Trump’s auto rule reset puts mileage standards in focus

Federal mileage rules change for 2031

The National Highway Traffic Safety Administration finalized new Corporate Average Fuel Economy standards for passenger cars and light trucks on September 28, 2026. The federal requirements cover model years through 2031 and change how quickly automakers must improve fuel economy across their fleets.

The rules are part of the Trump administration’s broader changes to federal vehicle policy, including earlier changes to tailpipe emissions requirements. CAFE standards have regulated the average fuel economy of new vehicle fleets since the energy crisis of the 1970s.

Automakers get a slower path to 2031

Automakers face smaller annual CAFE increases under the new federal standards through model year 2031. Passenger car stringency rises 0.90% annually through model year 2029, while light truck stringency rises 0.51%, followed by a 1% increase for both from model year 2030 to 2031.

The previous 2024 rule called for 2% annual increases for passenger cars from 2027 through 2031 and for light trucks from 2029 through 2031. CAFE requirements use fleet averages and vehicle footprint targets rather than one mileage requirement for every model.

CAFE rules date back about 50 years

Congress established the CAFE program in 1975 following the energy crisis of the 1970s. The passenger car standard began at 18 mpg for model year 1978 and increased to 27.5 mpg by model year 1985.

Average light-duty vehicle fuel economy was about 13.1 mpg in model year 1975, which was separate from the federal CAFE requirement. Average vehicle fuel economy increased substantially during the early years of the program as federal standards became more stringent.

Trump reverses several EV policies

Federal policy has changed in several ways that reduce incentives for EV adoption and higher vehicle efficiency. EPA repealed federal motor vehicle greenhouse gas standards in February 2026, while federal law set CAFE civil penalties at $0 and ended the new clean vehicle credit for vehicles acquired after September 30, 2025.

Former President Joe Biden’s 2021 executive order set a goal for electric vehicles to represent 50% of new passenger vehicle and light truck sales in 2030. The order described the 50% figure as a federal policy goal rather than a mandatory sales quota.

Oil savings differ from earlier rules

DOT projects that, under the new rule, annual U.S. oil consumption in 2050 will be about 1.3 billion barrels lower than in 2024. However, compared with the 2024 standards, the 2026 rule is projected to increase U.S. gasoline consumption by 4.6% through 2050.

NHTSA estimated its 2024 model-year 2027–2031 standards would bring the average light-duty vehicle fuel economy target to about 50.4 mpg by model year 2031 and save passenger car and light truck owners more than $600 in fuel over the lifetime of their vehicles. The 2026 rule lowers the projected 2031 fleetwide target to about 34.9 mpg.

Ford, GM and Stellantis support the rule

Ford, General Motors, and Stellantis welcomed the revised fuel economy standards, saying the changes better reflect current market conditions and customer demand. Ford said it would evaluate the final rule’s full effect while continuing to work with the administration on the U.S. auto industry.

General Motors said it supports the rule’s goals and its effort to align fuel economy standards with market realities. Stellantis welcomed the revised targets, while the Alliance for Automotive Innovation called the finalized standards an appropriate course correction.

EVs were 5.7% of August sales

Electric vehicles accounted for 5.7% of total U.S. new-vehicle sales in August 2026. That share was below the 7.8% recorded across all of 2025, providing context for automakers’ statements about current consumer demand.

Federal clean vehicle tax credits ended for vehicles acquired after September 30, 2025, and the EPA repealed federal motor vehicle greenhouse gas standards in February 2026. Those policy changes added pressure to an EV market that was already adjusting after a strong tax-credit-driven sales period.

Hybrids reached 19% of August sales

Hybrid vehicles accounted for 19% of U.S. retail vehicle sales in August 2026 as demand for fuel-efficient models increased. Toyota and Honda benefited from broad hybrid lineups, while General Motors had relatively few hybrid options in the U.S. market.

General Motors remained the top-selling U.S. automaker in the third quarter with 670,974 vehicles, while Toyota sold 633,223 and narrowed the gap. Toyota’s Corolla hybrid sales increased 36% during the quarter as hybrid demand continued to support the company’s U.S. sales.

Detroit Three share fell near 36%

The Detroit Three’s combined U.S. market share fell to around 36% in the third quarter of 2026, near the record low forecast by Cox Automotive. Cox had projected Ford sales to decline 8.8% and General Motors sales to decline 6.2% through the first 3 quarters.

General Motors later reported 670,974 third-quarter U.S. sales, down 5.5% from a year earlier. Cox said Ford and GM were experiencing the two steepest market-share declines among the 13 automakers included in its September forecast.

U.S. vehicle share falls in Canada

The share of U.S.-built vehicles in Canadian new-vehicle sales fell from 35.4% in the first half of 2025 to 28.4% in the first half of 2026. U.S.-built vehicles had accounted for roughly 40% of the Canadian new-vehicle market from about 2021 through the first quarter of 2025.

Canada maintains 25% counter-tariffs on certain U.S.-made vehicles, which took effect in April 2025. President Trump has threatened to raise tariffs on Canadian autos and auto parts to 50% starting January 1, 2027.

Pollution estimates also changed

NHTSA’s 2024 CAFE rule estimated that the selected standards would cut vehicle-related emissions and reduce gasoline use compared with its reference baseline. EPA has also reported that transportation is the largest source of U.S. greenhouse gas emissions.

The 2026 rule changes that policy path by setting lower CAFE targets for model years through 2031. That means fuel use, emissions, and consumer fuel costs are now projected differently than they were under the 2024 standards.

BYD’s new tech brings EV charging close to gas-station speed, underscoring why EV technology is now tied to broader questions about supply chains and national security.

The rule changes more than mileage

The final rule covers passenger cars and light trucks from model years 2022 through 2031 and changes several CAFE compliance provisions. NHTSA will end intermanufacturer credit trading for credits earned beginning in model year 2028 and change vehicle classification criteria beginning in model year 2030.

DOT expects the classification changes to shift the regulated fleet from about 70% light trucks and 30% passenger cars to roughly the reverse. The department projects the combined fleetwide fuel economy will rise from 30.1 mpg in model year 2024 to 34.9 mpg by model year 2031.

China’s car tech surge puts global drivers on notice, showing why the U.S. is racing to build a stronger rare-earth supply chain.

Fuel economy rules can affect both vehicle prices and how much drivers spend on gasoline. Follow CAFE changes, gas prices, and new car costs as the updated standards take effect.

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This slideshow was made with AI assistance and human editing.