US Lowers Fleet Fuel Economy Standards to 35 MPG Target by 2031

The U.S. Department of Transportation has released updated Corporate Average Fuel Economy rules that significantly reduce national vehicle efficiency targets, establishing a fleet target of 34.9 miles per gallon for model year 2031 vehicles. The regulatory change represents a substantial rollback from earlier benchmarks, according to a report by Ars Technica (https://arstechnica.com/cars/2026/09/trump-cuts-fuel-economy-standards-back-to-2014-levels/).

The announcement formalizes a policy shift signaled by Transportation Secretary Sean Duffy upon taking office in January. Duffy declared at the time that fuel economy frameworks established under the Biden administration—which imposed stricter mileage thresholds intended to drive production of battery-electric and plug-in hybrid vehicles—would be discarded.

Among the changes in the final rule is the phaseout of regulatory emissions credits. Starting in model year 2028, the Department of Transportation will eliminate the credit system. Regulators argued in the notice of final rulemaking that relying on emissions credits discouraged automakers from investing directly in cleaner internal combustion engine technology.

The updated framework also excludes plug-in hybrid and fully electric models from an automaker's overall fleet average calculations. Under previous regulations, zero-emission vehicles could carry fuel economy ratings in the hundreds of miles per gallon, helping manufacturers meet overall fleet thresholds. The regulatory change follows an announcement by the Transportation Department last July stating it would not fine automakers for exceeding CAFE limits dating back to 2022.

The rule also revises vehicle classification criteria to tighten the light truck category. Automakers previously reclassified crossover models as light trucks to qualify for more lenient efficiency targets. Subject to remaining in effect, the new guidelines will change classification criteria starting in model year 2030 to reflect intended vehicle use, aiming to shift current fleet composition from approximately 70 percent light trucks and 30 percent passenger vehicles to around 70 percent passenger cars and 30 percent light trucks.

The 34.9 mpg target retreats significantly from historical regulatory targets. In 2012, the Obama administration published CAFE standards designed to reach 54 mpg by 2025. In 2020, the first Trump administration reduced those benchmarks from 46.7 mpg in model year 2026 to 40.4 mpg before the Biden administration later raised efficiency targets.

"The CAFE program was created in the 1970s in response to price shocks at the pump that raised costs for every American. Lowering these standards now, when so many families are already struggling with rising transportation costs, will only make things harder for them. At the same time, lowering the bar for innovation risks a future where the global auto market leaves American industry behind," said Albert Gore, executive director of the Zero Emissions Transportation Association.