Urgent Call from OEMs: We Need Unified Emissions Regulations by 2027!

As the year 2027 approaches, original equipment manufacturers (OEMs) in the trucking and engine sectors find themselves grappling with a web of complex and shifting emissions regulations spanning both Canada and the United States. The discrepancies and lack of clarity in these regulations pose significant challenges, creating a landscape marked by uncertainty and concern.

OEMs are keenly aware that the new EPA27 NOx rules will usher in stringent standards, demanding reductions from 0.2 grams per horsepower hour to an alarming 0.035 grams. This impending shift amplifies the urgency for regulatory alignment between the two countries, as over four million vehicles cross the U.S.-Canada border annually, emphasizing the need for a consistent framework.

With the clock ticking, voices within the industry, like those of leaders such as Sean Waters and Krista Toenjes, echo a shared call for clarity, underlying the critical nature of stable emissions regulations that can guide their compliance strategies in this evolving landscape. The stakes are high, and as we delve deeper into the intricate regulatory challenges facing OEMs, it becomes clear that achieving harmony in emissions regulations is not merely desirable; it is essential for the sustainability and competitiveness of the industry.

“The most important thing the OEMs have been doing over the last five to seven years is getting ready for the 2027 NOx standards.” – Sean Waters

This emphasizes the proactive steps manufacturers are taking in anticipation of significant regulatory changes.

Current Regulatory Landscape

The emissions regulations framework in Canada and the United States is characterized by a rapidly evolving landscape that significantly impacts Original Equipment Manufacturers (OEMs). Key regulations, such as the Environmental Protection Agency’s (EPA) 27 NOx rule and the Greenhouse Gas (GHG) Phase 3 rules, demonstrate a critical shift towards more stringent emission standards aimed at reducing harmful pollutants and mitigating climate change through emissions compliance.

United States Regulations

The EPA27 NOx rule, effective for the 2027 engine models, is a landmark regulation mandating a drastic reduction in nitrogen oxide (NOx) emissions, aiming for a reduction of over 75% compared to previous standards. This regulation necessitates advanced engineering solutions, integrating clean technology such as enhanced engine technologies and aftertreatment systems to comply while maintaining performance and fuel efficiency. This unprecedented tightening of standards not only reflects the government’s commitment to cleaner air but also places immense pressure on OEMs to meet these rigorous requirements. Source

Moreover, the recently finalized GHG Phase 3 standards, issued on March 29, 2024, impose stringent greenhouse gas emission caps for heavy-duty vehicles starting in 2027. This set of regulations is anticipated to yield a reduction of approximately 1.8 billion metric tons of GHG emissions over several decades, underscoring the urgency for OEMs to adapt their design and manufacturing processes accordingly. The focus on sustainable transportation models further ensures that OEMs incorporate these regulations into their development strategies. Source

Canada’s Approach

Canada aims to align its emission standards closely with those of the United States. Recent amendments to the Heavy-duty Vehicle and Engine Greenhouse Gas Emission Regulations represent a commitment to matching U.S. standards, thus facilitating a unified North American market. Canada is expected to introduce similar regulations limiting criteria air contaminants (CAC) beginning with the model year 2027, paralleling U.S. rules and reflecting the cooperative regulatory approach between the two countries. Source

Importance of Consistency

The need for consistent regulations across Canada and the U.S. cannot be overstated. Over 4 million vehicles cross the border annually, making a unified regulatory framework essential for OEMs to avoid compliance complexities and costs. Divergences in regulations not only hamper operational efficiencies but also jeopardize competitiveness in the increasingly global automotive market. Stakeholders emphasize that regulatory clarity and consistency are crucial for strategic planning, innovation in emission reduction technologies, and fostering an environment conducive to both compliance and sustainability.

OEM Concerns Over Regulatory Uncertainty

As the industry moves closer to the stringent emissions standards set to take effect in 2027, Original Equipment Manufacturers (OEMs) are increasingly voicing their concerns over regulatory uncertainty. The lack of clear directives regarding emissions regulations is causing anxiety among OEMs, who are tasked with ensuring compliance while also striving to remain competitive in the market.

Krista Toenjes, General Manager of North America On-Highway Business at Cummins, articulated the challenges faced by OEMs, stating, “Right now we’re in a waiting game when it comes to 2027. We have our strategy to hit the 2027 emissions standards… and right now it’s up in the air. I’m not really sure what is going to happen. We just want a decision one way or another. We need clarity on that.” This sentiment reflects a broader concern within the industry: the pressing need for a decisive regulatory framework that can guide manufacturers in their strategic planning.

