States and cities sue Trump admin for loosening car fuel efficiency standards
New York Attorney General Letitia James called on the government to stop “giving handouts to big oil at the expense of American families.”
by Erik Uebelacker, Court House News, October 2, 2026
(CN) — Despite rising gas prices, the Department of Transportation unlawfully rolled back measures that would have required new vehicles to be more fuel efficient, according to a coalition of states and cities suing the Trump administration over the rule.
The group filed a petition for review in the First Circuit on Friday, challenging a new National Highway Traffic Safety Administration final rule, “Safer Affordable Fuel-Efficient Vehicles Rule III for Model Years 2022 to 2031 Passenger Cars and Light Trucks.”
Announced earlier this week, the policy would require manufacturers to produce vehicles averaging 34.9 miles per gallon by 2031, down from the previous target of more than 50 miles per gallon, according to New York Attorney General Letitia James, a member of the suing coalition.
“Piece by piece, this administration is attempting to dismantle the critical protections standing between the American people and climate disaster,” James said in a statement Friday. “Across the country, gas prices are skyrocketing and extreme weather is intensifying. There is no reason for the federal government to be giving handouts to big oil at the expense of American families, and we will keep fighting back to stop it.”
When announcing the final policy earlier this week, the Department of Transportation said the previous administration’s fuel efficiency requirements went too far. The department said the loosened rules will give automakers more flexibility to produce popular vehicles at lower costs for American consumers.
“Joe Biden and Pete Buttigieg illegally twisted mileage standards to create an electric vehicle mandate — jacking up car prices for American families and forcing manufacturers to produce vehicles no one wanted,” Transportation Secretary Sean Duffy said in a statement to Courthouse News on Friday. “I’m proud to stand with President Trump to say that those days are over. This administration understands the freedom of every American family starts with affordable cars. That’s why our new standards will make that dream more achievable by letting auto manufacturers produce the cars that fit families’ needs at a lower price.”
However, the states claim the change radically reinterprets Congress’ corporate average fuel economy standards, adopted during the mid-1970s energy crisis. They argue the loosened requirements will increase Americans’ fuel costs, particularly amid high energy prices from the U.S. war in Iran.
The Environmental Defense Fund, which filed a parallel First Circuit challenge Friday, claims the existing standards would have saved 64 billion gallons of gas and consumers $35 billion, even before the recent rise in fuel prices.
“The administration’s own projections show that Americans will be forced to spend over $1,600 more on fuel over the life of these life-efficient vehicles, and NHTSA estimates this final rule will result in an increase of over 121 billion gallons of fuel consumption through 2050,” the Environmental Defense Fund said in a press release.
Challenges to Transportation Department final rules bypass lower courts and go directly to the federal circuit, where the parties will detail their arguments in briefs ahead of a hearing.
But the states and cities outlined their objections in February, when the rule was still a proposal. They argued in a memo that the rollback was pretextual and driven by the administration’s push for greater fossil fuel use.
“Numerous executive orders confirm that the present action, like so many recent regulatory rollbacks and other actions across federal agencies, is part of the current Administration’s crusade to reshape the country’s energy sector to increase consumption of the fossil fuel resources the administration prefers, even when such an objective is contrary to the core purpose of the authorizing statute — in this case, the Energy Policy and Conservation Act,” they wrote at the time.
In addition to New York, the suing coalition includes California, Arizona, Colorado, Connecticut, Delaware, Hawaii, Illinois, Maine, Maryland, Michigan, Minnesota, New Jersey, New Mexico, New York, North Carolina, Oregon, Rhode Island, Vermont, Washington and Wisconsin, Massachusetts, the District of Columbia, Chicago, Denver, Los Angeles, New York City and San Francisco.