Trump proposes lowering fuel efficiency standards for passenger cars

President Donald Trump on Wednesday proposed deep cuts to strict fuel economy standards for passenger cars enacted under the Biden administration.

“We are officially ending Joe Biden’s ridiculously burdensome, and actually horrific, CAFE standards that imposed expensive restrictions,” Trump said in the Oval Office, surrounded by CEOs. ford motor and Stellantis.

Corporate Average Fuel Economy, or CAFE, standards date back to 1975 and have been tightened over the years to make vehicles more efficient.

Former President Joe Biden had asked automakers to increase the fuel efficiency of passenger cars and light trucks to about 50 miles per gallon by 2031. These stricter standards were expected to stimulate the production and sale of electric vehicles in the United States.

The standards proposed by the Trump administration require cars to get about 34 miles per gallon by 2031, according to the National Highway Traffic Safety Administration.

Trump has sought to dismantle pollution regulations and federal subsidies for electric vehicles as well as renewable energy since taking office.

The oil industry group, the American Petroleum Institute, has pressured the Trump administration to rescind Biden’s fuel economy standards, saying they aim to phase out liquid fuel vehicles.

The announcement was attended by Ford CEO Jim Farley and Stellantis CEO Antonio Velosa, in addition to a Ford plant manager. GM From Michigan.

Several officials in attendance, including U.S. dealers, said the new standards are more in line with the cars customers want to buy rather than the more expensive cars that automakers have been forced to produce because of regulations.

Trump and other officials also described the new regulations as helping with vehicle affordability, which has been an ongoing concern for the auto industry, where the average price of a new vehicle purchased is about $50,000.

The Alliance for Automotive Innovation, a trade group that represents the majority of automakers operating in the United States, also praised the cuts.

“We are reviewing NHTSA’s announcement, but are pleased that the agency has proposed new fuel economy standards,” John Bozella, the organization’s CEO, said in a statement. “We have been clear and consistent: The current CAFE rules finalized under the previous administration represent a significant challenge for automakers to achieve given the current market for electric vehicles.”

Tesla, the leading electric vehicle company in the United States, did not respond to comment regarding the reduced standards.

– CNBC Phil Lebo and Laura Kolodny She contributed to this report.