The US Transportation Department finalized sharply lower vehicle fuel economy standards through 2031, cutting the fleetwide average to 34.5 mpg from 50.4 mpg under the previous administration. This reversal of Biden-era rules aims to reduce new vehicle costs by about $930 per car but is expected to increase fuel consumption by 100 billion gallons and CO2 emissions by 5% through 2050. The move weakens incentives for EV adoption and hands clean tech leadership to China. Automakers will face less pressure to produce efficient vehicles, while consumers will see higher fuel costs over the long run. The decision comes amid high fuel prices due to the Iran conflict, but the long-term environmental and economic trade-offs are significant.
