The Safer Affordable Fuel-Efficient (SAFE) Vehicles Rule III for Model Years 2022 to 2031 Passenger Cars and Light Trucks

NHTSA described in the proposal that in the past decade, the consumer costs (via fuel prices), national balance of payments, and foreign policy implications of the need to consume large quantities of petroleum in the United States, especially imported petroleum, have shaped the consideration of this factor in ways that Congress could not have foreseen in the 1970s when EPCA was enacted. As NHTSA previously acknowledged in the 2020 final rule, there are two paths to petroleum independence: the first is simply to use less petroleum, and the second is for the United States to produce more of its own petroleum and to use less petroleum purchased from abroad. NHTSA outlined in the proposal how the United States became a net exporter of petroleum on an annual basis in 2020 (and on a monthly basis for the first time in September 2019) for the first time since at least 1949 and continued to export more petroleum than it imported in 2021, 2022, and 2023.\1110\ In fact, the United States currently produces the most oil (particularly shale oil) of any country.\1111\ The sources of imports to the U.S. have also changed significantly since EPCA's passage; whereas OPEC nations were the source of 70 percent of U.S. total petroleum imports in 1977, Canada now represents the largest source at 52 percent of gross total petroleum imports, and imports from OPEC nations represent only 16 percent.\1112\ This shift helps insulate the U.S. from supply shocks attributable to imports from the most volatile regions. A concurrent change in global oil market dynamics has helped steady the fuel prices that consumers experience in the wake of potential impacts to supply from foreign oil-producing countries:

the oil market is simply less reactive to global events.\1113\ Isolated subnational events, like the 2021 Colonial Pipeline ransomware attack, still have the potential to cause short-term price spikes in specific areas of the country,\1114\ but that national-level gasoline prices have held steady and have even modestly decreased through major global events evidences at least some decoupling of fuel prices and the concerns that led to EPCA's passage in 1975. Although further events have introduced temporary volatility into global crude markets since the proposal's publication, the agency does not expect these short-term disruptions to alter long-term fuel price trajectories, which remain governed by broader global supply and demand trends.

\1110\ EIA, Oil and Petroleum Products Explained, last revised: Jan. 19, 2024, available at: https://www.eia.gov/energyexplained/oil-and-petroleum-products/imports-and-exports.php (accessed: May 29, 2026); EIA, Frequently Asked Questions (FAQs): How Much Petroleum Does the United States Import and Export?, available at: https://www.eia.gov/tools/faqs/faq.php?id=727&t=6 (accessed: May 29, 2026).

\1111\ EIA, Today in Energy: United States Produces More Crude Oil Than Any Country, Ever, last revised: Mar. 11, 2024, available at: https://www.eia.gov/todayinenergy/detail.php?id=61545# (accessed: May 29, 2026).

\1112\ Id.

\1113\ See, e.g., Domonoske, C., Why a War in the Middle East Hasn't Sparked an Oil Crisis, last revised: June 25, 2025, available at: https://www.npr.org/2025/06/25/nx-s1-5444030/oil-prices-iran-israel (accessed: May 29, 2026).

\1114\ Thorbecke, C., Gas Hits Highest Price in 6 years, Fuel Outages Persist Despite Colonial Pipeline Restart, last revised: May 17, 2021, available at: https://abcnews.go.com/US/gas-hits-highest-price-years-fuel-outages-persist/story?id=77735010 (accessed: May 29, 2026) (gas prices in Southern States jumped 18-21 cents, while the national average rose eight cents).

While shifts have occurred in the global oil market, fuel use has not decreased appreciably despite a dramatic increase in fuel economy standards over the past 15 years. Since the agency began setting fuel economy standards in the early 2010s, motor gasoline consumption in the United States has hovered in the realm of the upper 8 million to low 9 million barrels per day (with a brief decrease in 2020 to just 8 million barrels per day).\1115\ There are a number of reasons why fuel consumption may hold steady as vehicle fuel economy increases (e.g., vehicle miles traveled have increased substantially in response to the economy or the rebound effect), but the fact that even significantly increased vehicle fuel economy standards have not decreased fuel consumption at measurable levels in the real world should be considered by NHTSA in how heavily it weighs the need of the United States to conserve energy relative to other factors. This is particularly true given the diminishing effects attributable to fuel economy improvements: as fuel economy standards increase in stringency, the yield in reduced fuel consumption decreases. In mpg terms, a vehicle owner who drives a light vehicle 15,000 miles per year (a typical assumption for analytical purposes) and trades in a vehicle with fuel economy of 15 mpg for one with fuel economy of 20 mpg, will reduce their annual fuel consumption from 1,000 gallons to 750 gallons--saving 250 gallons annually. If, however, that owner trades in a vehicle that achieves 30 mpg for one that achieves 40 mpg, then the owner's annual gasoline consumption would drop from 500 gallons/year to 375 gallons/ year--a fuel savings of only 125 gallons even though the mpg improvement is twice as large. Going from 40 to 50 mpg would save only 75 gallons/year. However, each incremental improvement in fuel economy becomes more expensive to achieve as the easiest to achieve low-cost technological improvement options are exhausted. Although fuel economy standards may support energy conservation, the agency must set maximum feasible standards based on the subsection 32902(f) factors.

