US clean truck emissions lawsuit fuels investment uncertainty for automotive logistics
A legal challenge to US heavy-duty vehicle emissions rules is intensifying regulatory uncertainty for automotive logistics and supply chains, as the Engine Manufacturers Association (EMA) moves to intervene in the case over EPA Phase 3 standards. The dispute, rooted in the Endangerment Finding and shifting federal climate policy, risks delaying investment decisions across truck manufacturing, freight operations and North American decarbonisation strategies.
Fresh uncertainty for truck manufacturers, logistics providers and clean transport investment could come from a legal challenge to emissions standards in the US, with the Engine Manufacturers Association (EMA) seeking to intervene in the lawsuit.
What the lawsuit means for Phase 3 truck emission standards
The lawsuit centres on Environmental Protection Agency (EPA) authority, derived from the Endangerment Finding to protect the environment, under which the Phase 3 emissions standards were developed. Phase 3, which was scheduled to go into effect from 2027 onwards, would implement stricter standards for nitrogen oxides, particulate matter and greenhouse gas emissions from new trucks and engines. These Phase 3 standards would mandate a large and increasing proportion of each truck manufacturer’s sales to be zero-emission vehicles, requiring major new fleet and technology investments and adoption of electric, hydrogen or hybrid trucks.
The policy was first introduced in 2024 under the Biden administration, but the Trump administration announced the EPA would rescind the Endangerment Finding. A coalition of US states are questioning the legality of Trump’s rollback through legal action. Now, the EMA, whose member companies include Daimler Truck, Paccar, and Volvo Group North America, is seeking to intervene in support of efforts to block or overturn the Phase 3 standards.
Why the EMA is getting involved in the Phase 3 emissions standards lawsuit
The EMA is opposing the mandate as it says it “fails to account for the fact that manufacturers cannot meet the standard unless trucking fleets, EMA member company’s customers, choose to purchase those vehicles”. It argues that it would require a fundamental and economically significant market shift that would restrict trucking fleets’ ability to select vehicles that best meet operational needs.
In a statement, Jacqueline Gelb, president of the EMA said: “EMA remains committed to the transition of cleaner-emissions technologies and supports innovation that reduces the environmental impact for the US trucking industry. At the same time, EMA is exercising the legal right to intervene when unrealistic timelines and technology mandates risk undermining long-term investment and regulatory certainty for manufacturers and our customers.”
Gelb added that member companies have invested significant money already in meeting Phase 1 and 2 of the rules, which it says was successful because it aligned with fleet demand for technologies that met performance demand requirements.
“Despite the fact that manufacturers have invested tens of billions of dollars to develop and bring to market zero-emission heavy-duty vehicles, the GHG Phase 3 sales mandate should not be the means to shift the market to zero emission technologies,” Gelb added.
Automotive Logistics has contacted the EMA for further comment.
How US truck makers are responding to the emissions standards uncertainty
Sierra Club, an environmental nonprofit association, is more skeptical about why the EMA is getting involved. Speaking to Automotive Logistics, Katherine Garcia, director of the clean transportation for all campaign at Sierra Club, says she believes it’s a strategic move, as EMA members are regulated entities, giving them potential standing in the court case.
While truck makers were aware of the 2027 implementation date for the Phase 3 emissions standards and would’ve had to have prepared for the shift years in advance, Garcia says she believes this came to a halt when Trump was elected for his second term.
“This is a little bit speculative, but I would suspect they stopped working on plans to upgrade their plants and increase the number of electric trucks the second Trump was elected,” Garcia says. “My suspicion is that the truck makers put a pause on really trying to adhere and comply because they knew that Trump was going to have such a deregulatory agenda that anything that had to do with getting to low pollution was going to get eviscerated.”
Trump has been consistent in promising deregulation of environmental rules, in line with his focus on fossil fuels in “unleashing American energy”. In the first 100 days of his second term, Trump and his administration took more than 140 actions to roll back environmental rules, and set about rewriting standards that limit emissions from vehicles. The White House itself has praised deregulatory actions taken by Trump. In February this year, in an official statement, it called the revocation of the Endangerment Finding the “single largest deregulatory action in American history”. At the time, spokespeople from Stellantis and Ford welcomed the decision.
