💎 Fed’s first rate cut since 2020 set to trigger market. Find undervalued gems with Fair ValueSee Undervalued Stocks

U.S. government shutdown threatens rollout of new car models: automakers

Published 01/24/2019, 03:51 PM
Updated 01/24/2019, 03:55 PM
© Reuters. FILE PHOTO - Newly assembled Ford F150 pick-up trucks are driven off the assembly line during the 100-year celebration of the Ford River Rouge Complex in Dearborn
GM
-
F
-
STLAM
-

By Valerie Volcovici

WASHINGTON (Reuters) - The partial U.S. government shutdown is threatening to delay the roll-out of new vehicle models in the United States by stalling required certifications from the Environmental Protection Agency, automakers said.

The shutdown, at 34 days the longest in history, has left over 800,000 federal agency workers without pay and had an impact on everything from access to national parks to airline security screening to the release of economic data.

Some 95 percent of EPA staff has been furloughed, including those at the lab in Ann Arbor, Michigan, responsible for verifying emissions data for new automotive models to ensure they comply with clean air laws.

GM (N:GM) has not yet had any vehicle launch delays but "like other automakers, we are currently awaiting decisions in the certification process for a few model year 2019 and 2020 vehicles," spokeswoman Jeannine Ginivan said.

Fiat Chrysler (N:FCAU) Chief Executive Officer Mike Manley said at the Detroit Auto Show last week that the shutdown had delayed final certification of FCA's new RAM 3500 heavy-duty pickup truck, one of its most profitable segments.

Ford Motor Co (N:F) officials said some vehicles could be delayed if the government shutdown goes another 30 days.

"As the shutdown continues, these certification delays will affect U.S. vehicle production. Consumers will also not have access to the latest technologies and sales could decline as a result," industry trade group Global Automakers told Reuters.

The EPA declined to comment.

Former acting administrator of the EPA, Stanley Meiburg, noted the agency's certification process was central to discovering Volkswagen's past efforts to cheat on emissions.

Automakers tend to seek certifications well in advance of releasing them to the market - meaning a delayed certification does not always impact the roll-out schedule. But the issue could become more serious if the shutdown lingers for much longer, Meiburg said.

"Any disruptions to this part of the process will disrupt the entire supply chain," he said.

Republican President Donald Trump has refused to sign any legislation to fund an array of government agencies unless it includes $5.7 billion for his proposed wall on the U.S. border with Mexico.

© Reuters. FILE PHOTO - Newly assembled Ford F150 pick-up trucks are driven off the assembly line during the 100-year celebration of the Ford River Rouge Complex in Dearborn

Democrats argue that a wall is costly, and there are better ways to shore up national security and curb illegal immigration.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.