National Highway Traffic Safety Administration (NHTSA)

Rule Increasing Penalties for Violations of Fuel Economy Standards

The National Highway Traffic Safety Administration (NHTSA) is charged with enforcing the Corporate Average Fuel Economy (CAFE) standards that it promulgates, and can impose penalties at amounts set by the agency through rulemaking. See 49 U.S.C. 32911–32912. These penalties have been the 

Biden Administration (2021-2025)

Revised Rule on Civil Penalties

On April 1, 2022, NHTSA finalized its withdrawal of the Trump Administration’s January 2021 interim rule and reverted to the agency’s prior rule that had been completed in 2016. (87 Fed. Reg. 18994, Apr. 1, 2022). The final rule reinstated the 2016 penalties beginning with model year 2019 vehicles, concluding among other things that the industry was aware of NHTSA’s penalty plans since 2016, and that the industry was aware of (and in fact driving) much of the litigation since that time that resulted in temporary changes to NHTSA’s direction.

Executive Order on Protecting Public Health and the Environment and Restoring Science to Tackle the Climate Crisis

On January 20, 2021, the President issued Executive Order 13990 (Protecting Public Health and the Environment and Restoring Science to Tackle the Climate Crisis). E.O. 13990 directed the heads of all agencies to immediately review all existing regulations, orders, guidance documents, policies, and any other similar agency actions promulgated, issued, or adopted between January 20, 2017 and January 20, 2021, that are or may be inconsistent with, or present obstacles to, the policy set forth in EO 13990.

Trump Administration (2017-2021)

Interim Rule Delaying Court-Ordered Penalty Increases

Immediately after the Second Circuit’s decision to vacate the 2019 regulation freezing penalty increases and revert back to the 2016 rule (see New York v. National Highway Traffic Safety Administration (2019) in “Litigation” below), NHTSA received an industry petition arguing that model years 2019 and 2020 were largely all already produced, making compliance impossible. (See 86 Fed. Reg. 3016, 3020–21, Jan. 14, 2021). NHTSA granted the petition, publishing on January 14, 2021 an interim rule delaying the increase in civil penalties for failing to meet fuel efficiency standards until 2022. (86 Fed. Reg. 3016, Jan. 14, 2021).

This interim final rule was subject to litigation. (See NRDC v. National Highway Traffic Safety Administration (2021) in “Litigation” below).

Regulation Freezing Penalty Increases

On July 26, 2019, NHTSA issued a final regulation freezing the then- current civil penalty rate at $5.50 per .1 of a mile per gallon, rather than increasing it to $14 beginning in model year 2019. (84 Fed. Reg. 36007, July 26, 2019).

This regulation was subject to litigation. (See New York v. National Highway Traffic Safety Administration (2019) in “Litigation” below).

Indefinite Delay of Penalty Increases

On July 12, 2017, days before the 2016 rule was set to take effect, NHTSA announced that it would indefinitely delay the effective date of the agency’s 2016 rule. (82 Fed. Reg. 32139, July 12, 2017). NHTSA noted that it was “reconsidering the final rule because the final rule did not give adequate consideration to all of the relevant issues, including the potential economic consequences of increasing CAFE penalties by potentially $1 billion per year.” In a separate but simultaneous notice, NHTSA announced that it would reconsider and potentially revise the 2016 rule. (82 Fed. Reg. 32140, July 12, 2017).

This indefinite delay was subject to litigation. (See NRDC v. National Highway Traffic Safety Administration (2017) in “Litigation” below).

Obama Administration (2009-2017)

Regulation Increasing Penalties for Manufacturers in Violation of Fuel Standards

On December 28, 2016, NHTSA published a final rule increasing penalties for automobile manufacturers that fail to meet fuel economy standards. (81 Fed. Reg. 95489, Dec. 28, 2016). The rule increased the fines from $5.50 to $14 per tenth-of-an-mpg for model years 2019 and onward, and allowed for additional adjustments for inflation between the publication date and the assessment of the violation. The rule was set to take effect on July 10, 2017. 

