U.S. light-duty mileage standards amended

By Mike Kastner, NTEA Managing Director
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This article was published in the May 2020 edition of NTEA News.

At the end of March, Environmental Protection Agency (EPA) and National Highway Traffic Safety Administration (NHTSA) jointly issued final rules to amend existing greenhouse gas (GHG)/mileage (CAFE) standards for model year 2021 and later light-duty vehicles. These new rules do not affect existing Phase 2 GHG and mileage standards for medium- and heavy-duty trucks, but could serve as a template for a single national set of standards in the future.

In the new rule

  • “Light-duty vehicle” is defined as a passenger car;
  • “Light-duty truck” is defined as a pickup truck, sport-utility vehicle or minivan up to 8,500 pounds gross vehicle weight rating (GVWR); and
  • “Medium-duty passenger vehicle” is defined as a sport-utility vehicle or passenger van from 8,500–10,000 pounds GVWR.

The final rule will increase stringency of CAFE and CO2 emissions standards by 1.5% each year through model year 2026, as compared to standards issued in 2012, which would have required about 5% annual increases. Under the rule, the projected overall industry average required light-duty fuel economy in model years 2021–2026 is 40.4 miles per gallon, compared to the 46.7 mpg projected requirement in model year 2025 under the 2012 standards.

“This rule reflects the Department’s #1 priority — safety — by making newer, safer, cleaner vehicles more accessible for Americans who are, on average, driving 12-year-old cars. By making newer, safer and cleaner vehicles more accessible for American families, more lives will be saved and more jobs will be created,” said U.S. Secretary of Transportation Elaine L. Chao. 

According to EPA Administrator Andrew Wheeler, “Our final rule puts in place a sensible one national program that strikes the right regulatory balance that protects our environment and sets reasonable targets for the auto industry. This rule supports our economy, and the safety of American families.”

It’s expected legal challenges to the new rule will be filed. Learn more about the Safer Affordable Fuel-Efficient Vehicles Rule at nhtsa.gov/safe.

Medium- and heavy-duty
As mentioned, the new EPA and NHTSA rule is applicable to light-duty vehicles. Medium- and heavy-duty vehicles will continue to comply with Phase 2 standards of 2016.

The truck rules began in 2011 with Phase 1. At that time, EPA and NHSTA jointly issued the first-ever GHG emissions and fuel economy standards for medium- and heavy-duty trucks for model years 2014–2018. In 2016, EPA and NHTSA jointly finalized Phase 2 standards
for model year 2021–2027 medium- and heavy-duty vehicles.

The truck rules differentiate between tractors, vocational trucks, large pickups and vans, and as included in Phase 2, trailers. The trailer regulations have not yet taken effect in either U.S. or Canada due to pending legal challenges.

Phase 2 medium-/heavy-duty 2016 rules — affected vehicles

  • Heavy-duty combination tractors. Combination tractors — Class 7 and 8 semitrucks that typically pull trailers — are regulated under subcategories based on weight class, cab type and roof height.    
  • Class 2b–3 heavy-duty pickup trucks and vans. Heavy-duty vehicles with a GVWR between 8,501 and 10,000 pounds are classified as Class 2b motor vehicles or Class 3 for a GVWR between 10,001 and 14,000 pounds. Class 2b and 3 heavy-duty vehicles are referred to in these rules as “HD pickups and vans.” Heavy-duty pickup and van standards are based on a “work factor” attribute that combines a vehicle’s payload, towing capabilities and presence of four-wheel drive.  
  • Vocational vehicles. Specialized vocational vehicles, which consist of a wide variety of truck and bus types, are regulated in three subcategories based on engine classification. They represent approximately 17% of fuel consumption and GHG emissions from medium- and heavy-duty vehicles.
  • Trailers. These are trailers used in combination with tractors, including all lengths of dry vans, refrigerated vans, tanks, flatbeds and container chassis hauled by low, mid and high roof day and sleeper cab tractors.
  • Heavy-duty engines. Like Phase 1, Phase 2 rules have separate standards for tractor engines, vocational diesel engines and vocational gasoline engines.

Delegated assembly
In Phase 2, NTEA was instrumental in obtaining a new compliance pathway that could be beneficial to members. EPA rules typically apply to engine manufacturers and OEMs. NTEA discussed with EPA the fact that many multi-stage manufacturers are capable of adding equipment that could reduce GHG emissions and increase fuel economy. The regulations as originally written, however, did not provide for recognition of such multi-stage manufacturer actions.

EPA recognized the value of incentivizing multi-stage manufacturer contribution to GHG and fuel use reduction by including a provision that would allow multi-stage manufacturers to contractually coordinate with OEMs to add parts or equipment that could contribute to OEM compliance efforts.

The process, known as delegated assembly, will require

  • The OEM (certificate holder) to have a private contractual obligation with the secondary manufacturer to properly complete the assembly.
  • Recordkeeping to demonstrate compliance.
  • Application of a temporary label to partially complete vehicles.
  • Other reasonable steps to ensure assembly is completed properly.
  • A description in the certification application of how this allowance will be used.

Canada heavy-duty regulations
Government of Canada released in May 2018 its version of Phase 2 Heavy-duty Vehicle and Engine Greenhouse Gas Emission Regulations. These primarily mirror EPA Phase 2 GHG regulations. In those regulations, NTEA secured a better estimated payback period for vocational trucks from that which was originally proposed.

It’s estimated Canadian regulations will result in cost recovery to occur in year three of ownership for heavy-duty pickup trucks and vans and vocational vehicles, and in year four of ownership for tractor-trailers.

NTEA also clarified with Government of Canada the delegated assembly concept in the U.S. regulations would be available to NTEA member multi-stage vocational vehicle manufacturers in Canada.

One national standard
As a part of EPA’s and NHTSA’s efforts amending the light-duty regulations, the administration moved forward to secure one national standard. Currently, California issues separate standards, which other states can adopt. This resulted in two standards for manufacturers to meet.

In September 2019, the agencies finalized and issued the first part of the SAFE rule, which makes clear there should be only one national and uniform regulation concerning tailpipe GHG emissions standards and zero-emission vehicle (ZEV) mandates. In the rule, NHTSA affirms its sole authority to set national fuel economy standards.

One National Program Rule revokes the preemption waiver previously granted to California that allowed the state to set its own regulations on GHG and ZEV for cars and light-duty trucks.

California and a number of other states and cities filed suit challenging the EPA and NHTSA action the next day.

While the new rule does not affect the medium and heavy truck Phase 2 GHG and fuel efficiency regulations approved by EPA and NHTSA, the precedent could ultimately benefit truck manufacturers seeking to build engines and vehicles to one national standard in the future.

NTEA supports the concept of national and uniform regulations for vocational trucks.

Learn more at ntea.com/advocacy.