GM's Mary Barra Commits to Cleaner Engines, Yet Relaxed Regulations Encourage More Fuel-Consuming Vehicles | Carscoops

      Mary Barra asserts that GM continues to focus on efficiency and electric vehicles (EVs), despite relaxed U.S. standards changing incentives.

      GM commits to enhancing engine efficiency, even as federal regulations become less stringent.

      The relaxation of rules might lead automakers to prioritize more profitable trucks and SUVs.

      Barra affirms GM's dedication to EVs, despite a decline in sales following the end of tax credits.

      This year has been unusual for car manufacturers, but many have recently found favorable conditions. The EPA has essentially removed penalties for failing to meet fuel economy targets, which could easily lead to a resurgence in high-margin full-size trucks and SUVs.

      With reduced regulatory pressure, engines are not required to be cleaner or more efficient; nevertheless, GM CEO Mary Barra declares that the company will continue to drive advancements in engine technology.

      She asserts that GM will seek to enhance every combustion engine it invests in, regardless of current regulations. However, it remains to be seen if this commitment will persist if the market increasingly favors larger, more profitable gas-consuming vehicles.

      How Long Will Progress Endure?

      Innovation is undoubtedly crucial for all automotive manufacturers, so the assurance of ongoing development is encouraging on paper. That’s what Barra conveyed during her appearance at the New York Times DealBook Summit on Wednesday, stating, “Every engine we invest in, we strive for significant improvement.”

      It's evident that stricter fuel economy regulations have resulted in significant costs for carmakers. A recent report suggests that many of the more significant recalls in the past two years are linked to these regulations.

      The question of whether GM and other manufacturers will continue to aggressively pursue fuel economy improvements is an important consideration.

      What’s the Current Incentive?

      For many years, automakers have deliberately guided consumers towards larger SUVs and trucks, as they yield the highest profits and face less stringent fuel economy regulations.

      It remains uncertain why that strategy would shift now that penalties have been eliminated altogether. Nevertheless, Barra sees potential benefits from the new regulations.

      Barra also expressed support for Trump’s decision to remove California's tougher clean air authority, advocating instead for a single national standard that does not “get in front of the consumer.” However, it must be acknowledged that automakers have contributed to the current demand for SUVs, so this argument has its limits.

      The relaxation of rules also reduces pressure on EVs, which is conveniently timed for GM as its sales decline following the expiration of tax credits and its electric models remain unprofitable. Barra insists that the company remains committed to EVs.

      She took a more favorable stance on tariffs, describing recent policies as creating “a more level playing field” after years of inconsistent barriers. While GM may continue to improve engines, with less stringent regulations and a market focused on massive SUVs, it is challenging to envision Detroit moving away from its largest profit margins.