The Biden administration has put forth a proposal for new fuel economy standards aiming to save Americans money at the gas pump while also acknowledging that car prices may increase.

These new Corporate Average Fuel Economy (CAFE) standards, introduced by the National Highway Traffic Safety Administration (NHTSA), call for a 2% and 4% improvement in fuel efficiency for passenger cars and light trucks, respectively, starting in 2027.

From 2030 onwards, pickup trucks and work vans will need to achieve a 10% boost in fuel efficiency every year. By 2032, the average U.S. fleet fuel economy could potentially reach 58 miles per gallon.

The Environmental Protection Agency (EPA) informs us that the estimated average fuel economy for model year 2022 cars was 26.4 miles per gallon. This means that if the proposed standards are adopted, automakers will be required to more than double fuel efficiency within a decade or else face significant penalties.

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