Trump announces rollback of Biden-era fuel economy standards, says move will save families $109 billion

WASHINGTON — President Donald Trump announced Wednesday a major rollback of stringent Biden-era fuel economy standards, saying the move would lower vehicle prices and save American families a total of $109 billion.

Flanked in the Oval Office by the CEOs of Ford and Stellantis and a senior General Motors official, Trump signed an executive action directing the National Highway Traffic Safety Administration to reset Corporate Average Fuel Economy (CAFE) requirements to less aggressive levels.

“We’re officially terminating Joe Biden’s ridiculously burdensome CAFE standards,” Trump said. He argued the Biden rules, which required roughly 8-10% annual increases in fleet-wide fuel efficiency for model years 2024-2026, drove up new-car prices by more than 25% in recent years and effectively forced consumers toward electric vehicles.

The White House said the revised standards will reduce the average price of a new vehicle by nearly $1,000 compared with keeping the Biden rules in place.

Ford CEO Jim Farley praised the move, saying it “aligns fuel economy standards with market realities” and allows progress on emissions “while still giving customers choice and affordability.”

Stellantis CEO Carlos Tavares called the reset part of a “wider vision for a growing U.S. automotive industry growth” that preserves consumer freedom. General Motors issued a statement supporting a single national standard that “upholds customer choice and provides the auto industry long-term stability.”

The Biden administration had significantly tightened CAFE rules that Trump loosened during his first term. The Obama administration originally set the standards, and Trump’s 2020 rule required only 1.5% annual improvements through model year 2026.

Trump has made undoing Biden-era environmental and electric-vehicle policies a priority since returning to office. In June, he signed legislation nullifying California’s 2035 ban on new gasoline-powered vehicle sales, and a sweeping July reconciliation bill eliminated civil penalties for CAFE violations.

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