The mandate that the DoT challenged was a key part of former US President Joe Biden’s plan to address climate change.
The United States Department of Transportation (DoT) has declared that former President Joe Biden’s administration exceeded its authority by assuming a high uptake of electric vehicles in calculating fuel economy rules.
With that declaration on Friday, the DoT paved the way for looser fuel standards and published the “Resetting the Corporate Average Fuel Economy Program” (CAFE) rule. A future separate rule from the administration of President Donald Trump will revise the fuel economy requirements.
“We are making vehicles more affordable and easier to manufacture in the United States. The previous administration illegally used CAFE standards as an electric vehicle mandate,” Transportation Secretary Sean Duffy said in a statement.
The department’s National Highway Traffic Safety Administration (NHTSA), in writing its rule last year under Biden, had “assumed significant numbers of EVs would continue to be produced regardless of the standards set by the agency, in turn increasing the level of standards that could be considered maximum feasible,” it said Friday.
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A shift away from Biden policies
In January, Duffy signed an order directing NHTSA to rescind fuel economy standards issued under Biden for the 2022-2031 model years that had aimed to drastically reduce fuel use for cars and trucks.
In a release last year, the DoT, then led by Pete Buttigieg, put in place a required fuel economy to increase by 2 percent for cars made between 2027 and 2031.
At the time, the DoT said it would help save consumers upwards of $600 on gas every year. It was also part of the Biden administration’s plan to address climate change.
“These new fuel economy standards will save our nation billions of dollars, help reduce our dependence on fossil fuels, and make our air cleaner for everyone. Americans will enjoy the benefits of this rule for decades to come,” then NHTSA Deputy Administrator Sophie Shulman said at the time.
In June 2024, the NHTSA said it would hike CAFE requirements to about 50.4 miles per gallon (4.67 litres per 100km) by 2031 from 39.1mpg currently for light-duty vehicles.
The agency last year said the rule for passenger cars and trucks would reduce gasoline consumption by 64 billion gallons and cut emissions by 659 million metric tons, cutting fuel costs with net benefits estimated at $35.2bn.
Late on Thursday, Senate Republicans proposed eliminating fines for failures to meet CAFE rules as part of a wide-ranging tax bill, the latest move aimed at making it easier for automakers to build gas-powered vehicles.
Last year, Chrysler-parent Stellantis paid $190.7m in civil penalties for failing to meet US fuel economy requirements for 2019 and 2020 after paying nearly $400m for penalties from 2016 through 2019. GM previously paid $128.2m in penalties for 2016 and 2017.
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Stellantis said it supported the Senate Republican proposal “to provide relief while DoT develops its proposal to reset the CAFE standards … The standards are out of sync with the current market reality, and immediate relief is necessary to preserve affordability and freedom of choice.”
GM declined to comment.