Trump Administration Proposes Rule Reducing Fuel Economy Standards
The Trump administration has proposed changes to the Corporate Average Fuel Economy program and to reduce the fuel economy standards imposed by the previous administration under the CAFE program in 2024 (Reuters).
What’s going on: The National Highway Traffic Safety Administration aims to cut fuel economy requirements for cars with model years 2022 to 2031, reducing the standard to “34.5 miles per gallon on average by 2031, down from 50.4 miles per gallon.”
- The proposal would decrease the standard for 2022, then institute annual increases of 0.25% and 0.5% through 2031.
Why it matters: “The agency estimates the proposed rule would reduce average up-front vehicle costs by approximately $900, but would significantly boost American fuel consumption. Reducing the rule for past years will make it much easier for automakers to comply for a period still being reviewed by NHTSA.”
- Earlier this year, Congress passed legislation that removed fuel economy penalties for automakers.
Ending credit trading: The new proposal will also do away with credit trading among automakers, while also ending some credits for “fuel-saving features.”
What they’re saying: “Ford CEO Jim Farley praised Trump, in a statement ahead of the event, for ‘aligning fuel economy standards with market realities. We can make real progress on carbon emissions and energy efficiency while still giving customers choice and affordability.’”