Litigation

NRDC v. National Highway Traffic Safety Administration (2021)

On January 25, 2021, the Sierra Club and the Natural Resources Defense Council (NRDC) brought a lawsuit in the Second Circuit Court of Appeals challenging the Trump Administration’s 2021 interim final rule that delayed a 2016 inflation adjustment to the civil penalty for violations of Corporate Average Fuel Economy standards until model year 2022. On June 17, 2022, this lawsuit was voluntarily dismissed following the Biden Administration’s withdrawal of the challenged rule.

New York v. National Highway Traffic Safety Administration (2019)

In August of 2019, twelve states, the District of Columbia, and two environmental groups filed petitions for review in the Second Circuit Court of Appeals challenging NHTSA’s decision to reverse an inflation adjustment to the civil penalty for violations of CAFE standards. On August 31, 2020, the Second Circuit Court of Appeals vacated NHTSA's rule freezing civil penalties and reinstated the 2016 rule increasing the penalty rate to $14 beginning with model year 2019 vehicles. 

NRDC v. National Highway Traffic Safety Administration (2017)

In September of 2017, two petitions for review were filed in the Second Circuit Court of Appeals seeking to set aside NHTSA’s decision to indefinitely delay the effective date of a final rule increasing the civil penalty rate for violations of CAFE standards. Petitioners in one proceeding were the Natural Resources Defense Council and two other environmental groups. Petitioners in the other proceeding were the State of New York and four other states. On April 23, 2018, the court issued a one-page order vacating the agencies’ decision to indefinitely delay the rule. 

Corporate Average Fuel Economy Standards

The National Highway Traffic Safety Administration (“NHTSA”) is required to establish corporate average fuel economy (“CAFE”) standards for passenger cars and light-duty trucks at the “maximum feasible average fuel economy level.” 49 U.S.C. 32902. The standards NHTSA  promulgates apply by model years of vehicles and are based on the agency’s consideration of “technological feasibility, economic practicability, the effect of other motor vehicle standards of the Government on fuel economy, and the need of the United States to conserve energy.” Id. at § 32902(f).

On January 28, 2025, the Secretary of Transportation released a memorandum directing NHTSA to immediately review and reconsider all CAFE standards to align them with President Trump’s policy priorities.

Second Trump Administration (2025-2028)

On January 28, 2025, the Secretary of Transportation released a memorandum directing NHTSA to immediately review and reconsider all CAFE standards to align them with President Trump’s policy priorities.

Biden Administration (2021-2024)

Standards for Passenger Cars and Light Trucks, Model Years 2027-2031

On June 24, 2024, NHTSA finalized CAFE standards for model year 2027-2031 passenger cars and light trucks, and simultaneously finalized fuel efficiency standards for model year 2030-2035 heavy-duty pickup trucks and vans. (89 Fed. Reg. 52540, June 24, 2024). The standards dictate fuel economy increases of 0–2% per year for passenger cars and light-duty trucks in various model years covered, as well as increases of 8–10% (depending on model year) for heavy-duty pickup trucks and vans. 

Revised Light-Duty Vehicle Greenhouse Gas Emissions Standards for Model Years 2023 and Later

On December 30, 2021, NHTSA issued a final rule revising the Trump Administration’s “SAFE” rule standards applicable to model years 2023 and later. (86 Fed. Reg. 74434, Dec. 30, 2021). These rules largely restored the Obama Administration’s standards between model years 2023 and 2026. Accounting for the significant deployment of “zero-emission” electric vehicles, the Biden Administration then set the most stringent motor vehicle GHG emission standards ever by lowering the emissions standard by more than 10% between model years 2025 and 2026.

This regulation was subject to litigation, in which the Sabin Center filed an amicus brief. For more information about the Sabin Center’s participation in litigation around this rule, read the Sabin Center’s blog post on the issue here.

Repeal of Trump Administration’s SAFE Rule’s Preemption Provisions

On December 29, 2021, NHTSA issued a final rule entitled “Corporate Average Fuel Economy (CAFE) Preemption,” which repealed the SAFE Rule’s purported preemption of state and local laws related to fuel economy standards. (86 Fed. Reg. 74236, Dec. 29, 2021). As NHTSA explained in its notice of proposed rulemaking announcing the proposed repeal, the agency was concerned that the agency lacked the authority to expand Congress’s self-executing preemption clause through regulation. (86 Fed. Reg. 25980, May 12, 2021). 

