U.S. House panel to review DOJ automaker antitrust probe

By David Shepardson
An overall view of the assembly line where the BMW X4 is made at the BMW manufacturing plant in Spartanburg

By David Shepardson

WASHINGTON (Reuters) - The U.S. House Judiciary Committee plans to hold hearings and seek documents into the Justice Department's decision to open an antitrust investigation into four major automakers' voluntary agreement with California to adopt compromise vehicle emissions requirements.

House Judiciary Chairman Jerrold Nadler and Representative David Cicilline, who chairs a subcommittee on antitrust issues, said in a joint statement late on Monday the probe of Ford Motor Co <F.N>, Honda Motor Co <7267.T>, BMW AG <BMWG.DE>, and Volkswagen AG <VOWG_p.DE> "is only the latest in a profoundly troubling pattern of abuse of power that has flourished under the Trump presidency."

The Justice Department declined to comment. The White House did not immediately comment. The automakers did not immediately comment.

The two House Democrats added "there is virtually no antitrust theory that the Justice Department can use to prove that this agreement will unreasonably restrain trade or otherwise violate the antitrust laws."

Reuters and other outlets reported Friday the existence of the investigation as the Trump administration has ramped up its opposition to automakers seeking to sidestep it on rolling back Obama-era fuel-efficiency rules.

The antitrust division sent Aug. 28 letters to the four automakers saying the government was concerned the agreement "may violate federal antitrust laws" but adding it had "reached no conclusions," according to documents seen by Reuters.

In July, the four automakers said they had reached a deal to adopt standards that were lower than Obama-era rules but higher than the Trump administration's 2018 proposal.

The automakers were defying the Trump administration's effort to strip California of the right to fight climate change by setting its own standards.

Separately on Friday, general counsels at the Environmental Protection Agency told California Air Resource Board Chair Mary Nichols in a letter that its actions in connection with the voluntary agreement "appear to be unlawful and invalid."

Reuters reported on Thursday the administration was moving forward with plans to strip California of its waiver under the Clean Air Act to set its own vehicle emissions rules and requiring automakers to build an increasing number of zero-emission vehicles.

The Obama-era rules called for a fleetwide fuel efficiency average of 46.7 miles per gallon by 2026, compared with 37 mpg under the Trump administration's preferred option. The final regulation will modestly boost fuel efficiency over the preferred option's freeze of 2020 requirements but be far less than the Obama rules, Reuters reported on Thursday.


(Reporting by David Shepardson; Editing by Chris Reese and Stephen Coates)