Carmakers may sue California on new emissions plan


By Poornima Gupta

DETROIT, June 15 (Reuters) - Automakers are considering challenging in court California's plan to require vehicles sold in the state to cut greenhouse gas emissions almost 30 percent, an industry group said on Tuesday.

The draft plan of California, which accounts for nearly 13 percent of the U.S. auto market, would phase in reductions of gases linked to global warming in two steps for cars and trucks sold in the state from 2009 through 2014.

The automakers believe the state's plan, which comes at a time when U.S. gasoline prices are close to record highs, would raise vehicle prices by forcing them to boost fuel economy.

"It is illegal," said Eron Shosteck, spokesman for the Alliance of Automobile Manufacturers. "States cannot set their own fuel economy standards."

The new proposal is likely to add "thousands of dollars" on each vehicle, Shosteck said.

The alliance represents nine automakers including Detroit's Big Three, whose profits come mostly from sales of low-mileage sport utility vehicles and pickup trucks.

To cut emissions, automakers must improve fuel efficiency since greenhouse gases such as carbon dioxide cannot be filtered from vehicle exhausts.

General Motors Corp. and DaimlerChrysler have already fought California in the courts to delay clean-air regulations. In 2002, they won a court injunction that postponed California's plans to force automakers to sell a certain number of low-pollution vehicles.

Last year, GM and DaimlerChrysler dropped their lawsuit after California changed its policy to allow more hybrid vehicles, which use batteries to cut gasoline consumption.

Many automakers, including Detroit's Big Three, have plans to roll out hybrid vehicles.

Ford Motor Co. will launch its new Escape hybrid SUV, which gets an estimated 35 to 40 miles per gallon, later this summer and has plans to roll out others in the near future. Hybrid versions of the Chevy Silverado and GMC Sierra from GM, and Dodge Ram pickup truck from DaimlerChrysler's Chrysler Group are also scheduled to go on sale later this year.

Despite California's plan, fuel economy is still not on top of consumers minds, however, Shosteck said. "It still ranks behind cupholders."



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