California court issues Memorandum Opinion and Order

6/24/2008

A California Court today issued a Memorandum Opinion and Order; this order is a further step in the ongoing litigation between the State of California, the US EPA, and OEM manufacturers relating to California's effort to get US EPA to issue a waiver allowing California to require more stringent fuel economy standards than US EPA mandates. (Central Valley Chrysler-Jeep v. California Air Resources Board, et al. rest of cite)

The Association of International Automobile Manufacturers and the Central Valley Chrysler-Jeep argued that previous court rulings put them in an uncomfortable position: invest in new technology that may never be used or face non compliance issues if the US EPA grants California the requested waiver that would permit increased greenhouse-gas regulations for certain new vehicles beginning with MY 2009.

The Court believes that the choice to invest in technology is a business decision with which the courts have no concern or basis upon which to rule.

This decision is a setback for manufacturers who hope to invalidate California's law.  As it stands, if the waiver is granted by the US EPA, manufacturers will have 45 days to comply with the increased emission requirements.  Based on actions to date, it appears that California will push until the waiver is granted.