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President Donald Trump on Wednesday rescinded Biden-era Corporate Average Fuel Economy standards, arguing the regulations drove up car prices and imposed unrealistic targets on auto manufacturers.
Speaking from the Oval Office alongside Transportation Secretary Sean Duffy, Republican lawmakers, and auto industry executives, President Trump said his administration was “officially terminating Joe Biden’s ridiculously burdensome” CAFE rules.
“They imposed expensive restrictions and all sorts of problems to auto makers,” the president said. “It put tremendous upward pressure on car prices… Biden’s burdensome regulations helped cause the price of cars to soar more than 25 percent, and in one case, they went up 18 percent in one year.”
The move reverses fuel-efficiency requirements introduced under former Transportation Secretary Pete Buttigieg. In 2022, the Biden administration ordered an eight percent increase in fuel efficiency for 2024-2025 passenger vehicles, followed by a 10 percent increase in 2026. A 2024 rule called for additional annual increases through 2031.
The White House fact sheet said the earlier regulations “broke the law by going far beyond the requirements mandated by Congress” when it established the CAFE program. The administration said the reset would realign the standards with congressional intent.
Duffy defended the rollback, calling the previous rules “completely unattainable” and blaming them for higher consumer costs. He said manufacturers were forced to spend heavily on technology to meet the standards or purchase carbon credits when they could not, both of which increased sticker prices.
Executives from major automakers praised the decision. Ford CEO Jim Farley said the administration was delivering “a victory on common sense and affordability.” Stellantis CEO Antonio Filosa said the revised standards “reconcile with real customers’ demands.”
The White House fact sheet added that, “Today’s action helps ensure that even if far-left Democrats return to power, the CAFE standards are sensible, so U.S. automakers are not held to infeasible standards.”
It continued, “Combined with auto loan interest deductibility for new made-in-the-USA vehicles, President Trump continues to deliver real relief that makes owning a safe, reliable car more affordable for every American family.”