Trump administration slashes fuel economy standards for cars, light trucks: Here’s what changes

The Trump administration on Monday unveiled revised fuel economy standards for automakers that would ease requirements for gasoline-powered cars and light trucks, with the industrywide average projected at 34.9 miles per gallon in 2031, down from 50.4 miles per gallon under rules introduced by the Biden administration.

The rules were announced shortly after President Donald Trump turned down an Iranian proposal to reopen the Strait of Hormuz, a development that sent oil prices sharply higher.

Fuel economy regulations determine the distance vehicles must travel on a gallon of gasoline. The latest changes advance Trump’s pledge to roll back policies that, according to his administration, promoted or incentivised the manufacture and adoption of electric vehicles.

Transportation Secretary Sean Duffy said the administration had delivered on Trump’s promise to roll back what he described as an unlawful requirement that pushed automakers to manufacture costlier electric vehicles that many American consumers did not want.

In a statement highlighting vehicle affordability, safety and investment in US auto workers, Duffy said, “Thanks to President Trump’s leadership, we have finally ended the illegal mandate that forced automakers to produce more expensive electric vehicles that American families didn’t want.”

The National Highway Traffic Safety Administration (NHTSA) had estimated in December that the revised standards would result in an average fuel economy of around 34.5 miles per gallon.

NHTSA says new fuel rules balance affordability, safety and energy conservation

NHTSA Administrator Jonathan Morrison said the new rule would bring greater integrity to the national fuel economy programme by balancing vehicle affordability with energy conservation while also enhancing road safety.

He said lower vehicle prices could make newer and safer cars more accessible to American families, while more flexible standards would give automakers greater scope to develop vehicles that align with consumer demand. Morrison also praised the agency’s engineers, economists and lawyers for their work in finalising the rule.

GM tech costs to decline by $20.4 billion through 2031: US

General Motors is expected to save $20.4 billion in technology costs through 2031 following the Trump administration’s decision to significantly ease vehicle fuel economy requirements, the US Transportation Department said.

Across the auto industry, the administration estimates the revised standards will reduce technology-related costs by $60.6 billion through 2031, equivalent to about $1,289 per vehicle. Under the fuel economy rules introduced in 2024, GM’s technology costs had been projected to reach $31.7 billion over the same period.

Trump says relaxed mileage rules will cut car costs, boost US production

Trump said in a post on his Truth Social account on Saturday that the relaxed mileage requirements would “take the waste out of building cars in America” and save families “thousands on a new, beautiful and safe car,” while also encouraging greater vehicle production in the United States.