Things to know about the Trump administration order on miles per gallon for cars and pickups

[January 30, 2025]  By ALEXA ST. JOHN

DETROIT (AP) — Hours after being sworn in as the new U.S. Secretary of Transportation, Sean Duffy took aim at the main way the federal government regulates miles per gallon for cars and pickup trucks — also a principal way that it regulates air pollution and addresses climate change. Duffy ordered the federal agency in charge of fuel economy standards to reverse them as soon as possible. The standards have been in place since the 1970s energy crisis and were intended to conserve fuel and save consumers money at the gas pump.

Here are five things to know about the action.

What is the Trump administration doing exactly?

Duffy ordered his chief of the National Highway Traffic Safety Administration to "propose the rescission or replacement of any fuel economy standards" necessary to bring the rules in line with Trump's priority of promoting oil and biofuel.

The order came in a DOT memorandum Tuesday night. Duffy said the rules need to better align with the administration’s overarching agenda because “the existing CAFE standards promulgated by NHTSA are contrary to Administration policy.”

Duffy is a former Republican congressman from Wisconsin without experience in transportation. At his confirmation hearing earlier this month, Duffy promised safer Boeing planes, less regulation and help for U.S. self-driving technology companies. He has publicly questioned climate change.

The NHTSA chief would have to initiate a full rule-making process to set looser standards, which took two years during the first Trump administration. When he came into office the first time, rules from the Obama administration were going to require miles per gallon increase 5% each year, but by 2020, the DOT under Trump was able to loosen that to 1.5% each year through model year 2026.

What does this mean for consumers and the climate?

Duffy says eliminating the rules will increase Americans' access to the full range of gasoline vehicles they need and can afford.

Others disagree. “This will raise consumer’s costs at the pump, increase tailpipe pollution and jeopardize U.S. automakers’ future, and no one voted for any of it. The only beneficiaries will be oil executives and China’s auto industry, which will be happy to sell electric vehicles around the world with little U.S. competition,” said Dan Becker, director of the Center for Biological Diversity’s Safe Climate Transport Campaign.

In recent years, automakers have been producing gasoline cars that get significantly better mileage, which lowers the cost of driving and means lower sales for oil companies — both refineries and producers.

Transportation was the largest contributor to U.S. greenhouse gas emissions in 2022, according to the Environmental Protection Agency. Every atom of carbon pumped into a car's gas tank comes out the tailpipe and many combine with oxygen to make carbon dioxide which holds onto extra heat for more than a century.

Why does Trump want to repeal fuel efficiency rules?

Duffy’s action aligns with a number of President Trump’s promises, notably to end an “electric vehicle mandate” — referring to former President Joe Biden’s target for 50% of new car sales to be electric by 2030.

Duffy wrote “These fuel economy standards are set as such aggressive levels that automakers cannot, as a practical matter, satisfy the standards without rapidly shifting production away from internal-combustion-engine vehicles to alternative electric technologies.”

The standards do not kick in immediately, but instead allow automakers time to adjust their designs and production in order to meet them.

The new Secretary said “artificially high” standards force car manufacturers to phase out gasoline powered vehicles, making cars more expensive for buyers and “destroying consumer choice at the dealership.”

Traffic flows on Interstate 435 on Sept. 25, 2024, in Leawood, Kan. (AP Photo/Charlie Riedel, File)

“It’s hard to understand this action in the context of trying to reduce costs for consumer and help U.S. industry be more competitive, since this will have the opposite effects,” said Roland Hwang, policy director at the University of California, Davis Institute of Transportation Studies.

“Creating this regulatory uncertainty puts a tremendous number of automaker jobs and investments at risk, and undercuts the American auto industry’s global competitiveness,” he added. “Strong fuel economy standards are critical to ensure automakers are investing in advanced technologies necessary” to do so.

There is no requirement for automakers to produce or consumers to purchase electric vehicles. The fuel economy standards work in sync with EPA limits on carbon dioxide from vehicle tailpipes to address climate change, which Trump also rejects.

“It’s reasonable for the new leadership at the Transportation Department to review current fuel economy standards,” said John Bozzella, president and CEO Alliance for Automotive Innovation, a group that represents the industry. “As we’ve said, the existing CAFE rules are extremely challenging to achieve – even in the best of circumstances. They also expose automakers to billions of dollars in civil penalties."

Duffy said CAFE rules are supposed to establish realistic rules for fleets “that run on combustible liquid fuels like gasoline and diesel fuel.” He also cited the nation’s vast oil reserves, biofuel feedstocks and refining capacity as reason to establish lower standards.

Trump has issued a series of orders including an energy emergency declaration, and has said the U.S. will “drill, baby, drill.”

What's the idea behind American fuel economy standards?

CAFE, or Corporate Average Fuel Economy, rules date back to oil shocks Americans suffered in 1974 and 1980. The first ones went into effect in 1978. They are intended to help drivers use less fuel by requiring automakers' fleets to meet average mile-per-gallon targets that initially increased with each model year, until progress stalled in the 1980s.

Americans then saw no appreciable improvement in miles per gallon for around two decades. In recent years, automakers have offered car-buyers plenty of internal combustion engine — meaning gasoline-powered — cars with much better mileage, and that is largely due to increasingly stringent standards.

What were the latest fuel economy rules going to do?

The latest standards set under the Biden administration required automakers to average about 38 miles per gallon of gas by 2031. That's in real-world driving. The current average is around 28 miles per gallon.

In every model year from 2027 to 2031, the rules are supposed to increased fuel economy 2% per year for passenger cars, while SUVs and other light trucks are set to increase by 2% a year from 2029 to 2031. An earlier proposal had even higher requirements.

The standards aligned with tighter Biden-era EPA limits on pollution from passenger and commercial vehicles, and the former president's broader support for incentivizing electric vehicle manufacturing and purchases.

The Biden administration said when it made the rules they would save almost 70 billion gallons of gasoline through 2050.

Bozzella said U.S. tailpipes are overseen by three federal agencies and multiple rules, so changes the Trump administration proposes to the CAFE standards will have to be coordinated with the other emissions rules overseen by EPA and the Energy Department.

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Alexa St. John is an Associated Press climate solutions reporter.

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