The National Highway Traffic Safety Administration (NHTSA) has finalized a rule revising Corporate Average Fuel Economy (CAFE) standards for passenger cars and light trucks for model years 2022 to 2031. The standards set fuel economy targets that automakers must meet across their overall vehicle lineups.

What's Changing?

• Fleet target: NHTSA estimates the new standards would achieve a fleet average of 34.9 mpg by model year 2031, compared with 30.1 mpg for model year 2024.
• Vehicle classification: Beginning in model year 2030, vehicles will be classified by their intended use. NHTSA says this will shift the current mix of roughly 70% light trucks and 30% passenger cars to roughly the reverse.
• Credit trading: The CAFE credit trading program, which lets automakers buy and sell compliance credits, will be eliminated beginning in model year 2028.

NHTSA estimates the rule would lower the average cost of a new vehicle by about $1,300 and reduce projected annual oil consumption in 2050 by roughly 1.3 billion barrels compared with 2024. Environmental groups, including the Natural Resources Defense Council (NRDC), have criticized the rule, arguing it weakens fuel economy requirements and will raise fuel costs.

NRDC cites a NHTSA proposal estimate of about $1,400 in additional lifetime fuel costs for the average driver, and has said it believes the rule violates the law.

What Could This Mean For Small Business Fleets?

The rule's real-world impact will depend on how automakers respond, but here are a few things fleet owners may want to keep in mind.

• Purchase price vs. operating cost: The two estimates above measure different things, one upfront cost and the other fuel spending over a vehicle's life. For a fleet, the net effect depends on how many miles each vehicle drives and what fuel costs. High-mileage vehicles are more sensitive to fuel economy.
• Timing: Changes phase in by model year, so near-term purchases are unlikely to look very different. Classification changes don't begin until model year 2030, and credit trading ends in 2028.
• Vehicle availability: NHTSA says the classification change could encourage more small cars, hatchbacks, and wagons. How automakers respond, including for pickups, vans, and crossovers commonly used by small businesses, remains to be seen.
• Scope: The rule covers passenger cars and light trucks. Heavier commercial vehicles are regulated under separate programs.
• Possible legal challenges: NRDC has signaled it may contest the rule, so the final outcome could still change.

Fleet owners may want to:

• Run total cost of ownership comparisons that include fuel, not just sticker price
• Test fuel price scenarios (for example, what a $1 swing per gallon does to annual costs)
• Track fuel use per vehicle to see where efficiency matters most

The final rule is available on NHTSA's website.