GM says it favors fuel-efficiency rules based on historic rates

Environment

FILE PHOTO: The GM logo is seen at the General Motors Lansing Grand River Assembly Plant in Lansing, Michigan October 26, 2015. REUTERS/Rebecca Cook/File Photo

WASHINGTON (Reuters) – General Motors Co (GM.N) said it favors an annual increase in fuel-efficiency standards based on “historic rates” rather than tough Obama era rules or a Trump administration proposal that would freeze requirements.

In a federal filing made public on Monday, the largest U.S. automaker said the Obama rules that aimed to hike fleetwide fuel efficiency to more than 50 miles per gallon by 2025 are “not technologically feasible or economically practicable.

The Detroit automaker said that since 1980, the motor vehicle fleet has improved fuel efficiency at an average rate of 1 percent a year. GM did not immediately comment on whether it was calling for a specific figure.

GM also said in its comments it was “troubled” that the administration of President Donald Trump wants to phase out incentives for electric vehicles after the 2021 model year.

The Trump plan’s preferred alternative would freeze standards at 2020 levels through 2026 and hike U.S. oil consumption by about 500,000 barrels per day by the 2030s but reduce automakers’ collective regulatory costs by more than $300 billion. The proposal would bar California from requiring automakers to sell a rising number of electric vehicles or setting state emissions rules.

The administration of former President Barack Obama had adopted rules, effective in 2021, calling for an annual increase of 4.4 percent in fuel-efficiency requirements from 2022 through 2025.

GM has been lobbying Congress to lift the existing cap on electric vehicles that are eligible for a $7,500 tax credit. The credit phases out over a 12-month period after an individual automaker hits 200,000 electric vehicles sold.

GM said in its written comments the current tax credit puts “companies like GM and Tesla (TSLA.O) at severe pricing disadvantage in the market for several years.” On Friday, GM called for a nationwide zero-emission vehicle program, while 20 U.S. states called for the administration to abandon its proposal to weaken the Obama rules.

The GM proposal also calls on the federal government to establish a national building code to require all new residential construction to support EV charging and dramatically increase U.S. government spending on research and development in battery cell technologies.

Reporting by David Shepardson in Washington; Editing by Matthew Lewis

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