As for Garcia’s speculation on electric trucks, deployments of etrucks are continuing to increase in the US, but the rate at which they are being deployed has dropped significantly over the past year, due to greater hesitancy than seen in previous years. Industry observers cite factors including higher upfront costs and regulatory uncertainty.
But looking at some EMA members’ financial reports, including Volvo Group, Daimler Truck and Paccar, it’s clear the truck makers are still investing in the adoption despite slower-than-expected demand.
Expected timeline for the court case on emissions standards for US trucks
The uncertainty around the emissions standards for trucks in the US is expected to last at least a few years, depending on whether the EMA intervention is granted smoothly, court congestion, and potential political or public pressure.
Best-case scenario (fast track)
In the quickest scenario, it could be between 12 and 18 months for a first binding decision, and up to two years if there’s an appeal.
- Intervention decision: 1–3 months. Court decides whether EMA or other groups can join the lawsuit.
- Motions/briefing: 2–4 months. Plaintiffs and defendants submit arguments, and court may issue early rulings (e.g., motion to dismiss).
- Decision at District Court: 6–12 months from now. Court could rule entirely on the merits without needing full trial or extensive discovery if the law is clear.
- Appeal (optional/if challenged): 6–12 months. If losing party appeals to the relevant US Court of Appeals, a decision could come within a year.
Worst-case scenario (slow track/complex litigation)
A slower legal decision could mean a wait of between three and five years for a final resolution.
- Intervention decision: 3–6 months. Court may allow EMA to intervene, adding extra filings and hearings.
- Extended discovery and motions: 6–12 months. Detailed evidence on EPA procedures, science, and legal precedent may be required.
- District Court trial/decision: 12–24 months from now. Complex environmental cases often involve expert testimony and extensive legal analysis.
- Appeals to Circuit Court: 12–18 months. Could involve oral arguments, multiple rounds of briefing, and potential remands.
- Further review (rarely, Supreme Court): 1–3 years additional if petition granted. Highly unlikely but possible for high-profile EPA policy cases.
The overall impact on automotive logistics and supply chains in North America
The litigation creates uncertainty for planning and investment timelines, with downstream impacts on automotive logistics and supply chains, particularly around manufacturing location decisions and electrification rollout strategies.
Whatever the final decision, the industry faces continued variability as the case shows how the EPA regulatory direction can shift with elections and court rulings.
This could lead to OEM and supplier investment hesitation. Capital decisions rely heavily on long-lead times, with electric platform investment cycles taking five to ten years. It also could encourage dual-track production of ICE and electric trucks for longer than planned, and could slow down consolidation of supply chains as truck makers could hedge their bets on electrification.
Running both legacy ICE supply chains and electric truck supply chains means increasing inventory and sourcing costs, and a reduction in freight optimisation efficiency.
And it makes things more complicated for cross-border logistics, with higher border compliance friction leading to longer lead times and regulatory fragmentation increasing logistics complexity.
We may see truck makers take on a ‘wait and see’ approach, similar to what OEMs have done in past crises. This could mean more delays in e-truck ramp-ups, slower investment in charging infrastructure for logistics, and a more cautious expansion of battery supply chains. Higher working capital could be tied up in inventory, with less lean logistics models and reduced just-in-time efficiency across OEM networks. If this is the case, and the courts decide to enforce the Phase 3 emissions, the industry will be on a back foot without years of investment in infrastructure and technology, and capital returns will become harder to model.
It also could mean that while awaiting a legal decision, logistics providers could price in regulatory risk premiums, resulting in higher costs and slower overall decarbonisation.
The Endangerment Finding uncertainty doesn’t stop automotive decarbonisation, but it does reduce regulatory predictability, which forces North American automotive supply chains into longer, more complex and more expensive transition logistics.
Daimler Truck and Volvo Group North America have been contacted for comment. Paccar declined to comment.
