Trump's Law Shields Automakers from Fuel Economy Fines

U.S. automakers will not face fines for not complying with Corporate Average Fuel Economy (CAFE) standards dating back to 2022, owing to a new law signed by President Donald Trump. This decision was revealed by U.S. regulators, highlighting a significant shift in fuel economy policy.

The recent law, part of a broader tax and budget bill, effectively nullifies penalties previously mandated under a 1975 energy regulation for failing to meet fuel efficiency benchmarks. This move demonstrates a significant policy redirection under Trump's administration.

The National Highway Traffic Safety Administration (NHTSA) conveyed in a letter seen by Reuters that it is revisiting existing fuel economy standards. The new regulatory environment is anticipated to facilitate increased production of gas-powered vehicles by automakers.

(With inputs from agencies.)