The Justice Department has opened an antitrust investigation into an environmental agreement between California and four major automakers, unnamed sources said Friday.
People familiar with the matter told Bloomberg and The New York Times that the Trump administration launched an inquiry into the deal with BMW, Ford Motor Company, Honda and Volkswagen of America. Under the deal, California and the four companies compromised on tailpipe emissions standards that are more stringent than what the Trump administration requires, but less so than the Obama administration.
Lawyers from the Transportation Department and Environmental Protection Agency sent a letter to California asking it to abandon the deal because it is “unlawful and invalid.” The Trump administration also is considering stripping California of its authority to set emissions regulations more strict than the federal government.
California and the four automakers came to the agreement in July, bypassing the Trump administration’s decision to roll back emissions regulations. The companies pledged to increase the average fuel economy of their vehicles to nearly 50 miles per gallon.
Under the pact, fuel economy and carbon emissions standards would rise nearly 4 percent every year from the 2022 model year through 2026.
Last year, the Trump administration moved to roll back Obama-era standards by nearly 25 mpg. Seventeen states sued in June to protect the emission standards.
Clyde Hughes contributed to this report.
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