Trump Administration Delays Fine Increase For Carmakers That Miss Fuel Economy Targets

The Trump administration will delay the introduction of higher fines for car manufacturers that do not meet fuel economy targets.

In 2015, the Congress ordered federal agencies to increase penalties to account for inflation. Fines were set to increase from $5.50 to $14 for each tenth of a mile per gallon that a carmaker’s fleet average fell short of Corporate Average Fuel Economy (CAFE) standards, and multiplied by the number of vehicles sold.

The Trump administration made the decision to suspend the regulation change in 2019, but the U.S. Court of Appeals for the Second Circuit overturned this move in August 2020.

Read Also: U.S. Vehicle Fleet Average Worsens To 24.9 MPG

Fast forward to the final days of the Trump presidency and, according to Reuters, the National Highway Traffic Safety Administration (NHTSA) confirmed that it has granted a petition from the Alliance of Automotive Innovation to delay the fine increase until the 2022 model year.

“Today’s interim rule ensures that the increased CAFE civil penalty rate will not be applied retroactively to previous model years, or with design and manufacturing plans that cannot be changed to improve fuel economy,” the NHTSA said in a statement.

Automakers have been protesting the hike in fines since they were first announced, claiming the change could increase compliance costs by $1 billion annually. Meanwhile, environmental groups have continually urged the administration to retain the increase, stating that U.S. fuel economy fines have lost nearly 75 per cent of their original value as they have only increased once since being first implemented in 1975, jumping from $5 to $5.50 in 1997.

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