President Donald Trump announced Wednesday that his administration is resetting Biden-era Corporate Average Fuel Economy (CAFE) standards that increased car prices.
Trump and Transportation Secretary Sean Duffy announced the reset in the Oval Office while flanked by Republican lawmakers and auto industry leaders.
“We’re officially terminating Joe Biden’s ridiculously burdensome, horrible, actually, CAFE standards that impose expensive restrictions and all sorts of problems to auto makers,” Trump said.
The president noted that the CAFE standards imposed by the previous administration impacted both domestic and foreign manufacturers making cars for the American market and, in turn, consumers.
“And we’re not only talking about here, we’re talking about outside of our country, because nobody could do it. Nobody wanted to do it, and it was ridiculous, very expensive,” he said.
“It put tremendous upward pressure on car prices, combined with the insane electric vehicle mandate. 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,” he added.
In April 2022, the Biden Department of Transportation under then-Secretary Pete Buttigieg announced a rule to increase fuel efficiency by eight percent for 2024-2025 model year passenger cars and light trucks, and another ten percent for 2026 models.
In June 2024, the DOT announced a rule to increase fuel economy by two percent annually on 2027-2031 model passenger cars, and two percent per year on 2029-2031 model light trucks.
In a fact sheet, the Trump administration states that Buttigieg and the Biden administration “broke the law by going far beyond the requirements that were mandated by Congress when it created the CAFE program.”
Wednesday’s reset will ensure that CAFE Standards abide by the standards set forth by Congress, it adds.
Duffy said the actions the administration is taking are a prime example of how Democrats’ rhetoric on “affordability is a lie.”
Biden and Buttigieg…used EVs and hybrids to come up with a 62 mile-an-hour per gallon standard, which the car companies will tell you, is completely unattainable. So they spent a lot of money on technology trying to meet the unattainable standard, driving up the cost of a car, number one, and then number two, if they couldn’t meet the unattainable standard, they had to trade for carbon, costing billions of dollars, and again, driving up the price of the cars.
He added that Democrats “were not making cars more affordable, they were making them less affordable.”
Duffy said that new cars will be more accessible to Americans because of the reset, and a byproduct of that will be better safety, thanks to the latest technology in cars. He also touted that this is a major win for the free market.
“These rules are going to allow the automakers to make vehicles that Americans want to purchase, not vehicles that Joe Biden and Buttigieg want them to build, which is important,” Duffy detailed.
“But also, this is important for American jobs. The more cars we sell, the more jobs we have in this country, and so this is jobs, this is freedom, and this is common sense,” the secretary added.
Ford CEO Jim Farley said that the Trump administration is delivering “a victory on common sense and affordability.”
Stellantis CEO Antonio Filosa said that CAFE standards will now meet customer demands.
“It’s a great day for us at Stellantis today because it’s a day where we see CAFE regulations reconcile with real customers’ demands,” he said.
In his first term, Trump rolled back the Obama-era gas mileage standard.
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