There is a real-life drama unfolding for six major automakers—Ford, Honda, Volkswagen, BMW, Aston Martin, and Volvo—who are locked into California’s strict emissions rules through 2026, thanks to contracts they signed in 2019. This is bad foresight. This isn’t just a story about regulations; it’s about power, promises, and the future of the cars we drive.
California’s Muscle: The State That Calls the Shots
Let’s set the stage. California isn’t just the land of beaches and Hollywood—it’s a regulatory powerhouse in the auto world. Thanks to Section 209 of the Clean Air Act, the Golden State has a unique privilege: it can set tougher vehicle emissions standards than the federal government, as long as the Environmental Protection Agency (EPA) gives it a thumbs-up.
Why? Decades ago, California started battling smog in cities like Los Angeles, and it’s been a trailblazer in clean air policy ever since. About a third of the U.S. auto market is impacted, including New York, Massachusetts, and Oregon that follow California’s lead, making its rules integral to the future of the automotive industry.
Back in 2019, things got messy. The Trump administration pulled California’s EPA waiver, aiming to enforce one federal standard for fuel economy and emissions under the Corporate Average Fuel Economy (CAFE) program. This move was like throwing a wrench into the auto industry’s engine.
California pushed back hard, and automakers were caught in the crossfire, facing a patchwork of rules. Enter the California Framework Agreements—a deal that would tie six automakers to California’s standards, no matter what happened in Washington.
The Deal That Locked Them In
In July 2019, Ford, Honda, Volkswagen, and BMW stepped up to the plate, signing voluntary but ironclad agreements with the California Air Resources Board (CARB). Aston Martin and Volvo later jumped on board. These Framework Agreements committed the automakers to boosting fuel efficiency by roughly 3.7% annually and slashing greenhouse gas emissions for vehicles sold in California and its allied states, all the way through the 2026 model year.
Why sign on to such a deal? For these companies, it was a calculated move. The 2019 revocation of California’s waiver created a regulatory nightmare—automakers faced the prospect of designing cars for two different sets of rules. By aligning with California, these six sidestepped potential lawsuits, gained a clear roadmap for compliance, and scored some eco-friendly street cred.
It was a bet that California’s influence would outlast federal flip-flops. But here’s the thing: these contracts are binding, no matter what the feds do. Even when the Biden administration restored California’s waiver in 2022, these automakers were still on the hook for the 2019 terms.
Why Didn’t All Brands Sign Up
So, why are only six automakers in this sinking boat? Not every company was ready to tie itself to California’s control. Big players like General Motors, Toyota, and Stellantis leaned toward the Trump administration’s push for a single federal standard, hoping to simplify their lives.
Others, like the six brands, saw California’s clout—its massive market and growing coalition of states—and decided to play ball. This split has created a fascinating divide in the industry as well as some potential nightmares
Imagine the auto market as a chessboard. The six signatories are playing a long game, betting on California’s standards becoming the industry benchmark. Meanwhile, their rivals have more flexibility, aligning with federal rules that might be looser or stricter depending on the political winds.
This raises a big question: are Ford, Honda, and the others at a disadvantage, stuck with more costly standards? Or are they ahead of the curve, ready for a future where emissions rules only get tougher?
The Real-World Impact: Costs, Cars, and Choices
So, what does this mean for the cars you drive? Meeting California’s standards is no small feat. It demands serious cash for research and development for hybrid systems, electric vehicles (EVs), and cutting-edge engines that sip fuel.
For Ford, Honda, Volkswagen, BMW, Aston Martin, and Volvo, these costs are locked in through 2026. That could mean pricier vehicles for buyers in California and its partner states, as automakers pass on the expense of compliance to customers.
For you, the consumer, it’s a mixed bag. Cars meeting California’s standards might save you money at the pump with better fuel economy or lower emissions. But upfront costs could sting, especially for budget-conscious buyers.
If you live in a state following California’s rules, your car options might differ from those in, say, Texas or Ohio, where federal standards apply. It’s a patchwork market, and these six automakers are navigating it under stricter rules than their rivals.
The Big Fight: State vs. Federal Power is Next
This isn’t just about cars—it’s about who gets to call the shots for the auto industry. California’s ability to set its own standards has sparked heated debates. Supporters say it’s a vital check on federal inaction, pushing automakers to innovate and clean up the air. Critics argue it’s a bureaucratic headache, forcing companies to juggle conflicting rules and driving up costs. The Framework Agreements tilt the scales toward California, proving its influence even when federal policy wavers.
When the Biden administration restored California’s waiver in 2022, it reaffirmed the state’s clout. But the agreements mean these six automakers are locked in, no matter what happens next. If federal standards get tougher, they might face overlapping rules. If they loosen, their competitors could gain an edge. The outcome will shape the industry for years to come.
The Road Ahead: What’s Next?
As 2026 looms, the auto industry is at a crossroads. California’s pushing hard for zero-emission vehicles, with a plan to phase out new gas-powered car sales by 2035, even thought the federal mandate is no longer valid.
The six automakers in the Framework Agreements are already gearing up, pouring billions into EVs and hybrids even with lower sales and losses. Ford’s betting on electric vehicles with their new manufacturing processes, Honda’s refining its hybrid tech and continuing its partnership with GM, and BMW, Volvo, Volkswagen and Aston Martin are trying to figure out how to balance electric cars with what car people want. The 6 brands are caught in a tough position.
If you want an electric vehicle, I suggest you move quickly and buy one before the end of September 2025, where the tax credit for new and used EVs disappears.
President Trump has dismantled the Biden administration’s electric vehicle agenda, scrapping federal EV mandates and slamming the brakes on California’s aggressive zero-emission rules.
This is going to hurt the six brands even further. President Trump froze billions in unspent EV charging station funds, and ordered the EPA to roll back emissions standards that would have forced automakers to drastically ramp up EV production. He also moved to block California’s Clean Air Act waivers—special permissions that let the state impose its own bans on new gas-powered vehicles by 2035, rules that more than a dozen other states had adopted.
In June, President Trump signed three Congressional Review Act resolutions that killed California’s mandates for passenger cars, heavy-duty trucks, and low-NOx engines, effectively dismantling the largest state-level push for EV adoption in the country. The federal mandate is gone.
What’s next, to remove California’s power over the entire country, as this is against the constitution. This will likely head to the Supreme Court, and the six who side with California may be stuck holding the bag of extra costs that can not be overcome.
We'll be watching this story careful. The auto industry’s next chapter is one you won’t want to miss.
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Lauren Fix is an automotive expert and journalist covering industry trends, policy changes, and their impact on drivers nationwide. Follow her on X @LaurenFix for the latest car news and insights.
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