President Donald Trump delivers remarks at American Center for Mobility in Ypsilanti, Michigan with General Motors CEO Mary Barra and other auto industry executives on March 15, 2017.
Nicolas Kamm | AFP | Getty Images
General Motors is withdrawing from litigation led by the Trump administration against California over the state’s right to set its own fuel economy and emissions regulations, distancing itself from President Donald Trump.
In a letter Monday to environmental leaders, GM CEO Mary Barra said the company’s decision to withdraw from the litigation is effective immediately. It follows President-elect Joe Biden’s Nov. 3 election, his support for electric vehicles as well as his call for unity in the country, she said.
“We believe the ambitious electrification goals of the President-elect, California, and General Motors are aligned to address climate change by drastically reducing automobile emissions,” Barra wrote.
By withdrawing, GM is showing support for the incoming administration while distancing itself from Trump, who has publicly praised and condemned automakers during his tenure as commander in chief. GM has plans for a robust portfolio of electric vehicles in the coming years.
Shares of the automaker during trading Monday afternoon were up as much as 4.9% to a new 52-week high of $45.16 per share.
The White House did not immediately respond for comment. U.S. Environmental Protection Agency spokesman James Hewitt said that “it’s always interesting to see the changing positions of U.S. corporations.”
Biden is widely expected to drop the litigation against California and allow the state to set its own standards. California was allowed to do so under a 2013 waiver it received under the Clean Air Act. Other states were allowed to adopt those standards as well.
The Detroit automaker along with Fiat Chrysler, Toyota Motor and other smaller automakers initially supported Trump’s efforts in late-2019. Trump at the time was fighting to rollback the Obama administration’s national emissions standards and strip California and other states of the right to set their own vehicle emissions regulations.
Four other major automakers — Ford Motor, BMW, Honda Motor and Volkswagen — reached a deal with California in July to toughen the gas mileage and emissions standards, drawing ire from Trump.
Barra invited other automakers involved in the lawsuit to “join us” and withdraw from the litigation. Fiat Chrysler and Toyota did not immediately have a response to GM’s call to withdraw from the lawsuit.
GM’s decision comes days after the automaker announced plans to spend $27 billion on all-electric and autonomous vehicles through 2025, an increase of $7 billion, or 35%, from initial plans announced in March.