Michigan sues oil companies, saying they colluded to restrain EV competition

By David Shepardson and Mike Scarcella

WASHINGTON, Jan 23 (Reuters) – Michigan Attorney General Dana Nessel on Friday filed an antitrust lawsuit against four major oil companies, asserting they have colluded for decades to forestall competition from renewable energy, including electric vehicles.

The suit filed in U.S. District Court in western Michigan names BP, Chevron, Exxon, Shell and the American Petroleum Institute. The suit said the companies acted “as a cartel, agreeing to reduce the production and distribution of electricity from renewable sources and to restrain the emergence of electric vehicles and renewable primary energy technologies in the United States.”

A lawyer for Chevron in a statement called Michigan’s lawsuit “baseless as demonstrated by multiple related court dismissals” in other venues, including New York, Pennsylvania and Delaware. “This lawsuit also ignores the fact that Michigan is highly dependent on oil and gas to support the state’s automakers and workers,” attorney Theodore Boutrous Jr. said. 

Shell declined to comment. Representatives from BP, Exxon and the American Petroleum Institute did not immediately respond to requests for comment.

The suit said the companies “abandoned renewable energy projects, used patent litigation to hinder rivals, suppressed information concerning the hidden costs of fossil fuels and viability of alternatives… and used trade associations to coordinate market-wide efforts to divert capital expenditures away from renewable energy—all to further one of the most successful antitrust conspiracies in United States history.”

The suit noted that in the 1970s, Exxon developed the first hybrid gas-electric vehicle technologies and in 1978 Exxon publicly showed an electric motor integrated into a hybrid gas-electric propulsion system, installed in a Chrysler Cordoba and in 1979, Exxon partnered with Toyota to develop a hybrid gas-electric vehicle using a Toyota Cressida chassis.

“But Exxon never marketed that innovative hybrid engine technology and consistently has deferred meaningful investment in its lithium-ion and graphite-based battery technologies for EVs,” the lawsuit said, adding Exxon’s internal research in 1979 “predicted that renewable energy would increasingly become a competitive threat to fossil fuels.”

The suit also said Chevron took steps to delay a critical EV and battery technology known as nickel-metal hydride rechargeable batteries by acquiring patentsto restrict their use in automobiles.

The Trump administration has taken a series of actions to make it easier for automakers to avoid building EVs and make it more expensive for consumers to buy EVs after the Biden administration had adopted rules that would have required automakers to build a rising number of EVs.

(Reporting by David Shepardson and Mike Scarcella in Washington; Editing by Aurora Ellis)