The Trump administration says new regulations will lower new car costs in the US. In December, a plan to lower fuel economy requirements to 34.5 mpg was proposed. Ford boss Jim Farley praised President Trump for rolling back regulations last year. Well before President Trump returned to the Oval Office for his second term, he had promised significant changes to fuel economy standards. While President Trump has broken many of his pre-campaign promises, he has stuck with this one, confirming that he has just approved the new regulations. Writing on social media over the weekend, President Trump declared the changes will reduce new car prices. Predictably, he didn’t say by how much prices could fall, although any significant change will no doubt be appreciated by car buyers. However, the changes will inevitably hamper the growth of electric vehicles in the United States and trigger increases in carbon dioxide emissions. Read: Trump’s MPG Rollback Could Cut $930 From A New Car, But You Might Never See It Biden administration policies had required car companies to improve the fuel efficiency of their vehicles by 8 percent through 2024 and 2025, then by 10 percent in 2026, and an additional 2 percent each year from 2027 to 2031. The Trump administration has been working on finalizing new fuel economy standards for almost a year. In December, it pitched a plan to cut fuel economy requirements to 34.5 mpg by 2031, far below the 50.4 mpg target set by President Biden. Important industry leaders, including Ford chief executive Jim Farley, immediately welcomed the news. Earlier this month, the NHTSA said the proposal could cut $980 from the price of each average new car. A Big Win For Americans? Writing on Truth Social, President Trump declared it a “BIG DAY FOR AMERICAN AUTO WORKERS AND CAR BUYERS!,” claiming that “These new Standards will take the waste out of building cars in America. That means LOWER PRICES, saving families thousands on a new, beautiful, and safe car – Far better than the Environmental Monsters that we were building heretofore.” In the same post, Trump claimed, “The Dumocrats cost our Great Auto Manufacturers $Billions, forced Americans into cars they never wanted, and wasted Billions on Chargers that were never built.” The administration will announce in-depth details about its new fuel economy standards on Monday. While the Trump administration is promising the change will make new cars cheaper, there’s no guarantee that’ll be the case. While it’s possible these changes will lower manufacturing costs, as they’ll enable companies to develop and produce simpler and cheaper powertrains, there’s no guarantee any of these savings will be passed on to consumers. After all, American brands like Ford and GM are publicly traded companies focused on maximizing shareholder value, not necessarily making their vehicles affordable. It’s also unclear how long these new fuel economy standards could stick around. We’re in the midst of an incredibly divisive political period, and if the Democrats regain power in the 2028 election, or even the 2032 election, any changes made under Trump could be quickly reversed.
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