US to announce sharply lower vehicle fuel economy requirements

NHTSA estimated its proposal would cut new vehicle costs by $930 each. But it would increase fuel consumption by around 100 billion gallons through 2050, fuel spending by $185 billion and carbon dioxide emissions by about 5%.

Congress decided in 2025 to no longer collect penalties for failure to meet vehicle fuel economy standards, saving automakers hundreds of millions of dollars, and ended $7,500 tax breaks for consumers who buy EVs. It also rescinded California's authority to outlaw gasoline-powered vehicles by 2035, a move the state is challenging.

The Trump administration will soon announce sharply lower vehicle fuel-economy standards, reversing a push by the prior administration to force automakers to build more fuel-efficient vehicles, Transportation Secretary Sean Duffy said Monday.

Under Republican President Donald Trump, the federal government has not detailed the final standard, but automakers expect it to be similar to a December proposal from the National Highway Traffic Safety Administration. That proposal called for a fleetwide average of 34.5 miles per gallon (14.7 km per liter) by 2031, down from 50.4 miles per gallon (21.4 km per liter) under former President Joe Biden, a Democrat.