\1115\ EIA, Petroleum & Other Liquids: U.S. Product Supplied of Finished Motor Gasoline, last revised: Aug. 29, 2025, available at: https://www.eia.gov/dnav/pet/hist/LeafHandler.ashx?n=PET&s=MGFUPUS2&f=A (accessed: May 29, 2026).

Whether CAFE standards remain the most effective way to accomplish the goal of using less gasoline in the light-duty motor vehicle fleet to increase energy security is a decision for Congress, but for now, EPCA's directive to NHTSA is to set CAFE standards in each model year, and that is what the agency will continue to do. Within this framework, however, accounting for particular realities--specifically that oil consumption in the United States has remained steady or increased even in the face of significantly increased fuel economy standards while the country has simultaneously become a net petroleum exporter and the world's largest oil producer--led the agency to conclude that the weight of these three facets of the need of the United States to conserve energy did not lead the agency to consider higher CAFE standards than the proposal's Alternative 2 as maximum feasible.

In the proposal, NHTSA evaluated the environmental impacts associated with the action alternatives as part of its statutory assessment of the need for the United States to conserve energy. The agency explained that because the proposed standards would lower upfront vehicle costs relative to the baseline, they would incrementally stimulate vehicle sales, particularly among modestly less fuel-efficient models. Although this shift would result in a slight net increase in total fuel consumption and marginal increases in both upstream and downstream emissions, these factors would be partially counterbalanced by reduced driving demand stemming from higher per-mile driving costs. Ultimately, the agency's analysis in the Draft SEIS demonstrated that any overall emissions increases would remain marginal, and that both criteria and non-criteria emissions would continue to decline over time due to natural fleet turnover. Consequently, the agency tentatively concluded that these nominal environmental impacts affirmed that energy conservation goals did not weigh heavily enough against the countervailing factors of economic practicability and technological feasibility to merit more stringent standards.

In addition, the proposal reexamined the geopolitical and economic context governing the need of the United States to conserve energy, concluding that maximum feasible fuel economy standards should reflect America's modern energy landscape. Driven by the domestic shale-oil boom, the United States has achieved a level of energy independence and resource abundance that was entirely unforeseen when EPCA was enacted in 1975. Furthermore, the vulnerability of the United States to foreign oil shocks has been substantially mitigated as remaining petroleum imports have shifted away from volatile OPEC nations toward stable regional partners like Canada and Mexico. Given this diminished exposure to supply disruptions, NHTSA tentatively determined that fuel economy standards should function as an insurance policy against risk-- increasing at steady, incremental, and manageable rates rather than imposing aggressive conservation mandates. Thus, the agency's proposal asserted that it is both reasonable and consistent with EPCA to require continuous fuel economy improvements over time, but at sustainable levels that protect manufacturers, consumers, and the broader economy.

The agency received extensive and highly detailed comments on its evaluation of the need of the United States to conserve energy. Major categories of comments included how the Nation's status as a net energy exporter should influence the stringency of the standards, whether NHTSA must consider environmental and climate impacts under this factor, and whether the agency adequately justified its departures from past analyses of energy and environmental effects.

