen states follow its lead on emissions rules.

  • Automakers want to avoid a split national market, but they're at odds over how to get there — and how stringent the single standard should be.
  • Plus, transportation is the nation's largest source of greenhouse gas emissions.
  • The auto industry started balking a few years ago at stringent Obama-era standards that extend through 2025, but they don't like the draft 2018 White House plan to freeze the standards, and instead say there should be some level of annual increases.

What they're saying: "The automakers that made a previous deal with California may be questioning their actions if Trump wins a second term and successfully revokes California’s ability to set its own standards," Autotrader executive publisher Karl Brauer tells Axios.

  • "Ultimately there’s no clear path here, and every manufacturer taking a position on this topic risks being on the losing side when it’s finally resolved," he said.

What's next: Look out for final EPA and Transportation Department rules to revise the Obama-era standards.

  • EPA has hinted that the final version require slight increases.
  • But that's extremely unlikely to satisfy California regulators, allied states and environmentalists, so look for this battle to drag on.

The state of play: A new note from the Rhodium Group helps explain why there's so much interest in the Trump vs. California fight — especially as it applies to the electric vehicle industry.

What they did: The research firm modeled two scenarios out to 2035.

  1. Keeping Obama-era rules and California's waiver, which enables the state and others that follow its lead to adopt its zero-emissions vehicles rule.
  2. Revoking the California waiver and implementing Trump's plan to freeze the Obama-era standards.

What they found: Freezing the standards and yanking the waiver would knock 7%–8% off nationwide ZEV sales — largely electric models — in 2035 relative to keeping the programs.

  • That means 12–14 million fewer ZEVs on the nation's roads in 2035 compared to keeping the tougher rules, Rhodium said.
  • Three-quarters of the sales reduction stems from weaker mileage rules, while the balance is from rolling back the California ZEV rule.

The bottom line: It underscores how policy is a key driver of EV adoption rates, even as more — and more affordable — models enter the market.

Go deeper

45 million Americans under winter storm watches near New England

Computer model projection showing the winds moving around the powerful East Coast storm on Saturday Jan. 29, 2022. Image: https://earth.nullschool.net

Nearly 45 million Americans are under winter weather alerts and warnings from North Carolina to northeastern Maine, as a major winter storm threatens the region.

Why it matters: It is predicted to be the biggest blizzard since 2018 to strike the Northeast with more than 2 feet of snow possible in parts of eastern Massachusetts, according to the National Weather Service.

2 hours ago - World

Australian PM pledges $700M for climate change-threatened Great Barrier reef

A green sea turtle is flourishing among the corals at Lady Elliot island in Australia's Great Barrier Reef. Photo: Jonas Gratzer/LightRocket via Getty Images

Australian Prime Minister Scott Morrison announced Friday a AU$1 billion ($703 million) investment plan for the Great Barrier Reef.

Why it matters: The nine-year plan for projects including water quality improvement, reef conservation and supporting some 64,000 tourism jobs comes months ahead of this year's federal election. It has been criticized by scientists and environmental groups for failing to tackle climate change.

Judge nixes Gulf of Mexico oil leases in climate-focused ruling

Tug boats prepare to tow the semi-submersible drilling platform Noble Danny Adkins through the Port Aransas Channel into the Gulf of Mexico on December 12, 2020 in Port Aransas, Texas. Photo: Tom Pennington/Getty Images

A federal judge on Thursday canceled the Biden administration's late 2021 sale of new oil-and-gas drilling leases in the Gulf of Mexico.

Why it matters: The ruling that the greenhouse gas emissions analysis by the Interior's Bureau of Ocean Energy Management (BOEM) was insufficient is a win for green groups that challenged the decision, as they seek to curb fossil fuel production.

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