Automakers and the United Auto Workers union had lobbied DOE to soften its original petroleum equivalency factor rule. They argued that more aggressive targets would have required them to sell more EVs to meet stricter federal fuel economy standards amid uncertain demand, making it impossible to comply. Environmental groups, including the Natural Resources Defense Council and Sierra Club, asked the Biden administration for stricter MPGe standards in 2021, which had not been updated since 2000. “The automakers’ free ride is over,” said Pete Huffman, senior attorney at NRDC, in a statement. “This important update from the Department of Energy will curtail automakers’ use of phantom credits they used to keep selling gas guzzlers. They now need to hit the accelerator on more fuel-efficient vehicles, saving consumers money at the pump.”     The Department of Transportation uses DOE’s petroleum equivalency factor to calculate MPGe and CAFE, which averages the fuel economy of all vehicles sold by a manufacturer. The old formula equated a battery-electric vehicle with a gas-powered car that gets 300 mpg. Under the new rule, however, an EV’s petroleum equivalency factor equals a gas vehicle that gets 106 mpg. The original proposal would have reduced it further to 84 mpg. “It looks like the administration changed course and adjustments to [the petroleum equivalency factor] will instead phase in over a number of years. That’s positive,’ said the Alliance for Automotive Innovation, which represents over 40 automakers, in a blog post Tuesday. The Detroit Three automakers and the UAW had been especially concerned about the rule because General Motors, Ford Motor Co. and Stellantis sell more light-duty trucks than other vehicle manufacturers, potentially exposing them to higher noncompliance penalties for CAFE violations. GM, Ford and Stellantis could have paid up to $10.5 billion in penalties for violating federal fuel economy standards, which would have comprised 76% of all such fines, according to the American Automotive Policy Council, an industry group representing the Detroit Three. The Environmental Protection Agency is set to finalize stricter emissions standards on Wednesday.

GKN Automotive’s former parent company, Melrose Industries, formed a new public company dubbed Dowlais. Melrose completed its demerger in April 2023, spinning off GKN Automotive, GKN Powder Metallurgy and GKN Hydrogen under Dowlais, while GKN Aerospace remains under Melrose Industries. Dowlais is independent from Melrose.     “We have a clear strategy to create value for our stakeholders by: delivering industry leading financial performance; facilitating the world’s transition to electric vehicles through a portfolio of cutting-edge products; and accelerating growth through a disciplined M&A strategy,” Dowlais CEO Liam Butterworth said in an April 2023 press release. The Timberlake facility is the second North Carolina site GKN Automotive closed in the past year. The auto parts maker closed its facility in Sanford in March of last year, according to a WARN Act post.

For legacy automakers, collaborating with tech companies like Mobileye can speed up the development and rollout of software-powered technology, including more advanced automated driving systems. Just one in four automakers are fully prepared for software-defined vehicles, according to an AlixPartners survey in January. The same report found that Tier 1 suppliers must adapt to automakers’ needs as the industry pivots to building more software-defined vehicles. The Volkswagen Group has collaborated with Mobileye, owned by chipmaker Intel Corp., on autonomous driving technology since 2018. The technology supplier specializes in computer vision processing for highly automated driving functions and vehicle advanced driver assist systems, such as automatic emergency braking and lane centering control.     As the companies develop more advanced driving systems, Mobileye will provide the automaker with production-ready technologies, including Level-2 automated driving capabilities. In 2026, the Volkswagen Group plans to add a Level-4 automated driving system to a version of the Volkswagen ID. Buzz electric van intended for commercial mobility and transportation services. “Our goal is to offer our customers throughout the world outstanding products with cutting-edge technology,” said Oliver Blume, CEO of the Volkswagen Group and Porsche AG, in a press release. “New automated driving functions will significantly boost convenience and safety.” In addition to working with Mobileye, the Volkswagen Group plans to collaborate with its other partners, including Bosch and Qualcomm, to further develop and refine software-based vehicles.

Stellantis plans to cut about 400 jobs among its nonunion engineering and software staff in the United States. The company provided a statement Friday that suggested a challenging industry picture as the reason. It said the cuts, which are separate from other reductions affecting union-represented workers announced in recent months, would be effective March 31. Stellantis owns the Jeep, Ram, Chrysler, Dodge and Fiat brands.     “As the auto industry continues to face unprecedented uncertainties and heightened competitive pressures around the world, Stellantis continues to make the appropriate structural decisions across the enterprise to improve efficiency and optimize our cost structure. After rigorous organizational reviews, Stellantis confirms that we will reduce our engineering/technology and software organizations by about 2% in the U.S.,” according to the statement provided by spokeswoman Jodi Tinson.