Several commenters generally agreed with the agency's assessment that the Nation's need to conserve energy has fundamentally shifted due to recent increases in domestic energy production. IER and ACI noted that the CAFE program was created in response

to the 1973 Arab oil embargo and strengthened under EISA when U.S. net oil imports surpassed 12 million barrels per day.\1116\ Noting that the United States became a net petroleum exporter in 2020, IER commented that the original purpose of the CAFE program has been superseded, asserting that “there is zero need for the U.S. to conserve oil” and that this statutory factor should consequently be given no weight.\1117\ PMI similarly commented that there is no need to conserve energy.\1118\ ACI also commented that the original purpose of the CAFE program--to reduce dependence on OPEC--has already been achieved.\1119\ AFPM commented that the U.S. oil industry now leads the world, producing roughly 13.6 million barrels of crude per day and accounting for 90 percent of global production increases between 2015 and 2024.\1120\ They stated that this domestic growth stabilizes global prices and directly benefits U.S. consumers.\1121\ PMI agreed with the agency that energy conservation under EPCA functions as a form of “national economic insurance against the volatility of foreign energy markets.” \1122\ PMI commented that because the U.S. exported 1.64 million barrels of oil per day more than it imported in 2023, global price volatility now primarily results in a redistribution of wealth within the domestic economy rather than a transfer to foreign adversaries, making the original national security justification for strict energy conservation mandates outdated.\1123\

\1116\ IER, Docket No. NHTSA-2025-0491-6029, at 2-3; ACI, Docket No. NHTSA-2025-0491-4892, at 2.

\1117\ IER, Docket No. NHTSA-2025-0491-6029, at 2-3.

\1118\ PMI, Docket No. NHTSA-2025-0491-5001-A2, at 1.

\1119\ ACI, Docket No. NHTSA-2025-0491-4892, at 7.

\1120\ AFPM, Docket No. NHTSA-2025-0491-5964-A2, at 14.

\1121\ Id. at 15.

\1122\ PMI, Docket No. NHTSA-2025-0491-5001-A2, at 54.

\1123\ Id. at 36.

Although AFPM acknowledged that the U.S. cannot insulate itself from global oil price dynamics because crude oil is traded on an integrated worldwide market, it stated that marginal petroleum savings decline as vehicle fuel economy rises.\1124\ Because the cheapest and most effective fuel-economy-improving technologies have already been applied, AFPM asserted that foreign-policy gains become progressively less significant as standards become more stringent, which moderates the need for even higher standards.\1125\ Similarly, PMI commented that because the relationship between fuel economy and fuel consumption is non-linear, the marginal utility of each additional mile per gallon plummets at higher stringency levels, making aggressive conservation mandates an economically inefficient method for hedging against supply shocks.\1126\

\1124\ AFPM, Docket No. NHTSA-2025-0491-5964-A2, at 17.

\1125\ Id. at 18.

\1126\ PMI, Docket No. NHTSA-2025-0491-5001-A2, at 36.

Conversely, several commenters, including environmental groups and States, commented in opposition to the agency's analysis of the need to conserve energy in light of updated global conditions. The Oregon Department of Environmental Quality (OR DEQ) commented that, because EPCA expressly mandates the implementation of a regulatory program to reduce national energy consumption, the agency's proposal may violate the statute by knowingly proposing alternatives that will increase national energy consumption.\1127\ NRDC et al. and the Attorneys General commented that the U.S. remains highly exposed to the global oil market.\1128\ The Attorneys General noted that the U.S. still imports roughly 3 million barrels of crude oil per day to supply refineries tailored for heavy crude oil.\1129\ As noted in Section V.A, above, they highlighted regional vulnerabilities, noting that Hawaii has no domestic petroleum sources, depends on petroleum for 80 percent of its energy, and remains highly exposed to geopolitical supply chain disruptions.\1130\ NRDC et al. and the Attorneys General also stated that NHTSA arbitrarily assumes in its modeling that there will not be shocks or volatility in oil prices.\1131\

\1127\ OR DEQ, Docket No. NHTSA-2025-0491-5937, at 1-2.

\1128\ NRDC et al., Docket No. NHTSA-2025-0491-5928-A2, at 52- 55; Attorneys General, Docket No. NHTSA-2025-0491-6064-A2, at 73-74.

\1129\ Attorneys General, Docket No. NHTSA-2025-0491-6064-A2, at 75.

\1130\ Id. at 75-77.

\1131\ NRDC et al., Docket No. NHTSA-2025-0491-5928-A2, at 54- 55; Attorneys General, Docket No. NHTSA-2025-0491-6064-A2, at 73.

