UPDATE 1-Trump to Meet with Automakers to Discuss U.S. Fuel Rules -Sources

by David Shepardson (Reuters) The White House is planning a meeting next week between President Donald Trump and senior leaders of major U.S. and foreign automakers to discuss planned fuel efficiency rule changes through 2026, automakers and administration officials said on Wednesday.

The meeting, expected on May 11 with chief executives and other senior executives of large automakers, comes as the Trump administration has drafted a proposal that would freeze fuel efficiency requirements at 2020 levels through 2026.

General Motors Co, Ford Motor Co, and Toyota Motor Corp are among at least a dozen automakers expected to attend the meetings.

Automakers want rule changes to address lower gasoline prices and the shift in U.S. consumer preferences to bigger, less fuel-efficient vehicles, but also want the administration and California to reach agreement on national standards. READ MORE

Excerpt from Politico's Morning Energy: Trump is also scheduled to meet Friday with automaker CEOs for a roundtable event at the White House. Reuters reports that CEOs from General Motors, Ford and Toyota are among the companies invited. The meeting comes at a crucial time for the administration, given its plans to roll back greenhouse gas emissions standards for cars. Several states have already sued EPA over the move, but it notably came after automakers lobbied the Trump administration to revisit the 2022-25 emissions standards. Automakers had indicated they simply wanted more flexibility to reach the ultimate emissions goals in 2025, complaining that would be difficult to meet the Obama-era goals that would have ultimately lifted the average fuel economy target for the nation's fleet of cars and light trucks to 55 miles per gallon by 2025. Bloomberg reported last week that "executives plan to encourage the president to agree with California on measured adjustments to the standards rather than a major rollback" during this week's meeting. READ MORE

Excerpt from Politico's Morning Energy: The Alliance of Automobile Manufacturers and the Global Automakers, trade associations which together represent most of the automakers who sell cars in the U.S., will tell Trump that they most definitely want increases in fuel efficiency standards, contra that zero increase preference of the Department of Transportation. They also want the federal government to work out a single national standard with California, rather than face either a bifurcated market or a long legal battle. "Automakers are deeply committed to increased fuel economy and safety measures that meet the needs of our customers, and we expect to share the importance of government policies that provide certainty to the auto sector, continue to reduce greenhouse gas emissions, reflect what consumers will buy and result in a national policy that includes California," the two groups said in a statement. READ MORE

Excerpts from Politico's Morning Energy: Competing voices will be on full display today, while President Donald Trump meets with automakers who will plead their case on fuel efficiency standards. The goal for automakers: Beat back the National Highway Traffic Safety Administration's strict plan and persuade the White House to reach a compromise with California. Top executives from Ford, General Motor and Toyota, as well as the Alliance of Automobile Manufacturers and the Global Automakers, will warn that NHTSA's plan would lead to a market split, creating uncertainty across the country.

Wait, what's going on? The Transportation Department, which found itself in the backseat during the Obama administration, has switched roles with EPA under Trump, meaning NHTSA has been driving the internal debate over what to do about the Obama-era rules, Pro's Eric Wolff reports. "Under Obama, EPA set the [greenhouse gas] standard, and NHTSA had to harmonize with it," said a source who opposes the weakening the standards. "Under Trump, NHTSA is using the CAFE standard as the locomotive, and EPA's GHG standards will be the caboose."

Automakers have said the Obama rules are too onerous for them to meet, but they also worry the Trump administration may go too far. The most aggressive option now under consideration would freeze fuel efficiency standards at 2020 levels and revoke California's authority to set its own greenhouse gas limits on tailpipe emissions. If that were to move forward, the administration would find itself in a legal battle with California and a host of states, who have prevailed in court in the past. Most in the industry do support tighter standards for the coming years, but phased in over a longer time period — an argument they'll try to make to Trump today. Read more here.

MAIL CALL! CAFE EDITION: Ahead of today's meeting, three members of the Trump transition wrote to the president asking him to stay the course on the CAFE standards. "Your efforts to reform this mandate are about cost, consumer choice, and whether or not your administration or the State of California gets to set a national policy," Myron Ebell, who led the transition at EPA; Shirley Ybarra at Transportation; and Thomas Pyle at DOE write in a letter.

But in their own letter, environmental leaders wrote to automakers, calling on them to "stand with the majority of Americans who want cleaner, more fuel efficient cars and cleaner air." And, Democratic Sen. Ed Markey called on companies Thursday to keep the fuel economy emissions standards that they previously negotiated in his own letter here. READ MORE