The Trump administration found that its decision to loosen efficiency standards for new cars could add on average roughly $1,600 in fuel costs for drivers — a higher jump than previous federal analysis suggested.
The Department of Transportation on Monday released a new analysis of the rule revising the nation’s fuel economy standards. The analysis shows Americans should save more on insurance, ownership taxes and other car-related expenses, but would face higher expenses for filling up their tanks.
Under the new rule, which President Donald Trump announced over the weekend, cars and small trucks will need to meet an average fuel economy standard of 34.9 miles per gallon by 2031. Under the Biden administration’s fuel economy standards, that target was 50.4 miles per gallon. In announcing the finalized rule, the Department of Transportation said the change would lower the average cost of a new vehicle by $1,300.
Transportation Secretary Sean Duffy said the Biden administration’s standards amounted to an “EV mandate,” and new standards would make cars more affordable and safer, and support auto workers.
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“Thanks to President Trump’s leadership, we have finally ended the illegal mandate that forced automakers to produce more expensive electric vehicles that American families didn’t want,” he said. “While Joe Biden and Pete Buttigieg pushed a green agenda that made our roads less safe and drove up costs for hardworking Americans, this administration is delivering relief to families and reviving the beating heart of American manufacturing.”
But the federal government’s analysis shows the changes would increase fuel costs for drivers by roughly $1,600. That estimate of how much the rule change will cost drivers has increased even since the rule was proposed; a federal analysis from last year estimated those costs would go up roughly $1,400. The extra fuel costs would be spread across the lifetime of a car, The National Highway Traffic Safety Administration said, or roughly 30 years.
Advocacy groups said the move would add an additional burden at a time when gas prices are rising.
“Families already cannot afford the basics, and now Donald Trump wants to make driving more expensive too,” said Katherine García with the Sierra Club. “Less fuel-efficient cars mean more gas burned, spending more at the pump, and dirtier air in our communities.”
The Sierra Club said it would “fight” the rollbacks, and the Natural Resources Defense Council teased possible legal action over the revised rules.
“Congress established fuel economy standards five decades ago after Middle East unrest led to a spike in oil prices,” said Atid Kimelman with NRDC.” But with the war with Iran driving up oil prices, the Trump administration is doing all it can to keep us dependent on gas guzzlers. In fact, most automakers would not need to make any fuel-economy improvements over the next five years to meet these new standards. This rollback is not only bad policy; it also violates the law. Stay tuned.”
The current U.S. fleet of cars and light trucks already get an average of 35.4 miles per gallon, as of 2024 estimates published in the federal analysis of the rule. That means cars and trucks are already more efficient than the standard the new rules set for 2031: 34.9 miles per gallon.
That’s because the new rules are based solely on gas and diesel-powered vehicles, and don’t incorporate the fuel economy of electric vehicles.
Andy Su, a lawyer with the Environmental Defense Fund, said setting the goal lower than the current fuel economy goes against the agency’s responsibility to set “maximum feasible” goals.
“[The National Highway Traffic Safety Administration] is required by law to improve fuel economy,” he said. “NHTSA’s new interpretation is inconsistent with nearly 50 years of agency practice and the best reading of the statute.”
Su said in addition to increased fuel costs, the new rule could contribute significantly to climate-warming emissions.
“The transportation sector is the nation’s largest source of climate pollution, responsible for 1.5 billion tons of climate pollution every year,” he said. A weaker standard could increase emissions by 1 billion additional tons of greenhouse gases by 2050, according Su’s analysis of the proposed rule.
Automakers celebrated the move. The Alliance for Automotive Innovation, which represents companies like General Motors, Ford, Subaru and Honda, said the revision was an “appropriate course correction” from Biden-era standards.
“We’re still reviewing the final rule, but NHTSA made the right call to better align fuel economy standards with the law and current market conditions,” John Bozzella, Alliance for Automotive Innovation president and CEO, said.
Bozzella emphasized the importance of long-term regulatory stability for the automotive industry.
The revision also eliminates a program that allowed carmakers to trade “credits,” which they earned when their vehicles were more fuel efficient than required. Previously, companies could purchase credits from EV companies to count toward their fleets’ overall fuel efficiency.
Carmakers will still be able to earn credits and use them within their own fleets, but under the new rule cannot trade them with other companies. The rule says that could allow manufacturers to work towards more fuel efficiency, instead of relying on credits from third-party EV makers.
The Trump administration has argued the credit trading system has “resulted in a windfall for EV-exclusive manufacturers,” who profit off non-EV manufacturers. Companies like Tesla and Rivian that produce EVs have raked in money from sales of those credits.
The final rule includes a transition period, eliminating the trading program in 2028.
Tesla and Rivian did not respond to requests for comment.
In a reaction on social media, former Transportation Secretary Pete Buttigieg said the new rule would weaken the U.S.’s ability to innovate, “handing the clean tech future to China and forcing Americans to pay more at the pump.”
Update: This story has been updated to include additional context about the fuel costs that could be passed on to drivers.
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