Commenters also included data demonstrating that the U.S. remains exposed to the global oil market despite domestic production gains. Members of Congress (Matsui et al.) noted that 40 percent of the oil refined by U.S. fuel refineries is still imported, keeping the American transportation system dependent on foreign nations and vulnerable to price shocks after events like Russia's 2022 invasion of Ukraine.\1132\ NRDC et al. commented that the agency's own analysis assumes that 90 percent of any additional gasoline consumed due to the standards reset will come from imported crude oil, and thus, even with domestic production of crude oil, the United States can only supply a small portion of the fuel needed to sustain the transportation sector, and the country continues to rely heavily on foreign oil.\1133\ The Attorneys General commented that NHTSA is basing permanent regulatory decisions on a temporary peak in domestic oil production, citing an International Energy Agency forecast that warns of a protracted period of turbulent markets and a precipitous stalling of U.S. shale growth.\1134\ To underscore their point about risks of continued oil reliance, the Attorneys General also pointed to past NHTSA reliance on a Council on Foreign Relations report asserting that domestic consumption impacts national security by limiting U.S. alliances, empowering adversarial oil-exporting nations, and necessitating an ongoing military presence in the Middle East.\1135\ ME DEP also stated that the proposal heightens national exposure to global oil price volatility.\1136\ They pointed to the agency's PRIA, which estimates that the proposed standards reset will reduce energy security benefits by $4.21 billion to $7.84 billion compared to the No-Action Alternative.\1137\ They also highlighted regional impacts, asserting that the 2022 Russian invasion of Ukraine caused petroleum prices in the Northeast to rise sharply, imposing severe burdens on Maine households.\1138\

\1132\ Matsui et al., Docket No. NHTSA-2025-0491-6065-A1, at 1.

\1133\ NRDC et al., Docket No. NHTSA-2025-0491-5928-A2, at 54.

\1134\ Attorneys General, Docket No. NHTSA-2025-0491-6064-A2, at 73 (citing International Energy Agency (IEA), Oil 2025: Analysis and Forecast to 2030, IEA: Paris, France, p. 6 (2025), available at: https://www.iea.org/reports/oil-2025 (accessed: May 28, 2026)).

\1135\ Attorneys General, Docket No. NHTSA-2025-0491-6064-A2, at 7.

\1136\ ME DEP, Docket No. NHTSA-2025-0490-0026, at 3.

\1137\ Id.

\1138\ Id.

These commenters also stated that the agency's reliance on net- exporter status to weaken standards is arbitrary and capricious. NRDC et al. noted that the U.S. became a net exporter in 2020, yet in the May 2022 and June 2024 CAFE rulemakings, the agency concluded that because oil prices are inherently volatile, “the only means of reducing the exposure of U.S. consumers to global oil shocks is to reduce their

consumption.” \1139\ The Attorneys General also stated that the agency failed to provide the required more detailed justification for abandoning its positions held as recently as the 2024 final rule that the U.S. still imported a substantial amount of oil from countries vulnerable to supply shocks even in light of the country's status as a net oil exporter, especially considering recent price shocks like those occurring following Russia's invasion of Ukraine.\1140\ Furthermore, NRDC et al. argued that if Congress believed the need to conserve energy had diminished due to domestic production, it would have amended EPCA; absent such amendment, they stated that the agency lacks statutory authority to deprioritize the statute's core conservation mandate.\1141\

\1139\ NRDC et al., Docket No. NHTSA-2025-0491-5928-A2, at 55.

\1140\ Attorneys General, Docket No. NHTSA-2025-0491-6064-A2, at 75-77.

\1141\ NRDC et al., Docket No. NHTSA-2025-0491-5928-A2, at 53.

The agency notes that one of the strengths of the CAFE framework established by EPCA, and as amended by EISA, is that it charges NHTSA to balance competing factors, including the need of the United States to conserve energy. This framework enables the agency to carry out its obligations in different energy and economic circumstances. As the need of the United States to conserve energy is heightened--such as when the United States was heavily reliant upon petroleum imported from countries vulnerable to supply shocks--that factor should be weighed more heavily. At times when the United States is less susceptible to petroleum supply shocks, that factor appropriately bears less weight-- but remains a significant factor in determining maximum feasible fuel economy standards. In addition, NHTSA recognizes, as the agency did in the proposal, that the U.S. remains connected to global energy markets, and that domestic consumers still feel the impact of international price shocks. However, the country's macroeconomic position has changed fundamentally since the CAFE program was created in the 1970s and expanded in 2007, and NHTSA must continue to weigh the impacts of increasing standards in light of changed circumstances against the other impacts to consumers. In addition, a measured approach to increasing fuel economy standards, such as that represented by the alternatives considered in this final rule, provides an institutional framework better suited to long-term manufacturer compliance than standards that rise too quickly, that manufacturers cannot functionally comply with and then cannot result in real-world energy conservation benefits.

