Biden Administration to Unveil Tougher Fuel Economy Standards

The Biden Administration plans to unveil tougher fuel economy standards for vehicles on Friday. The new standards will reverse the Trump Administration’s rollback of U.S. regulations aimed at improving gas mileage and cutting tailpipe pollution.

The Department of Transportation reports Transportation Secretary Pete Buttigieg and National Highway Traffic Safety Administration (NHTSA) Deputy Administrator Steven Cliff will make a "major announcement" on fuel economy standards on Friday.

In August, NHTSA proposed hiking Corporate Average Fuel Economy (CAFE) requirements by 8% annually for the 2024 through 2026 model years. The organization reports the proposed rules will reduce consumer fuel costs by $140 billion for new vehicles sold by 2030 and $470 billion by 2050 and increase the estimated fleetwide average by 12 miles per gallon (mpg) for 2026, relative to 2021.

U.S. law requires 18 months lead time requiring the final NHTSA rules to be signed by March 31 to take effect in the 2024 model year that begins in September 2023.

The Biden Administration has asked for $27.5 million to support the next phase of NHTSA fuel economy regulations "for light vehicles and maximum fuel efficiency standards for medium- and heavy-duty trucks” noting the changes represent “meaningful progress toward achieving the administration's climate agenda.”

The Environmental Protection Agency (EPA) finalized stricter vehicle emissions requirements in December. The EPA predicts the change will avoid 3.1 billion tons of CO2 emissions through 2050.

NHTSA confirmed that it had reinstated a sharp increase in penalties for automakers whose vehicles do not meet fuel efficiency requirements for model years 2019 and beyond. The could cost automakers hundreds of millions of dollars or more.

Originally posted on Auto Dealer Today