BY COMFORT OGBONNA
President Donald Trump on Wednesday announced a sweeping proposal to dramatically scale back the fuel economy standards finalized last year under former President Joe Biden. The move is designed to ease the path for automakers to continue producing and selling gasoline-powered vehicles, reversing one of Biden’s key climate initiatives aimed at encouraging the shift to electric vehicles.
Trump argued that the rollback aligns with consumer preference, asserting that “people want the gasoline car.” His administration’s plan would significantly reduce the fuel efficiency requirements set by the National Highway Traffic Safety Administration (NHTSA), cutting the 2031 target from 50.4 miles per gallon to 34.5 miles per gallon — a major step back from Biden-era goals intended to push the auto market toward cleaner transportation.
Under the new proposal, NHTSA would also revise downward the standards for earlier model years and implement only very modest annual increases of 0.25% to 0.5% through 2031. By contrast, the Biden administration had required automakers to boost efficiency by 8% annually for 2024–2025 and 10% in 2026. While Biden’s rules aimed to steadily increase electric vehicle production, they did not mandate an immediate phase-out of gasoline engines.
According to NHTSA estimates, Trump’s plan would lower upfront vehicle costs by about $930 on average. However, the long-term trade-offs are steep: U.S. drivers could use an additional 100 billion gallons of fuel through 2050, spending up to $185 billion more at the pump while contributing to a roughly 5% rise in carbon dioxide emissions. The agency also noted that reverting to weaker standards could increase emissions in 2035 by the equivalent of what 7.7 million additional vehicles would produce in a year.
Automakers stand to benefit significantly from the changes. A NHTSA analysis suggests the industry could save $35 billion through 2031, with General Motors projected to save $8.7 billion and both Ford and Stellantis saving more than $5 billion each. The proposal also includes major structural changes to the program, including ending automaker credit trading in 2028 and eliminating certain credits for fuel-saving technologies. NHTSA claimed that credit trading had become a “windfall” for manufacturers focused solely on EVs, allowing them to sell credits to companies still producing traditional vehicles.
California Governor Gavin Newsom sharply criticized the move, warning that scaling back fuel economy standards would force Americans to spend billions more on fuel while worsening air pollution. Transportation remains the largest single source of greenhouse gas emissions in the United States.
Trump’s announcement follows legislation he signed earlier this year ending fuel economy penalties for automakers, effectively canceling fines dating back to the 2022 model year. Ending credit trading could hit companies like Tesla and Rivian, which have relied on selling credits to traditional automakers as an additional revenue stream.
At the White House event unveiling the proposal, Trump appeared alongside senior leaders from the auto industry, including the CEOs of Ford and Stellantis. Ford CEO Jim Farley said the company plans to focus more on affordable vehicles, calling the decision “a victory for common sense and affordability” and emphasizing that consumers should be able to choose what they drive.
While Trump claimed that vehicle prices are falling, industry data paints a different picture. As of September, new vehicle prices were up 0.8% year-over-year, and in October, Kelley Blue Book reported that the average cost of a new car in the U.S. surpassed $50,000 for the first time — a 3.6% increase from the previous year.
General Motors CEO Mary Barra recently noted that before Congress blocked California’s zero-emission vehicle mandate, automakers faced requirements in some states that 35% of new vehicle sales in 2026 be electric — a target she said could have forced manufacturers to shut down plants due to production and demand mismatches.
The Biden administration’s earlier fuel economy rule was ambitious, projecting reductions of 64 billion gallons of gasoline and 659 million metric tons of emissions, with estimated net benefits of more than $35 billion for drivers through lower fuel costs. The standards finalized in 2022 were expected to save more than 200 billion gallons of fuel through 2050.
Environmental advocates slammed Trump’s new approach, arguing it prioritizes the oil industry over American consumers. Kathy Harris of the Natural Resources Defense Council said the proposed rules would leave drivers paying hundreds more at the pump each year and undermine efforts to accelerate cleaner transportation technologies.
Trump has repeatedly taken steps to favor gas-powered vehicles, including eliminating EV tax credits and preventing California from enforcing its plan to ban the sale of new gasoline-powered cars after 2035. His latest proposal marks one of the most significant rollbacks of climate-focused transportation policy in recent years, setting up a major policy battle over the future of America’s auto industry.
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