Stellantis seeks to void California emissions deal with rival automakers

By David Shepardson

(Reuters) -Chrysler-parent Stellantis (NYSE:) said on Wednesday it is seeking to void a 2019 California emissions deal with rival automakers and it may face new compliance penalties from state regulators.

The automaker said it was petitioning to overturn the California Air Resources Board (CARB) agreement to “relieve Stellantis of the competitive disadvantages arising from our continuing exclusion and to preserve our ability to best serve our customers by fairly allocating our products to all states.”

Ford (NYSE:), Honda (NYSE:), Volkswagen (ETR:) and BMW (ETR:) struck a voluntary agreement with California on reducing vehicle emissions and Volvo (OTC:) Cars, owned by China’s Geely, joined soon afterward. Stellantis has since sought to join the voluntary agreement but been rebuffed.

Stellantis said in its filing with California that CARB intends to pursue retroactive enforcement of greenhouse gas emissions standards for 2021 and 2022 model years against automakers including Stellantis but “is not retroactively enforcing these same regulations against” automakers in the voluntarily agreement.

Stellantis said the agreement allows participating automakers to comply based on national sales, while it and other firms not taking part are measured by sales in the 14 states following the California rules, which hinders it from selling electric models in the other states.

CARB did not immediately comment

Stellantis said Wednesday at times it has been limiting shipments of gasoline-powered vehicles to dealers in states that have adopted California’s emissions rules and in some cases gas-powered vehicles were only shipped to those states for sold orders, once a customer ordered such vehicle.

Stellantis has also at times limited sales of plug-in EVs to states adopting California rules and only shipped sold order vehicles to other states.

In May, CARB asked the Environmental Protection Agency for approval for it rules adopted in August 2022 that would allow the state to ban the sale of gasoline-only powered vehicles by 2035 and require at least 80% electric-only models by then. The EPA has not yet opened the request for public comment.

In June, Reuters reported Stellantis paid a record $235.5 million for the 2018 and 2019 model years for not meeting U.S. fuel economy requirements.