The US administration has finalised a new rule that relaxes fuel-economy standards for cars and pickup trucks, further rolling back policies previously introduced to support the uptake of electric vehicles and hybrids (US Department of Transportation press release, 28/09/2026). In 2024, the Biden administration finalised rules aimed at encouraging automakers to produce more electric vehicles in order to comply with increasingly stringent fuel-efficiency requirements (corporate average fuel economy (CAFE) standards). The rules raised required fuel efficiency for cars by 8%/year for model years 2024 and 2025, 10% for 2026, and 2%/year from 2027 to 2031.
Under the newly approved Safer Affordable Fuel Efficient (SAFE) Vehicles Rule III standards, cars and trucks will be required to reach an average fuel economy of 34.9 miles per gallon (14.7 km/l) by model year 2031, compared with the 50.4 miles per gallon (21.4 km/l) standard established by former President Biden in 2024. The US National Highway Traffic Safety Administration (NHTSA) said the revised requirements are expected to reduce the price of a new vehicle by approximately USD1,300.
“With these new standards, yearly oil consumption in 2050 is projected to be reduced by about 1.3 billion barrels as compared to yearly oil consumption in 2024”, according to the department’s own estimates.
The Republican-led US Congress had already effectively overturned the NHTSA’s fuel-economy standards in 2025 by voting to remove all non-compliance penalties applicable to automakers. Under the same legislation, Congress also repealed the USD7,500 tax credit for electric vehicles. Separately, the Trump administration repealed all climate regulations applying to cars and trucks earlier in 2026, while also preventing California from enforcing clean-car standards intended to encourage a shift toward electric vehicles. Critics argue that these combined measures could enable Chinese automakers to gain market share from US manufacturers in electric vehicle production (Argus Media, 28/09/2026).
Interested in Global Energy Research?
Enerdata's premium online information service provides up-to-date market reports on 110+ countries. The reports include valuable market data and analysis as well as a daily newsfeed, curated by our energy analysts, on the oil, gas, coal and power markets.
This user-friendly tool gives you the essentials about the domestic markets of your concern, including market structure, organisation, actors, projects and business perspectives.