WASHINGTON — In a move that underscores the second Trump administration's aggressive deregulation agenda, President Donald Trump announced on Wednesday the termination of the Biden-era Corporate Average Fuel Economy (CAFE) standards, labeling them "costly and unlawful" and a "green new scam." The decision, unveiled during an Oval Office event flanked by auto industry executives, aims to ease regulatory burdens on automakers, lower vehicle prices, and bolster domestic manufacturing, but it has drawn sharp criticism from environmental groups and scientists who warn of increased emissions and vulnerability to climate-driven disasters.
Speaking directly to the American public, Trump emphasized the policy's immediate benefits for consumers and workers. "Today, my administration is taking historic action to lower costs for American consumers, protect American auto jobs, and make buying a car much more affordable," he declared. The president, joined by CEOs from Ford, General Motors, and Stellantis, highlighted how the Biden standards—finalized in 2022—imposed annual fuel efficiency increases of 8% for model years 2024–2025 and 10% for 2026, pushing the industry-wide average toward 50 miles per gallon by 2031. Under the new reset, standards revert to a more modest 0.5% annual increase from the 2022 baseline, targeting about 34 miles per gallon by 2031, achievable primarily through improvements in conventional gasoline and diesel engines.
The White House fact sheet accompanying the announcement detailed the economic rationale, projecting $109 billion in total savings for American families over five years by averting an estimated $1,000 hike in the average new vehicle price. Officials argued that the Biden rules effectively mandated a shift to electric vehicles (EVs) by making compliance with gas-powered fleets prohibitively expensive, violating congressional intent under the 1975 Energy Policy and Conservation Act that established CAFE. Transportation Secretary Sean Duffy echoed this, stating the previous targets were "unattainable" and designed to "force a shift to electric and hybrid vehicles in violation of existing law."
Trump also touted broader investments in the U.S. auto sector, claiming $70 billion is now flowing into domestic production—a figure tied to recent policy incentives like tariff offsets on imported parts and tax deductions for U.S.-assembled vehicles under the One Big Beautiful Bill Act. "People were paying too much for a car that didn't work as well, and now they're going to have a great car that's going to be environmentally friendly, but it's going to cost you a lot less, and it's going to work great. All of the nonsense is being taken out of the cars," Trump said, gesturing to prototypes of redesigned internal combustion engine models displayed in the Rose Garden. Ford CEO Jim Farley praised the move as a "win for customers and common sense," noting it aligns standards with "market realities" while allowing progress on emissions without sacrificing affordability. Stellantis CEO Antonio Filosa added that the reset supports a "growing U.S. automotive industry," potentially safeguarding thousands of jobs in Rust Belt states like Michigan and Ohio.
The policy builds on earlier Trump actions, including a June joint resolution nullifying California's EV mandate—which would have banned new gas car sales by 2035 and influenced 17 other states—and the elimination of CAFE civil penalties in July's Working Families Tax Cuts Act. These steps, administration officials say, have already spurred a 10% drop in automotive imports year-over-year, fostering a "resilient domestic industrial base." General Motors, for instance, is reallocating $4 billion from EV projects to gasoline-powered pickups and SUVs at its Orion Assembly plant in Michigan, a shift welcomed by union leaders amid slowing EV demand.
Critics, however, decry the rollback as a dangerous concession to fossil fuel interests at the expense of public health and planetary stability. The Sierra Club called it a step that "will make cars burn more gas and American families burn more cash," arguing that fuel-efficient vehicles save drivers thousands annually in fuel costs. Under Biden's standards, the National Highway Traffic Safety Administration projected savings of 70 billion gallons of gasoline through 2050, $23 billion in fuel expenses, and avoidance of 710 million metric tons of CO2 emissions—equivalent to removing 150 million cars from roads for a year. Environmental advocates note that while upfront vehicle prices might dip slightly, long-term pump costs could rise by $600 per vehicle lifetime due to lower efficiency.
This tension is amplified by the scientific community's near-unanimous consensus on global warming's human causes and consequences. Peer-reviewed research has found over 99% agreement that anthropogenic greenhouse gases, primarily from fossil fuel combustion in vehicles and power plants, drive recent warming trends. Global temperature records confirm the last decade as the warmest on record, exacerbating extreme weather. The Intergovernmental Panel on Climate Change links this warming to intensified events: heatwaves far more likely, heavy precipitation more intense, and agricultural droughts significantly more probable in affected regions.
Recent examples abound. In the U.S., 2025 has seen record-shattering wildfires in California scorching millions of acres, fueled by drier conditions and hotter temperatures. Hurricane season peaked with powerful storms causing tens of billions in damage and loss of life, events now more intense due to warmer oceans. Globally, extreme flooding events have become more frequent and severe, with climate models attributing much of the increase directly to human-induced warming. Soaring temperatures have also expanded the range of vector-borne diseases, with significant rises in cases linked to changing habitats.
Trump has long dismissed these realities, reiterating Wednesday that global warming is a "Chinese hoax" engineered to undermine U.S. manufacturing. Yet public opinion has shifted markedly: recent surveys show three-quarters of Americans now believe climate change is significantly affecting extreme heat, wildfires, and droughts—up substantially in just a few years—as personal experience with severe weather grows.
The rollback's legal path forward remains uncertain. The National Highway Traffic Safety Administration must finalize the rule through public comment, potentially facing lawsuits from states like California, where officials vow to challenge the revocation of emission waivers. Automakers, while supportive, face planning headaches from repeated regulatory whiplash—Obama tightened, Trump loosened, Biden retightened, and now Trump again—complicating multi-year production cycles. Industry groups have welcomed the proposal but urged long-term stability for ongoing investments in both traditional and electrified vehicles.
As another intense weather year draws to a close, the CAFE reset crystallizes America's ongoing climate crossroads. Proponents see it as economic liberation, freeing families from burdensome green mandates amid lingering inflation concerns. Detractors fear it accelerates a dangerous feedback loop: more emissions mean more warming, more extremes, and ultimately higher societal costs in the decades ahead. With global temperatures on a trajectory to breach critical thresholds soon, the policy's long-term consequences—from American assembly lines to drought-stricken farms and flood-ravaged coasts—will be felt for generations.
