Thursday, May 22, 2025

California Edition: Tapping the brakes

The measure is headed to Trump's desk
View in browser
Bloomberg

Welcome to Bloomberg's California Edition—covering all the events shaping one of the world's biggest economies and its global influence. Join us each week as we put a unique lens on the Golden State. Sign up here if you're not already on the list.

The Senate's decision to block California's gas vehicle ban is about more than cars. It picks away at the state's power to set its own bold environmental standards, which often trickle down to other parts of the country.

The Clean Air Act of 1970 gave California the keys to go above and beyond federal pollution restrictions as the state battled health-threatening smog. Ever since, California has led the way with strict environmental rules that other states adopted.

The gas car mandate would have transitioned California to electric vehicles by 2035. New York and Washington, among other states, had already agreed to set up similar legislation. But if Donald Trump approves the measure to block it, states will be forced to follow the White House's looser emissions standards.

Gavin Newsom said California will sue the president if he signs the measure. In a press conference Thursday, Newsom defended the state's clean-air policies, arguing they deserve credit for Tesla's success and the rise of electric cars in general. The governor, who's widely rumored to be considering a presidential run in 2028, railed against Elon Musk and accused Trump of stifling technological innovation.

"This is about our economy," Newsom said. "It's about our health. It is, Donald Trump, about our national security. And it's about our ability to continue to innovate and outpace competition across the globe. — Ari Natter and Malathi Nayak

https://www.bloomberg.com/news/articles/2025-05-22/senate-votes-to-end-california-gas-car-ban-sends-bill-to-trump
A customer refuels at a Shell station in Hercules, California. Photographer: David Paul Morris/Bloomberg

The Latest

California Politicians Push 13-Bill Package to Rescue Downtowns
Trump's Funding Threats Build a Case for Private High-Speed Rail
Trump Ramps Up Criminal Charges Against Migrants in California
Edison Unveils $6.2 Billion Prevention Plan After LA Fires
LA Port Shipments Fell 30% in Early May After Trump Tariffs

Up Front

Just in time for Memorial Day weekend travel, a roughly 11-mile stretch of beach-hugging road on the Pacific Coast Highway is reopening on Friday after January's Palisades Fires closed it to outsiders.

The portion of highway runs from Santa Monica through Malibu, and averages more than 40,000 vehicles daily during the summer travel season. Its infamous traffic congestion will likely be worse in the years ahead as debris clearance and reconstruction continue.

Road rage aside, Malibu businesses may be happy to see a return in activity along the scenic drive. A survey found that 42% of Malibu businesses reported a loss of more than 75% of their profits since the wildfires, as residents and tourists were pushed away.

"Instead of having to hang a U-turn on PCH, Angelenos can now 'hang ten' with Malibu businesses and residents," State Assemblymember Jacqui Irwin said in a statement. — John Gittelsohn

The Pacific Coast Highway in Malibu, before the Palisades Fire. Photographer: Ed-Ni-Photo/iStockphoto

Filmmakers seeking the backdrop of Hollywood's most iconic sites will have an easier time now that Los Angeles Mayor Karen Bass has signed an executive order streamlining access to production permits.

Bass's order aims to cut the notorious costs and red tape that make it difficult to secure permits to film at places like Griffith Observatory and the Central Library. By giving producers a warmer welcome, the mayor aims to keep the film and TV industry from being lured away from LA.

Worries over "runaway production" have reached all levels of government. Trump's call for 100% tariffs on movies made overseas was the talk of the Cannes Film Festival this month. The president is also considering incentives suggested by his group of Hollywood ambassadors to make domestic production more attractive.

Meanwhile, Newsom has asked the White House for at least $7.5 billion in tax credits to bring more filmmaking to the US. The state of California has its own annual $750 million film tax credit program to create jobs and incentivize projects, which were hit hard by the pandemic in addition to competition from other states and countries.

"Keeping entertainment production in LA means keeping good-paying jobs in LA, and that's what we are fighting for," Bass said in the order. — Maxwell Adler 

Griffith Observatory in Los Angeles. Photographer: Bing Guan/Bloomberg

More From Bloomberg California

Tech In Depth
Musk's Political Backpedal Leaves X Searching for Relevance
Power On
Apple's $100 Billion-a-Year App Store Will Never Be the Same
Screentime
Warner Bros.' David Zaslav Tried to Rebrand HBO. It Didn't Work.
Bloomberg Weekend
How OpenAI Drifted Away From Its Noncommercial Roots
Money Stuff
Get Your Research From an AI Video

Opinion

Valuable rare earths lie just near Los Angeles, writes David Fickling, and should reassure us that we can surpass China in the battle for dominance over the minerals. In fact China is deeply dependent on the rest of the world for critical rare earths including ultra-rare Boron, 30% of which is mined in California's Mojave Desert.

More opinions:

Today's Big Number

$8.5 Billion
That was the valuation placed on the San Francisco 49ers after NFL owners approved the sale of a 6.2% stake to to three local families. That's the highest ever for a sports team.

Tech and Tinsel

Google is being investigated by the Justice Department over whether its agreement to use the AI technology of popular chatbot maker Character.AI violates antitrust laws. The probe is examining whether the two companies partnered up to avoid formal government merger scrutiny.

OpenAI made its biggest purchase in history—a nearly $6.5 billion all-stock deal for AI device company io. Co-founded by Jony Ive, the Apple veteran who designed the look of the modern smartphone, io will partner with OpenAI to create a "totally new" kind of consumer tech product.

Apple is shooting to join the smart glasses arena at the end of next year to rival Meta's Ray-Ban spectacles. On Tuesday, Google made its own entrance into the race by partnering with Xreal on the first glasses to run an AR version of its Android operating system.

Unions representing roughly 45,000 Disney theme park workers called on their company to protect employees it suspended after Trump's revocation of temporary protected status for Venezuelan migrants. Disney has suspended at least 45 employees without pay because of the order, and plans to fire them after 30 days if they don't get an alternative work authorization.

S&P cut Warner Bros. Discovery's credit rating to junk due to persistent declines in revenue and cash flow at its linear TV business. Junk ratings can boost a company's borrowing costs, but the firm remains ranked investment grade by two other top agencies for now.

Photographer: Eric Thayer/Bloomberg

Before You Go

Architect Frank Gehry's Grand LA mixed-use development aimed to introduce an oasis with housing, dining, retail and a movie theater across from the Walt Disney Concert Hall. But the project, which opened in 2023, is still struggling to fill its floors with tenants.

The view from Airlight on the 10th floor of Conrad Los Angeles, part of The Grand LA. Photographer: Jay L. Clendenin/Los Angeles Times via Getty Images
Follow Us

Like getting this newsletter? Subscribe to Bloomberg.com for unlimited access to trusted, data-driven journalism and subscriber-only insights.

Before it's here, it's on the Bloomberg Terminal. Find out more about how the Terminal delivers information and analysis that financial professionals can't find anywhere else.  Learn more.

Want to sponsor this newsletter? Get in touch here.

You received this message because you are subscribed to Bloomberg's California Edition newsletter. If a friend forwarded you this message, sign up here to get it in your inbox.
Unsubscribe
Bloomberg.com
Contact Us
Bloomberg L.P.
731 Lexington Avenue,
New York, NY 10022
Ads Powered By Liveintent Ad Choices
Share: