Republican Plan Would Gut CAFE Rules - CleanTechnica

The article discusses the potential impact of a Republican plan to undermine the Corporate Average Fuel Economy (CAFE) standards, which have been a key regulatory mechanism in the US auto industry since the 1970s. CAFE rules set minimum fuel efficiency targets for automakers, with financial penalties imposed for failing to meet these standards. Under the Biden administration, these standards have been raised significantly, aiming for passenger cars to achieve an average of 65 miles per gallon, up from 48 mpg currently. Automakers like General Motors and Stellantis have paid substantial fines for noncompliance, while companies producing only electric vehicles, such as Tesla and Rivian, benefit by selling excess credits to those who fall short. Tesla, in particular, has profited heavily from this system, with credit sales contributing significantly to its profitability and stock valuation. The Republican plan aims to weaken or dismantle the CAFE program, either through a lengthy regulatory overhaul or more directly by reducing the penalties for noncompliance to zero.