US Government Presents Regulatory Gift to Gas Automakers
US Distillate Stocks Continue to Fall As Crude Inventories Build With over two decades of journalistic experience working in newspapers, trade publications and as a mining reporter, Andrew Topf is a seasoned writer specializing in… The US government on Monday finalized new lower vehicle fuel economy standards — reversing a push by the Biden administration to build more fuel-efficient vehicles.
The move is broadly seen as helping sales of gas-powered cars and trucks at the expense of electric vehicles.
The Alliance for Automotive Innovation called the rollback an “appropriate course correction” that aligns fuel economy standards with market realities and legal requirements.
(Automotive News) Environmental groups countered that the rollback gives automakers a break while US drivers continue to grapple with sharply higher fuel prices due to the war in Iran.
The Transportation Department said it was finalizing a fleetwide average of 34.9 miles per gallon (14.7 km per liter) by 2031, down from 50.4 miles per gallon (21.4 km per liter) under Democratic former President Joe Biden.
In 2024, the Biden administration finalized rules to push automakers to build more electric vehicles to meet rising fuel-efficiency standards.
Biden increased required fuel efficiency for cars by 8% annually for model years 2024 and 2025, 10% for 2026 and 2% annually from 2027 to 2031.
The lower standards mean higher global carbon emissions, a slowdown in the worldwide shift to electric vehicles, and a strategic retreat by the US from the global clean-energy race.
American drivers will burn more gasoline, adding billions of tons of extra greenhouse gases into the atmosphere and undermining global climate goals.Related: US Distillate Stocks Continue to Fall As Crude Inventories Build The policy encourages the production of larger, less efficient gas-powered trucks and sports utility vehicles, keeping global oil demand high for decades.
It also ends a credit-trading system automakers used to comply with requirements, effective in model-year 2028, thus removing a major financial cushion for pure electric vehicle pioneers like Tesla and Rivian.
International car companies such as Toyota, Volkswagen and Hyundai can now sell more profitable gas vehicles in the US while keeping EV development focused elsewhere.
The Trump administration estimates technology costs will drop $60.6 billion through 2031, with Stellantis saving $6.6 billion, Ford $5.8 billion, Toyota $4.5 billion and Honda $4.1 billion, Automotive News reports.
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