Rick Mihelic, Director of Emerging Technologies with the North American Council for Freight Efficiency (NACFE), expressed his worries about the variability of emissions standards across borders. Mihelic noted, “It’s a significant potential challenge for the OEMs to have to produce vehicles that work in two nations.”

With over four million vehicles crossing the U.S.-Canada border each year, the need for unified emissions regulations is more critical than ever. OEMs are looking towards regulators for clarity and guidance. Without it, the path to meeting ambitious environmental goals remains fraught with obstacles. Paul Rosa, Senior Vice President of Procurement and Fleet Planning at Penske, has emphasized the critical need for clear regulatory guidelines in the trucking industry. He likened the current planning environment to “driving in a fog,” highlighting the challenges fleets face due to uncertain future emissions standards.

These insights underline the urgency for clarity in regulatory frameworks, which is necessary for OEMs to navigate compliance effectively and sustainably.

Call to Action for OEMs

In light of the urgent need for regulatory clarity and the impending changes in emissions standards, it is crucial for Original Equipment Manufacturers (OEMs) to take a proactive stance. OEMs are encouraged to advocate for clearer and more consistent regulations across Canada and the United States. This collective voice can help ensure that all stakeholders in the emissions landscape—regulators, manufacturers, and consumers—are aligned in their expectations.

By engaging with policymakers and regulatory bodies, OEMs can stress the importance of a unified approach to emissions regulations. Advocacy efforts should focus on creating a regulatory environment that not only supports compliance but also fosters innovation and sustainability within the industry. As the landscape evolves and more stringent regulations are introduced, consistency will be key to maintaining competitiveness and operational efficiencies across borders.

Now more than ever, OEMs must unite to influence regulatory frameworks that are clear, responsive, and conducive to the long-term goals of reducing emissions and supporting a sustainable future. Let us champion the cause for clearer regulations—together, we can pave the way for a more unified and effective emissions strategy in North America.

Vehicle Crossings and Emissions Regulations

The relationship between vehicle crossings between the United States and Canada and emissions regulations cannot be overlooked, especially as we approach the enforced standards of 2027. In 2024, approximately 13,345,500 personal vehicles crossed the border, marking an 8.9% increase from 2023. Despite a slight decline, around 3,837,400 trucks also traversed this boundary. This movement of vehicles highlights the scale of cross-border traffic and its potential impact on emissions.

The increased volume of vehicles crossing implies that stricter emissions regulations are crucial to manage the environmental implications. The transportation sector accounted for 28% of total U.S. greenhouse gas emissions in 2022, a figure that could rise with the projected 40% increase in passenger vehicle crossings and a staggering 120% surge in truck traffic expected by 2030. This is particularly concerning given that light-duty and heavy-duty vehicles contribute significantly to air pollutants.

Each passenger vehicle emits an estimated 4.6 metric tons of CO₂ annually. With millions of vehicles crossing the borders yearly, the potential emissions generated from this traffic necessitate comprehensive regulatory frameworks to mitigate environmental impacts effectively.

OEMs must grapple with these statistics, especially as they pertain to the need for cohesive regulatory approaches that transcend the border. The inconsistencies currently present in emissions regulations can complicate compliance, increase costs for manufacturers, and stifle innovation in cleaner technologies.

The staggering number of crossings underscores the urgency for clarity and consistency in emissions regulations across both nations. Without a unified framework, the environmental objectives could be endangered, and the automotive industry’s ability to innovate sustainably might be compromised. As such, OEMs are increasingly calling for regulatory alignment to facilitate a sustainable future while navigating this complex landscape of emissions standards.

In conclusion, the evolving emissions regulations present significant challenges for Original Equipment Manufacturers (OEMs), warranting an urgent call for clarity and consistency between Canada and the United States. The uncertainty surrounding regulatory frameworks not only hinders strategic planning and operational efficiency but also stifles innovation within the industry.

By advocating collectively for unified regulations, OEMs can promote a framework that fosters technological advancements and sustainability. Regulatory clarity can streamline compliance efforts, allowing manufacturers to focus on developing cleaner technologies and efficient processes that benefit both the economy and the environment.

The implications extend beyond operational concerns; a cohesive regulatory approach is crucial for enhancing competitiveness in the global market while meeting environmental goals. As stakeholders in this landscape, OEMs must unite in their demand for clearer regulations to pave the way for a sustainable future, not only ensuring their compliance but actively contributing to the broader aspirations of reduced emissions and environmental stewardship.