Trump Administration Launches Legal Attack on 🚗 Carmakers' Fuel-Economy Deal with California

  |   Donald Trump

The Trump administration warned California on Friday that its deal with four automakers to increase mile-per-gallon standards for cars violates federal law.

In a letter to the California Air Resources Board, officials for the U.S. Environmental Protection Agency and Department of Transportation said the deal struck with Ford, Volkswagen, BMW and Honda "appears to be inconsistent with federal law" that gives the administration "and not California or any other state" authority to set fuel standards.

It warned CARB Chair Mary Nichols that the agreements "may result in legal consequences" if they move forward, though the letter wasn't specific about what those consequences might be.

At the same time, the Wall Street Journal reported that the US Department of Justice is examining potential antitrust violations in the carmakers' agreement with California.

The federal law enforcement agency is probing whether the four companies violated federal competition laws by agreeing with each other to follow tailpipe-emissions standards that exceed what's sought by President Donald Trump, sources close to the probe told the Journal.

California Gov. Gavin Newsom said in a Twitter post that the Trump administration is engaging in "blatant political interference " and "attempting to rig our legal system and scare carmakers."

In July, the automakers reached an agreement with the CARB to increase average fuel standards for new vehicles to nearly 50 mpg by model year 2026. They also notably recognized what they considered California's authority to set standards for it and a handful of other states that have adopted them.

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