U.S. Cuts 2031 Fuel-Economy Target to 34.9 MPG
The U.S. Department of Transportation has finalized a rule setting the 2031 fleet average at 34.9 miles per gallon, replacing the prior 50.4 mpg target. The target for model year 2024 was 30.1 mpg The Verge.
That is a cut of more than 15 mpg from the prior trajectory. The department described it as among the largest deregulatory actions under the second Trump administration.
President Donald Trump said on Sept. 26, 2026, that he had approved new fuel economy standards ending the Biden EV mandate CNBC. The administration framed the move as a reversal of stricter Biden policies meant to spur electric vehicle adoption. The Transportation Department said its rule "restores integrity to the national fuel economy program, balancing vehicle affordability and energy conservation goals" U.S. DOT.
The mechanism is Corporate Average Fuel Economy, or CAFE, administered by the National Highway Traffic Safety Administration. It is a sales-weighted average across an automaker's new cars and light trucks. NHTSA labels the action Final Rule: CAFE Standards for MYs 2022-2031 Passenger Cars and Light Trucks.
Under Biden-era rules for model years 2027-2031, passenger-car economy was to rise 2% per year. The full Biden ramp required 8% annual gains for cars in model years 2024 and 2025, 10% in model year 2026, and 2% annually from 2027 to 2031 Reuters.
Automakers now face a lower average through the decade, with less need to offset gasoline sales with hybrids and battery-electric models. NHTSA described the reset as realigning the program with Congressional intent. It has published a Final Environmental Impact Statement on the environmental effects of the standards and reasonable alternatives.
The cost claims differ. The Trump administration said its plan would lower the average new-vehicle cost by $1,300 and save $138 billion over five years. The Biden standards were projected to save $23 billion in fuel, or more than $600 in gasoline over a vehicle's life for an owner.
NHTSA has said it has issued CAFE standards since the late 1970s to cut fuel use. A similar shift happened before. In the 2020 rollback, the fleet was to average 40.4 miles per gallon rather than 46.7 mpg under Obama-era rules Reuters.
The broader context here is powertrain planning when rules shift. CAFE sets the pace for small turbocharged engines, hybridization, weight cuts, aerodynamics, and the share of electric miles sold. A slower climb lowers near-term compliance pressure and leaves more room to keep investing in gasoline platforms.
In my view, the lasting question is what automakers do with that room. Rules have swung for decades while batteries, power electronics, and software control have steadily improved. I watched my children learn to drive during the last rollback, when sticker prices and fuel costs shaped their first used cars more than Washington rules. Turnover is slow, fuel costs bite, and low running costs still sell.
Worth flagging for technology readers is the effect on engineers and suppliers. Looser averages ease yearly pressure, but rivalry on ownership cost, performance, and factory scale goes on. We have seen this pattern before, when steady work on efficient designs paid off, and firms that treat this pause as time to build are likely to cope better when rules tighten again.
