Trump Just Slashed Fuel Economy Standards And … Legalized Kei Cars?
President Trump announced a sweeping overhaul of U.S. fuel economy regulations at the White House on Wednesday that rolls back Biden-era goals.
The target for the Corporate Average Fuel Economy (CAFE) for 2031 is now 34.5 mpg, down from 50.4 mpg. The CAFE figure is an unadjusted number and roughly 33% higher than what is displayed on a vehicle’s window sticker. The rules do not factor in electric vehicles and the practice of buying carbon credits to meet the standard is no longer allowed.
The retroactive MPG targets for passenger cars will increase .5 annually from 2023 to 2026, .35% in 2017 and .25% annually from 2029 to 2031. Many SUVs will be reclassified as passenger cars and trucks will have a slightly different efficiency improvement schedule.
Fines for not meeting CAFE targets were eliminated by Congress in July and the new proposal puts automakers on the honor system, noting that they all have corporate policies stating that they will comply with all regulations.
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“[The National Highway Traffic Safety Administration] thus believes that it is reasonable to assume in its analysis of maximum feasibility that manufacturers will make the maximum practicable effort to comply with the applicable standards,” the proposal says.
Ford CEO Jim Farley was at the president’s side for the announcement and said the new policy is “a victory for common sense and affordability.”
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The Department of Transportation estimates that the new rules will reduce the price of new vehicles by an average of $1,000, but Trump said it could be much more.
In an unexpected move, Trump also announced that he has directed the Department of Transportation to legalize Asian-style kei cars in the U.S. The microcompact cars are popular in Japan, South Korea and other countries in the region, but don’t meet current U.S. safety standards. They are limited to small engines of no more than 660cc capacity, but are offered in a variety of car, SUV and pickup body styles at starting prices below $10,000. Trump said he discovered them on his recent trip to Asia.
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“They have a very small car sort of like the beetle used to be with the Volkswagen, Trump said. “They’re very small, they’re really cute and I said ‘how would that do in this country?’ And everyone seems to think good, but you’re not allowed to build them, and I’ve authorized the [Transportation] secretary to immediately approve the production of those cars.”
“We have cleared the deck so they can make them in America and sell them in America,” Transportation Secretary Sean Duffy said. Full details on the regulations have not been released and the Department of Transportation has not yet responded to a request for more information from American Cars And Racing.
The CAFE proposal is subject to a 45-day public comment period before it is formally filed as a rule in the federal register.
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