Tesla Urges Biden Administration to Implement Stricter Fuel Economy Standards
WASHINGTON, Oct 17 – Tesla, the renowned electric vehicle manufacturer, has called on the Biden administration to finalize significantly tougher fuel economy standards through 2032 than those proposed by U.S. regulators.
The National Highway Traffic Safety Administration (NHTSA) had proposed in July to increase Corporate Average Fuel Economy (CAFE) car requirements by 2% annually and by 4% for trucks and SUVs between 2027 and 2032. However, Tesla disagrees and is advocating for rules that would raise the stringency for cars by 6% annually and 8% for trucks and SUVs. According to Tesla, these higher standards would help “conserve energy and address climate change.”
If adopted, the NHTSA’s proposal would result in a fleet-wide average fuel efficiency of 58 miles (93 km) per gallon by 2032.
Tesla’s position puts the company at odds with major automakers who have sharply criticized the NHTSA’s proposal. On Monday, a group representing General Motors, Toyota Motor, Volkswagen, and most other major automakers requested significant revisions, deeming the proposal unreasonable.
Moreover, the American Automotive Policy Council, which represents the Detroit Three automakers, separately urged the NHTSA to reduce its proposed fuel economy increases to 2% annually for trucks. The group argued that the current proposal would disproportionately impact the truck fleet, emphasizing that 83% of vehicles produced by Ford, GM, and Chrysler parent company Stellantis are trucks.
In response to the criticism, the NHTSA defended its rule, stating that it aims to “save Americans money at the gas pump and strengthen American energy independence.” The agency estimated that the combined benefits of the proposal exceed costs by over $18 billion.
The Alliance for Automotive Innovation has warned that automakers would face more than $14 billion in non-compliance penalties between 2027 and 2032.
Toyota also raised concerns, stating that the fines indicate insufficient technology to meet the proposed standards and that the standards have been set beyond what is feasible. U.S. automakers have similarly expressed worry, with GM estimating $6.5 billion in fines, Stellantis projecting $3.1 billion, and Ford anticipating $1 billion in costs, according to NHTSA projections.
In addition to the fuel economy standards, automakers have also voiced alarm over the Energy Department’s proposal to revise the calculation of the petroleum-equivalent fuel economy rating for electric vehicles (EVs) in the NHTSA’s CAFE program. Automakers argue that the proposed revision would devalue the fuel economy of EVs by 72%.
The final decision on the fuel economy standards will have significant implications for the automotive industry and the move towards sustainable transportation. As the debate continues, it remains to be seen how the Biden administration will balance the interests of automakers, environmental advocates, and consumers.
Reporting by David Shepardson; editing by Jason Neely