What the Ongoing ‘Deregulation’ of Auto Emissions Really Means—If Anything

The U.S. government will finalize plans for a new suite of far less-ambitious automotive emissions standards Monday, capping what the administration has touted as one of the greatest automotive de-regulatory pushes in the nation’s history. That last bit may be accurate, technically speaking, but despite the grandiose language, what it actually means for most car buyers right now is approximately diddly squat.

There are two main reasons why. First, the carrot. We live in a complex global economy, and federal emissions standards are only one piece of a much more complex regulatory climate (if you’ll forgive an unintended pun). Something legal at the federal level may still be illegal in a CARB state, let alone a foreign country.

This forces automakers to make an uncomfortable decision: A) Produce one car that satisfies all markets, or B) Build multiple, region-specific models to best exploit each individual microclimate. America’s current political instability makes this decision even more fraught. Choices based on today’s regulations may have dire consequences tomorrow; look no further than the EV subsidy rug-pull if you need evidence.

Nine times out of 10, they’re going with option A. Why? If you’ve paid attention to manufacturing and marketing trends in the industry, you know automakers have moved away from à la carte options in favor of bundling desirable features into larger trims and packages.

That stuffing accomplishes two things: it lets automakers justify gouging customers for the options they actually want by giving them a bunch they don’t, and it reduces the number of distinct ways a car can be built. Reducing the number of configurations an automaker has to build is a huge win for manufacturing efficiency. Put another way, choice = bad; efficiency = good.

So, that eliminates the carrot. Now, what’s the stick? Well, that’s the thing. Right now, there isn’t one. Oh, sure, federal emissions standards exist on paper, but CAFE has been rendered impotent because the EPA is no longer empowered to collect fines from those who exceed prescribed limits. Violating the standards may still be illegal, but accountability has been eliminated from the equation.

Until that changes, any new U.S. emissions regulation (or de-regulation) is meaningless—just like any promise of reduced cost for consumers.

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