US to announce sharply lower vehicle fuel economy requirements

The Trump administration is set to unveil dramatically reduced vehicle fuel economy requirements, reversing a push by the Biden administration to incentivize more fuel-efficient car manufacturing. Transportation Secretary Sean Duffy hinted at the forthcoming announcement on Monday, alluding to an expected 34.5 miles per gallon average fleetwide by 2031, significantly lower than the 50.4 miles per gallon standard under the Biden administration.

The administration's objective is to align automobile production with consumer preferences rather than dictated by political agendas. Biden's administration, on the other hand, emphasized the reduction of greenhouse gas emissions and fossil fuel consumption, aiming to establish the U.S. as a leader in clean energy technology and manufacturing.

The National Highway Traffic Safety Administration (NHTSA) had proposed to retroactively reduce the 2022 fuel economy standard and then incrementally raise it until 2031. Biden's measures aimed to spur automakers into developing more electric vehicles to meet the escalating fuel efficiency standards. Despite NHTSA's estimate that the proposal could lower new vehicle costs by $930, it would simultaneously increase fuel consumption by around 100 billion gallons through 2050, adding $185 billion to fuel expenses and contributing to a 5% rise in carbon dioxide emissions.

Congress eliminated penalties for non-compliance with fuel economy standards in 2025, saving automakers millions of dollars and revoked tax incentives for the purchase of electric vehicles in the same year. Additionally, California's authority to ban gasoline-powered vehicles by 2035 was rescinded, a decision that the state is currently contesting.