California inks deal with top automaker to support clean-car rules against legal threats

California Gov. Gavin Newsom on Tuesday announced that auto giant Stellantis has agreed to support the state’s vehicle emissions standards, a move intended to insulate the state's strictest-in-the-nation electric vehicle sales rules from a potential Trump administration.

Stellantis — the fourth-largest automaker in the world with brands like Chrysler, Jeep and Dodge — will sign onto the same framework negotiated by five major automakers in 2019 with the California Air Resources Board during former President Donald Trump's tenure.

The agreement comes a day before U.S. EPA is due to finalize its own tailpipe emissions rules that are expected to result in slower electric vehicle sales. An earlier federal proposal would have required 67 percent new vehicle sales in 2023 to be electric vehicles.

"We want to continue to lead the world," Newsom said in a press conference in Sacramento. "We're not going to take a backseat in that effort, and today's announcement only further accelerates that."

The deal commits Stellantis to complying with California requirements to sell increasing numbers of electric vehicles through 2030 "even if CARB is unable to enforce its standards as a result of judicial or federal action." Twelve other states are signed onto California's rules as part of the state's unique arrangement under the Clean Air Act that allows it to set stricter-than-federal vehicle standards with EPA's permission.

A group of Republican-governed states led by Ohio are challenging California’s clean cars waiver, arguing that California’s unique authority to set air quality standards violates the Constitution, under a legal theory that all states need to be treated equally. The case was heard in September in the District of Columbia Circuit Court and is expected to go to the Supreme Court.

The companies that joined the original deal — Ford, Volkswagen, Honda, BMW and Volvo — did so as the Trump administration moved to freeze a waiver that gives California the authority to set stronger air quality standards than federal rules. All five automakers pledged to continue supporting California’s regulations even after the Advanced Clean Cars rule was rolled back in 2020.

The agreement with Stellantis similarly includes a commitment from the company to support California's tailpipe emissions standards covering model years 2026-35, which are waiting for an EPA waiver. It also requires Stellantis to offer discounted electric vehicles in disadvantaged communities and contribute $10 million for installing public electric vehicle chargers.

Stellantis CEO Carlos Tavares called the deal a “win-win” that will avoid 10 to 12 million metric tons of greenhouse gas emissions through 2030. The company had said in December that it wanted to join California's alliance with automakers and that it gave the signatories unfair advantages in California's sales market.

“We remain as determined as ever to offer sustainable options across our brand portfolio and being a leader in the global decarbonization efforts,” Tavares said in a statement.