Canadian Legislative News
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In a continentally integrated industry such as North American automaking, rules made in one country have an impact beyond borders, and the industry in Canada has fought to achieve common North American environmental regulations to avoid disparities seen by the manufacturers as unworkable.
In early April, U.S. Environmental Protection Agency (EPA) administrator Scott Pruitt made official the widely anticipated news that the Trump Administration will push to ease the stiffening of automotive fuel-economy regulations for the 2022 through 2025 model years.
The previous regulations – as well as consumer demand – have resulted in modern vehicles that are cleaner and more fuel efficient than ever before. However, rules which were determined earlier in the decade were considered onerous by the auto manufacturing industry, especially given that the formula to arrive at an automaker’s Corporate Average Fuel Economy level depends on the mix of vehicles that consumers buy, not what the manufacturers make.
Today’s cars are much more fuel efficient and consume far less fuel by design, often causing consumers to opt for larger vehicles as the operating cost spread between small and larger cars is a fraction of what it once was. For years in Canada, truck sales have been growing by close to 10 percent-per-year, while car sales have been declining sharply.
In light of the United States' decision to reverse efficiency benchmarks, Canada will have to make a decision about maintaining parity and also reversing fuel economy goals, or to break with longstanding practices.