Regarding comments that this position breaks with the 2022 and 2024 rulemakings, NHTSA recognized in the proposal that total energy independence is not possible for any country that participates in the global energy market, and that even if the U.S. consumed only domestically produced petroleum and continued to export, the U.S. economy would still be subject to oil price fluctuations due to external events and situations.\1142\ However, the proposal and this final rule also recognize that risks from global oil price fluctuations are much lower than they would have been in the absence of the rapid growth in U.S. oil production, and this diminished risk means that the need of the U.S. to conserve energy is significantly less than it was at earlier points in the history of the program.\1143\ Federal agencies are permitted to update their analytical frameworks when conditions change. In addition, Congress did not mandate in EPCA that the need of the United States to conserve energy must be the most heavily weighted subsection 32902(f) factor. Instead, Congress granted NHTSA the discretion to balance four distinct statutory considerations without establishing a hierarchy among them. EPCA authorizes the agency to weigh the other three factors--such as economic practicability or technological feasibility--more heavily than the need of the United States to conserve energy when contemporary data, market conditions, or other circumstances indicate that such a balance is appropriate to establish a maximum feasible standard.

\1142\ 90 FR 56438, 56587.

\1143\ Id.

Regarding comments that NHTSA's modeling does not capture volatility in oil prices, EIA's Annual Energy Outlook, which NHTSA has relied on for fuel price projections for almost two decades, incorporates comprehensive assumptions to project structural, long-term oil price trajectories based on underlying global supply and demand trends. For the purposes of NHTSA's modeling, relying on these stable, multi-decade projections is more important than attempting to capture highly volatile and unpredictable short-term market disruptions. That said, as in all past CAFE rulemakings, NHTSA has performed sensitivity analyses using various AEO side cases with diverse long-term oil price projections.

Commenters also debated the impact of the proposed standards on U.S. military spending and foreign policy. AEI supported the agency's decision to disregard military costs, arguing that defense assets serve multiple, long-term functions and that allocating a fixed portion of defense costs specifically to the defense of sea lanes for oil is analytically arbitrary.\1144\ Other commenters disagreed with the agency's analysis of these costs. The Attorneys General and NRDC et al. commented the agency acted arbitrarily and capriciously by asserting that changes in petroleum use are unlikely to affect military activity.\1145\ The Attorneys General commented that NHTSA's failure to quantify the military costs of securing global petroleum was arbitrary and capricious, stating that the agency lacked support for its claim that foreign policy considerations have shifted and failed to explain how the proposal's projected increase in oil consumption would avoid escalating U.S. military expenditures, particularly in light of recent interventions.\1146\ NRDC et al. also cited a 2018 paper by Securing America's Future Energy estimating that the U.S. military spends at least $81 billion annually protecting global oil supplies, amounting to an implicit subsidy of roughly $0.28 per gallon of fuel consumed.\1147\ As mentioned above, the Attorneys General and NRDC et al. also pointed to recent actions, including the seizure of Venezuelan oil tankers and executive statements prioritizing the flow of Venezuelan oil to reduce American gas prices, as evidence that U.S. military and foreign policy resources remain heavily tied to securing global oil supplies.\1148\

\1144\ AEI, Docket No. NHTSA-2025-0490-0061, at 2-3.

\1145\ Attorneys General, Docket No. NHTSA-2025-0491-6064-A2, at 77; NRDC et al., Docket No. NHTSA-2025-0491-5928-A2, at 64-65.

\1146\ Attorneys General, Docket No. NHTSA-2025-0491-6064-A2, at 77.

\1147\ NRDC et al., Docket No. NHTSA-2025-0491-5928-A2, at 64- 65.

\1148\ Attorneys General, Docket No. NHTSA-2025-0491-6064-A2, at 77; NRDC et al., Docket No. NHTSA-2025-0491-5928-A2, at 65-65.

As NHTSA has long maintained,\1149\ U.S. military spending cannot be reliably linked to marginal changes in fleetwide fuel economy. As discussed in more detail in TSD Chapter 6, while lower U.S. oil demand could theoretically enable the U.S. to reduce military spending on protecting foreign oil supplies, evidence shows these expenses do not change based on domestic consumption. For instance, neither the Nation's recent shift to becoming a net oil exporter nor the

dramatic increase in fuel economy in recent years have led to a drop in military spending. This is because U.S. military presence in oil- producing regions is aimed at maintaining overall global stability and not merely securing U.S. imports. U.S. military operations would continue near oil-producing regions regardless of the exact number of gallons of oil consumed by the domestic light-duty vehicle fleet.

\1149\ See, e.g., 89 FR 52540, 52685 (June 24, 2024).

NRDC et al.'s comment does not distinguish between the average spending associated with oil consumption and the marginal effect of changes caused by CAFE standards. As noted by Parry and Darmstadter (2002), “[Military spending] does not really vary with (modest) changes in oil imports; military spending is more of a fixed cost than a variable cost. A policy to moderately reduce imports over time, and that did not entirely eliminate import dependency, would probably have little benefit in terms of cutting the costs of U.S. military involvement in the region.” \1150\ For this reason, most recent economic studies that quantify energy security-related benefits associated with policies like CAFE standards do not include changes in military spending.\1151\ Using an average cost as NRDC et al. suggests would be inappropriate when measuring the costs and benefits of marginal reductions in fuel consumption associated with changes in the standards.

\1150\ Parry, I., & Darmstadter, J., The Costs of U.S. Oil Dependency, Resources for the Future Discussion Paper 03-59, Resources for the Future: Washington, DC (2003), available at: https://www.rff.org/documents/1541/RFF-DP-03-59.pdf (accessed: June 11, 2026).

\1151\ See for example: Brown, S., New estimates of the security costs of U.S. oil consumption, Energy Policy, Vol. 113: pp. 171--92 (2018), available at: https://doi.org/10.1016/j.enpol.2017.11.003 (accessed: June 9, 2026); Brown, S., & Huntington, H., Assessing the U.S. oil security premium, Energy Economics, Vol. 38: pp. 118--27 (2013), available at: 10.1016/j.eneco.2013.03.010 (accessed: May 26, 2026).

The agency also received conflicting comments on how increased fuel consumption affects consumer costs and welfare. Although commenters like PMI agreed with the agency's characterization that increased fuel expenditures are domestic wealth transfers,\1152\ other commenters disagreed. NRDC et al., ACEEE, and the Attorneys General commented that the proposal harms consumers by forcing them to pay an estimated $1,400 more in fuel costs over the lifetime of their vehicles.\1153\ The Attorneys General and ACEEE commented that increased fuel costs disproportionately burden low-income households, who spend three times as much of their income on gasoline compared to higher income households.\1154\ The Attorneys General cited NHTSA's statement from the proposal that the increased petroleum consumption from the proposal will increase global petroleum demand, which will exert upward pressure on worldwide gas prices, and concluded independently that this would raise gas prices for all drivers.\1155\ The National Parks Conservation Association (NPCA) commented that increased household fuel costs lead to decreased national park visitation, subsequently reducing critical entrance fee revenues for the National Park Service.\1156\

\1152\ PMI, Docket No. NHTSA-2025-0491-5001-A2, at 36.

\1153\ NRDC et al., Docket No. NHTSA-2025-0491-5928-A2, at 56; ACEEE, Docket No. NHTSA-2025-0491-5943, at 1.

\1154\ Attorneys General, Docket No. NHTSA-2025-0491-6064-A2, at 74; ACEEE, Docket No. NHTSA-2025-0491-5943, at 1.

\1155\ Attorneys General, Docket No. NHTSA-2025-0491-6064-A2, at 7.

\1156\ NPCA, Docket No. NHTSA-2025-0491-5962, at 2.

NHTSA acknowledges that lower fuel economy standards mean consumers could, on average, spend more on gasoline over the lifespan of their vehicles. However, the agency must also recognize that, while higher standards can create downstream fuel savings, they require manufacturers to install potentially expensive technologies that raise the upfront sticker price of a vehicle. For many buyers, particularly low-income households with limited access to credit, a high vehicle cost can price them out of the new vehicle market entirely. This forces them to remain in older, less efficient, and less safe vehicles. NHTSA's purpose in evaluating the range of alternatives considered is to find the alternative that keeps upfront vehicle purchase prices manageable while allowing for steady efficiency improvements that control long-term fuel costs. In addition, nothing in this rule prohibits manufacturers from producing and consumers who value fuel economy from purchasing more fuel-efficient vehicles. NHTSA also acknowledges the connection between petroleum demand and market pricing, as the agency recognized in the proposal, but notes that the Attorneys General failed to include the second part of NHTSA's conclusion that because the United States is a net exporter, the transfer from global consumers to petroleum producers becomes a financial benefit to the U.S. economy.\1157\ That said, as discussed in more detail below, none of the alternatives analyzed in this final rule would significantly increase fuel consumption compared with the levels of fuel estimated to be consumed under the No-Action Alternative.