First Trump Administration (2017-2020)

The Safer Affordable Fuel-Efficient (SAFE) Vehicles Rule for Model Years 2021-2026 Passenger Cars and Light Trucks

On April 30, 2020, the Environmental Protection Agency (“EPA”) and NHTSA jointly issued a final rule in which NHTSA amended fuel economy standards for model year 2021-2026 passenger cars and light trucks. (85 Fed. Reg. 24174, Apr. 30, 2020). This final rule required each automobile manufacturer to reduce the average emissions from its vehicle fleet by approximately 1.5% per year, down from an average reduction of 5% per year under the Obama Administration’s rules.

Preemption of State Fuel Efficiency Programs

On September 27, 2019, EPA and NHTSA jointly issued the “Safer Affordable Fuel-Efficient (SAFE) Vehicles Rule Part One: One National Program.” (84 Fed. Reg. 51310, Sept. 27, 2019). The rule purported to use NHTSA’s statutory authority to assert that state programs related to fuel efficiency would be preempted by federal law. 

This rule was subject to significant litigation. (See “Preemption of State Fuel Economy Standards” in “Litigation” below).

Proposal to Reduce Federal Standards and The Safer Affordable Fuel-Efficient (SAFE) Vehicles Rule for Model Years 2021-2026 Passenger Cars and Light Trucks

On August 24, 2018, EPA and NHTSA jointly published a proposed rule titled “The Safer Affordable Fuel-Efficient (SAFE) Vehicles Rule for Model Years 2021-2026 Passenger Cars and Light Trucks” (the SAFE Vehicles rule).” (83 Fed. Reg. 42986, Aug. 24, 2018). The proposed rule outlined relaxed fuel economy standards for model year 2021-2026 passenger cars and light trucks (compared to those adopted under the Obama administration). Also in the proposed rule, NHTSA proposed regulatory text to make “explicit that State programs to limit or prohibit tailpipe [greenhouse gas] emissions or establish [zero emission vehicle] mandates are preempted” by federal law. 

Obama Administration (2009-2016)

Standards for Passenger Cars and Light Trucks, Model Years 2017-2021

On October 15, 2012, EPA and NHTSA jointly finalized CAFE standards for model years 2017-2021 (77 Fed. Reg. 62624, Oct. 15, 2012). The standards followed the same essential format as prior versions, but the agencies noted that these “standards will become more stringent on average in each model year from 2017 through 2025.” The same rule also outlined 2022-2025 standards, which it described as not binding, representing instead “NHTSA's current best estimate, based on the information available to the agency today, of what levels of stringency might be maximum feasible in those model years.” In total, these standards required each automobile manufacturer to reduce the average emissions from its vehicle fleet by approximately 5% per year between 2017 and 2025.

Standards for Passenger Cars and Light Trucks, Model Years 2012-2016

On May 7, 2010 EPA and NHTSA jointly finalized CAFE standards for model years 2012-2016. (75 Fed. Reg. 25324, May 7, 2010). The rules, the agencies wrote, were designed to “address the urgent and closely intertwined challenges of energy independence and security and global warming.” These standards required each automobile manufacturer to reduce the average emissions from its vehicle fleet by approximately 5% per year between 2012 and 2016.

Standards for Passenger Cars and Light Trucks, Model Year 2011

On March 30, 2009, NHTSA finalized CAFE standards applicable to model year 2011 vehicles. (74 Fed. Reg. 14196, Mar. 30, 2009). The narrow rule responded to time constraints built into the Energy Policy and Conservation Act requiring that CAFE standards be promulgated at least eighteen months before the model year begins. 

Litigation

CAFE Standards

CAFE Standards are frequently subject to challenges and litigation. For a compilation of climate-related litigation against CAFE standards, see the Sabin Center’s Climate Litigation Database (Clean Air Act, NHTSA).

Preemption of State Fuel Economy Standards
The Trump Administration’s purported preemption of state and local programs related to fuel efficiency was subject to several challenges initiated in 2019 and 2020, which were ultimately voluntarily dismissed after the Biden Administration withdrew the rule. For more information about these challenges, see the Sabin Center’s Climate Litigation Database (Union of Concerned Scientists v. National Highway Traffic Safety Administration; California v. Chao; EDF v. NHTSA)