Trump Administration Rolls Back MPG Standards, But Is It A False Economy?

Key Takeaways

• The Trump administration has rolled back fuel economy standards, allowing automakers to make thirstier cars.
• Automakers are now expected to hit a fleet average of 34.9 mpg, down from 50.4 mpg.
• The move could make new cars more affordable, but may not help with high gas prices.
• Automakers including General Motors, Ford, and Stellantis have voiced their support for the rollback.
• The NHTSA is also outlawing the practice of automakers trading CAFE credits.

What Do the New MPG Standards Mean?

The Department of Transportation and National Highway Traffic Safety Administration say automakers will now need to achieve a fleet-wide average of 34.9 mpg for cars and light trucks by MY31.

This is a huge drop from the 50.4 mpg they would have been required to meet under the old Biden rules.

The Trump administration claims the shift could make new cars more affordable for Americans, the DOT suggesting it could chop $1,300 off the price of a new car and save consumers $138 billion over five years.

Why Are Automakers Supporting the Rollback?

Automakers including General Motors, Ford, and Stellantis have voiced their support for the rollback, the Alliance for Automotive Innovation trade body saying the new rules “better align fuel economy standards with market conditions.”

However, the move has been criticized by environmental campaigners, who argue that less fuel-efficient cars mean more gas burned, spending more at the pump, and dirtier air in our communities.

What Does This Mean for Electric Vehicle Manufacturers?

The NHTSA is also outlawing the practice of automakers trading CAFE credits.

In the past, EV brands like Tesla could sell credits to makers of combustion cars, generating billions of dollars of additional income.

The White House said the ability to sell credits “artificially propped up the EV industry” at the expense of other automakers.

How Will This Affect Gas Prices?

The Trump administration claims the shift could make new cars more affordable for Americans, but may not help with high gas prices.

With gas prices currently at almost $4.50 per gallon, the move to make cars more fuel-hungry may not be the most cost-effective solution for consumers in the long run.

Frequently Asked Questions

Q: What are the new MPG standards?

The new MPG standards require automakers to achieve a fleet-wide average of 34.9 mpg for cars and light trucks by MY31.

Q: Why are automakers supporting the rollback?

Automakers including General Motors, Ford, and Stellantis have voiced their support for the rollback, saying the new rules “better align fuel economy standards with market conditions.”

Q: How will this affect electric vehicle manufacturers?

The NHTSA is outlawing the practice of automakers trading CAFE credits, which may affect EV brands like Tesla that have relied on selling credits to makers of combustion cars.