\1157\ 90 FR 56438, at 56515 (Dec. 5, 2025).

Regarding quantified environmental and health impacts of the proposal, multiple commenters expressed strong opposition to the agency's treatment of the anticipated impacts on climate change and its estimates of GHG emissions and the assumptions surrounding the social cost of carbon. NRDC et al. stated that the tailpipe and upstream CO2 emissions projected in the modeling would result in worsening global surface temperatures, sea-level rise, precipitation anomalies, and ocean acidification.\1158\ ZETA, the Attorneys General, and NRDC et al. all commented that the agency improperly excluded the costs of increasing GHG emissions from its cost-benefit analyses, and asserted that incorporating the value of these climate benefits would prove increased fuel economy to be more cost-effective.\1159\ In particular, the Attorneys General claimed that this omission ignored $230 to $351 billion in climate damages.\1160\ Several commenters also commented that NHTSA's decision to exclude monetized estimates of changes in GHG emissions from the central analysis, stating that it was inconsistent with the 9th Circuit decision in Center for Biological Diversity v. NHTSA.\1161\ NRDC et al. and the Attorneys General similarly criticized the domestic-only SCC sensitivity analysis, which they stated ignored global spillover effects on U.S. citizens and corporations and ignored OMB Circular A-4 guidance, among other things.\1162\ The National Tribal Air Association (NTAA) commented that the transportation sector's increased CO2 emissions would accelerate extreme weather events--including prolonged droughts, severe storms, wildfires, and ecological shifts--that uniquely threaten the economic stability, sustenance, and traditional lifeways of tribes and Alaskan Native Villages.\1163\

\1158\ NRDC et al., Docket No. NHTSA-2025-0491-5928-A2, at 61.

\1159\ ZETA, Docket No. NHTSA-2025-0491-6039-A1, at 6; Attorneys General, Docket No. NHTSA-2025-0491-6064-A2, at 81-88; NRDC et al., Docket No. NHTSA-2025-0491-5928-A2, at 62-64.

\1160\ Attorneys General, Docket No. NHTSA-2025-0491-6064-A2, at 81.

\1161\ Attorneys General, Docket No. NHTSA-2025-0491-6064-A2, at 81-82; ZETA, Docket No. NHTSA-2025-0491-6039-A1, at 6; NRDC et al., Docket No. NHTSA-2025-0491-5928-A2, at 62-64.

\1162\ NRDC et al., Docket No. NHTSA-2025-0491-5928-A2, at 64; Attorneys General, Docket No. NHTSA-2025-0491-6064-A2, at 85-88.

\1163\ NTAA, Docket No. NHTSA-2025-0491-4852, at 2.

The Attorneys General also commented in opposition to the

agency's characterization of the results of the criteria pollutant and health benefits analysis as “slight.” \1164\ The Attorneys General argued that all of the proposed action alternatives increase emissions relative to the No-Action baseline, and that the agency is improperly and unlawfully crediting its reset for environmental improvements that are occurring independent of, and in spite of, the proposed standards.\1165\ NRDC et al. also commented that NHTSA underestimated criteria pollution impacts by using outdated 2025 health incidence values to project harms through 2050, and by ignoring the ozone impacts of NOX emissions, leading to an underestimation of public health harms by 6 to 26 times.\1166\ NTAA also commented on the specific health harms of increased emissions, noting that emissions of volatile organic compounds, nitrogen oxides, and fine particulate matter disproportionately harm tribal communities.\1167\ They submitted data showing that American Indian and Alaska Native adults suffer from asthma at a 13-percent rate, with their children reporting 42 percent more cases than the general population, arguing that the agency's proposal will prolong acute and chronic exposures to dangerous pollutants for these vulnerable populations.\1168\

\1164\ Attorneys General, Docket No. NHTSA-2025-0491-6064-A2, at 88.

\1165\ Attorneys General, Docket No. NHTSA-2025-0491-6064-A2, at 88.

\1166\ NRDC et al., Docket No. NHTSA-2025-0491-5928-A2, at 58- 61.

