However, critics argue that these standards will also drive up car prices. The Department of Transportation's National Highway Traffic Safety Administration (NHTSA) unveiled the new Corporate Average Fuel Economy (CAFE) standards on Friday.
The rules require passenger cars and light trucks to improve fuel efficiency by 2% and 4%, respectively, starting in 2027. Pickup trucks and work vans, on the other hand, must boost fuel efficiency by 10% every year beginning in 2030.
According to the NHTSA, by 2032, the average U.S. fleet fuel economy could reach 58 miles per gallon. This is a significant increase from the estimated average fuel economy of 26.4 miles per gallon for model year 2022 cars. Automakers will be required to more than double fuel efficiency in less than a decade or face substantial penalties.
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Transportation Secretary Pete Buttigieg believes that better vehicle fuel efficiency will put more money in Americans' pockets and strengthen energy security for the entire nation. The DOT and NHTSA claim that if the new CAFE standards are finalized, consumers could save over $50 billion on fuel over the lifetime of their vehicles.
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Additionally, these standards would reduce oil dependence by cutting gasoline consumption by 88 billion gallons through 2050. The administration also argues that the standards would curb carbon emissions by more than 900 million tons, which is equivalent to taking over 233 million vehicles off the road by 2050.
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NHTSA Acting Administrator Ann Carlson believes that CAFE standards have driven the auto industry to innovate and improve fuel economy, benefiting the nation and all Americans. She sees the proposed standards as a way to advance energy security, reduce harmful emissions, and save families and business owners money at the pump.
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However, the proposal is expected to face significant opposition from Republican lawmakers, the fossil fuel industry, and automakers. General Motors Vice President of Global Regulatory Affairs, David Strickland, has already presented data to White House officials, suggesting that the CAFE standards could cost companies up to $300 billion in government fines for not meeting fuel efficiency requirements.
This proposal comes after the EPA's recent proposal for aggressive tailpipe emissions standards, which aims to have 67% of new sedan, crossover, SUV, and light truck purchases be electric by 2032. The NHTSA states that its rules will complement and align with the EPA's emissions standards, and it invites comments from all stakeholders on how to achieve the goal of optimizing effectiveness while minimizing compliance costs.
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Republican Senator Ted Cruz has been a vocal critic of the EPA's emissions standards and warns against NHTSA following suit. He believes that the proposed fuel economy standards will be a de facto electric vehicle mandate if finalized. Cruz argues that this will raise car prices, weaken energy security, and potentially go against the law. He has been fighting against what he sees as economically destructive regulatory overreach.
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It is worth noting that NHTSA Acting Administrator Ann Carlson faced strong opposition from Cruz and other lawmakers, leading to the withdrawal of her nomination to lead the agency. Despite this, Carlson remains the acting administrator and effectively leads the NHTSA.
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The proposed fuel economy standards have the potential to significantly impact the auto industry, consumers, and the environment. While the Biden administration argues that these standards will save Americans money and reduce carbon emissions, critics are concerned about the potential costs and limitations on vehicle choice. As the proposal moves forward, it is likely to face intense scrutiny and debate from various stakeholders.
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