President Donald Trump on Saturday announced he is scrapping the stricter fuel economy standards put in place under President Joe Biden, replacing them with a new policy his administration says will lower vehicle costs and support domestic auto manufacturing.
The change marks the latest swing in a long-running back-and-forth over Corporate Average Fuel Economy (CAFE) standards, which have governed the mileage automakers must achieve since 1975 and are periodically revised by each administration. Trump had already loosened these standards once before, during his first term, reducing an Obama-era requirement of a five percent annual efficiency increase down to 1.5 percent per year. Biden reversed that approach after taking office, pushing for tighter standards intended to accelerate the shift toward electric vehicles as part of his broader climate agenda.
Under the rules Biden’s administration put in place, automakers would have needed to raise the fuel efficiency of passenger cars and light trucks to roughly 50 miles per gallon by 2031, according to CNBC. Trump’s new policy undoes that requirement, though the final details of the replacement standards have not yet been issued.
Trump announced the move on Truth Social, criticizing both Biden and former Transportation Secretary Pete Buttigieg by name. “BIG DAY FOR AMERICAN AUTO WORKERS AND CAR BUYERS! I have just approved new Fuel Economy Standards that TERMINATE Sleepy Joe Biden and Pete Boot-EDGE-EDGE’s ridiculous EV Mandate,” he wrote. “The Dumocrats cost our Great Auto Manufacturers $Billions, forced Americans into cars they never wanted, and wasted Billions on Chargers that were never built.”
These new Standards will take the waste out of building cars in America. That means LOWER PRICES, saving families thousands on a new, beautiful, and safe car — Far better than the Environmental Monsters that we were building heretofore. Every Manufacturer, from General Motors to Ford to Stellantis, has called me wanting to build here, and now they can!
Trump also said that automakers are investing more than $100 billion in U.S. production, and predicted the change would bring plants and jobs back to the Midwest and the South.
The rollback fulfills a promise Trump made during his 2024 campaign to undo policies that encouraged or required electric vehicle production.
Industry analysts say looser CAFE standards typically benefit automakers’ bottom lines by allowing them to build more pickup trucks and SUVs, which are more profitable than smaller cars but get worse gas mileage. “Weaker fuel economy standards mean that automakers can produce more pickup trucks and SUVs, which are much more profitable than smaller cars but have worse gas mileage,” CNBC reported.
Electric vehicle sales have also fallen short of the projections once made by manufacturers and environmental advocates. While Tesla continues to maintain a loyal customer base and General Motors still plans to offer EV models, automakers broadly appear to be pulling back from the aggressive electrification plans pursued in recent years.
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