Truck OEMs sue CARB; FTC drops anti-trust investigation against them

Key Takeaways

• DTNA, International, Paccar, and Volvo Group are suing California to get out of the Clean Truck Partnership, arguing they are “caught in the crossfire” between CARB mandates and federal orders to ignore them.

• The Clean Truck Partnership was signed as a compromise between OEMs and CARB to align emissions standards and EV goals, and give OEMs lead time to meet standards. 

• FTC dropped an antitrust probe into the four OEMs immediately after they filed suit.

In the wake of President Donald Trump using the Congressional Review Act (CRA) to neutralize California’s ability to supersede EPA regulations through Clean Air Act preemptive waivers, the top North American truck makers—Daimler Truck North America, International, Paccar, and Volvo Group North America—filed a lawsuit against the state on Aug. 11 (Daimler Truck North America LLC et al v. CA Air Resources Board et al).

At stake is whether the manufacturers must comply with California’s Clean Trucking Partnership (CTP) commitments or follow federal directives to ignore them.

On the federal side, the U.S. Department of Justice has ordered the OEMs to cease and desist in complying with CARB. But California, challenging the legality of the CRA resolutions via California v. EPA, insists the CTP must be honored.

FTC Closes Antitrust Investigation

Almost immediately after the lawsuit was filed, the Federal Trade Commission closed its antitrust investigation into the same four OEMs for joining the CTP. Because they control 99% of U.S. heavy-duty truck sales, collaborating with CARB “raised several antitrust concerns,” the FTC said.

Those concerns included:

• Forcing OEMs to produce ZEV engines despite the regulations being invalidated
• Lacking provisions to prevent competitive abuse of restrictions
• Locking in terms with limited political oversight
• Allowing elected officials to modify terms

In letters to the FTC, DTNA, International, Paccar, and Volvo Group all stated the CTP is “unenforceable” and pledged never to enforce its terms against a competitor. They also agreed not to enter into similar agreements with regulators.

“CARB’s regulatory overreach posed a major threat to American trucking and, in our view, presented serious antitrust concerns,” said Taylor C. Hoogendoorn, Deputy Director of the Bureau of Competition. “The Commission’s swift action will put the Clean Truck Partnership squarely in the rearview mirror and prevent repeats of CARB’s troubling regulatory gambit.”

Rise and Fall of the Clean Truck Partnership

In 2023, with California pushing aggressive emissions policies and billions in federal ZEV funding earmarked from the Inflation Reduction Act and the Infrastructure Investment and Jobs Act, the OEMs and the Truck and Engine Manufacturers Association signed the CTP with CARB. This included the four plaintiffs— DTNA, International, Paccar, and Volvo—as well as Cummins, Ford, General Motors, Hino, Isuzu, and Stellantis.

The deal gave manufacturers concessions—CARB would align its 2027 NOx standards with federal levels, support charging infrastructure, and provide four years’ notice for new rules. In return, OEMs agreed to follow CARB’s emissions and EV sales goals and, crucially, to not challenge certain CARB regulations or its EPA-granted authority.

This diesel détente caught the ire of trucking’s trade groups.

At the time, Chris Spear, president of the American Trucking Association, stated: “It is clear that America has lost its way when the government bullies the private sector to succumb to unachievable timelines, targets, and technologies."

Then in 2024, the four OEMs acting as plaintiffs against CARB were named as defendants in a Nov. 2024 anti-trust lawsuit for joining the Clean Truck Partnership. The suit, filed by Nebraska, the ethanol trade association Renewable Fuels Nebraska and liquid fuel trade association Energy Marketers of America, called out the truck makers, arguing, “Their illegal horizontal conspiracy, enshrined in the CTP agreement, will injure the market for Class 8 ICE vehicles by reducing output, eliminating choice, and raising prices for these vehicles.”

That suit faded after the FTC’s decision.

What’s Next

California v. EPA was instantly brought to the U.S. District Court for the Northern District of California after Trump signed the three CRA resolutions. It could take months or more to move forward.

John L. Watson, an environmental lawyer for Spencer Fane, believes this case “will undoubtedly end up in the U.S. Supreme Court.”

If California does come out victorious in that suit, it would render the one brought by the OEMs moot. They would have to abide by CARB’s standards.

Regardless, Trump’s EPA has quickly worked to dismantle the vehicle regulations the president views as contrary to U.S. interests. Since signing the CRA resolutions, the EPA has changed gas can rules and proposed retracting the 2009 endangerment finding that provides the foundation for many greenhouse gas emissions standards. And while CARB is working to make aftertreatment systems more complicated, Zeldin announced he wants engine makers to develop software so that diesel exhaust fluid issues do not immediately derate diesel engines.

The bottom line is that the party in power favors an anti-regulatory stance, and internal combustion is no longer walking the Green Mile, prepping for execution by electrification. And those who want to stick with diesel, or scale EVs, or opt for renewable natural gas or renewable diesel, or even continue to “roll coal” with older engines, have the freedom to do so. The most efficient and cost-effective solution, or likely mix of solutions, will become apparent in due time. And for now, that’s a victory trucking will gladly take.