Business & Economics
Trump Administration Moves to Cut 2031 CAFE Target to 34.5 MPG and End Credit-Trading
On 4 Dec 2025 the U.S. Transportation Department, at President Trump’s direction, issued a proposal to lower the 2031 fleet-wide fuel-economy goal from roughly 50 MPG to 34.5 MPG and to scrap emissions-credit trading after 2027, reversing Biden-era rules.
Focusing Facts
- Proposal released 4 Dec 2025 would require only 34.5 MPG on average by model-year 2031, versus the 50.4 MPG target finalized in June 2024.
- Draft rule abolishes inter-manufacturer credit trading starting 2028 and, under July’s One Big Beautiful Act, automakers face zero CAFE fines retroactive to 2022.
- NHTSA projects the rollback will raise U.S. fuel use by ~100 billion gallons and consumer fuel outlays by up to $185 billion through 2050.
Context
Washington has repeatedly seesawed on CAFE: Reagan’s DOT froze standards in 1986; Congress pushed them to 35 MPG by 2020 in the 2007 Energy Independence and Security Act; Trump’s first term (2018-20) cut Obama’s targets before Biden restored them in 2024. The 2025 rollback reprises that tug-of-war, revealing deeper structural forces: 1) a century-long dependence on petroleum infrastructure that resists rapid electrification; 2) regulatory uncertainty that automakers exploit to delay costly transitions; 3) partisan swings that make long-horizon investments (batteries, supply chains) risky for both Detroit and Silicon Valley EV firms. Like the 1970s oil-shock CAFE birth or California’s 2004 ZEV mandate, today’s decision tests whether federal rules can steer technology or merely chase voter sentiment and fuel prices. On a 100-year arc, the proposal may prove a historical footnote if global battery costs keep falling—much as early-20th-century horse-carriage tariffs could not stem the rise of the Model T—yet it underscores how U.S. climate policy remains contingent on four-year electoral cycles rather than durable consensus.
Perspectives
Right-leaning, pro-business US media
e.g., ArcaMax, Financial Express, Newser — Portrays Trump’s rollback as a commonsense win that will cut car prices by about $1,000, save families more than $100 billion and free automakers to build the gasoline vehicles shoppers prefer. Echoes White House and Detroit-executive talking points while skimming over estimates of higher lifetime fuel costs and emissions, reflecting ideological and commercial incentives to champion deregulation.
Mainstream outlets amplifying environmental and climate advocates
e.g., BBC, CBS News, Devdiscourse — Emphasises that weakening CAFE standards will boost oil use by up to 100 billion gallons, add hundreds of dollars in fuel costs per driver and stall US climate progress. Leans on quotes from Sierra Club, NRDC and state officials to stress environmental danger, potentially understating short-term compliance costs that concern automakers.
Asian mainstream press focused on industrial competitiveness
e.g., South Korea’s Chosun.com — Frames the decision as a retreat from Biden-era climate policy that shields GM and Stellantis but could disadvantage EV-heavy players like Toyota and Tesla while injecting uncertainty into the global auto market. Highlights climate back-pedalling and market disruption—angles resonant with export-oriented Asian manufacturers—while giving little weight to US voter concerns about vehicle affordability.