\1167\ NTAA, Docket No. NHTSA-2025-0491-4852, at 1-2.

\1168\ Id.

NHTSA has determined that by encouraging faster fleet turnover, the finalized standards will help transition drivers into newer, cleaner, and more efficient vehicles faster than more stringent alternatives would allow, which provides long-term health and environmental benefits while also offering reduced upfront vehicle costs for consumers. In the central analysis supporting this final rule, NHTSA continues to exclude estimates of changes in CO2, CH4, and N2O valuation, consistent with current Executive Order 14154 and Office of Management and Budget guidance. The agency maintains that significant, compounding uncertainties--including the precise macroeconomic response to climate shifts, long-term technological adaptation, demographic variables, and intergenerational discounting methodologies--render these valuation metrics highly speculative. Relying on such figures in the central analysis could inadvertently result in flawed decision-making due to an overreliance on deeply uncertain values. The domestic-only CO2, CH4, and N2O valuation sensitivity cases focuses on domestic economic impacts because CAFE is a domestic regulatory program, and the costs and benefits are ordered similarly across the alternatives as in the central analysis. Relying on global valuation estimates would introduce an even higher level of uncertainty, for the reasons discussed in Section II above, and fails to maintain the required analytical boundary that excludes economic effects occurring outside of United States borders. However, even if NHTSA had considered alternative valuation estimates, the agency would have selected the same final standards. As discussed in more detail in Sections V.C.2.a, V.C.2.b, and V.C.2.e, Alternatives 4 and 5 exceed maximum feasible levels due to manufacturer noncompliance. Where compliance is unachievable, projected fuel savings and climate benefits cannot materialize. Consequently, valuing changes in CO2, CH4, and N2O-- whether domestic or global--would not change the agency's determination of the maximum feasible standards.

When NHTSA described certain criteria pollutant variations across alternatives as “slight,” the agency was referring to an objective comparison of the incremental differences between the emissions occurring under the No-Action Alternative and the regulatory alternatives considered. However, in the Final SEIS, NHTSA has defined and clarified the use of “slight” and other descriptors that describe the magnitude of impacts in the Final SEIS. The Final SEIS discloses cumulative emissions changes, projected changes in climate indicators, and sensitivity analyses to provide transparency regarding the scale of the modeled impacts. Regarding quantified health metrics, the agency disagrees that its health effects modeling is outdated; the agency has utilized the most up-to-date data available for each category of effects for both upstream and downstream sources across several successive rulemakings. This methodology and response to comments is discussed in more detail in Section II.

Table V-10 shows estimated fuel use for the regulatory alternatives compared to the No-Action Alternative. Importantly, NHTSA emphasizes that under the No-Action Alternative, the gasoline- and diesel-powered vehicle fleet regulated in this action is anticipated to consume 2,639 billion gallons of gasoline through CY 2050. The increases in gasoline and diesel fuel consumption under the regulatory alternatives range from an additional 128 billion gallons of gasoline under the least stringent alternative to 36 billion gallons of gasoline under the most stringent alternative, with Alternative 3 as the mid-range alternative resulting in an additional 122 billion gallons of gasoline through 2050. To put this in perspective, Americans used 136.5 billion gallons of finished motor gasoline, cumulative in 2025,\1169\ meaning that resetting the fuel economy program would only result in a total of less than one additional year's worth of gasoline consumption by the U.S. vehicle fleet over almost 25 years through 2050.

\1169\ EIA, Gasoline Explained: What is octane?, last revised: Nov. 17, 2022, available at: https://www.eia.gov/energyexplained/gasoline/octane-in-depth.php (accessed: May 25, 2026).

[GRAPHIC] [TIFF OMITTED] TR30SE26.216

As with the proposal, emissions of various pollutants would increase in the regulatory alternatives relative to the No-Action Alternative as a result of both increased upstream emissions from the various fuel production processes and increased downstream emissions from fuel combustion as vehicles are driven commensurate with the fuel consumption increases. However, in the context of total emissions compared to the baseline, the incremental increases would be nominal. In addition, non-criteria emissions (NCEs) in all five action alternatives decrease over time, as newer vehicles enter the fleet. Criteria pollutant emissions similarly increase relative to the No- Action Alternative, but all action alternatives result in decreasing criteria pollutant emissions over time. FRIA Chapter 8 provides additional detail on the changes in emissions and, for criteria emissions specifically, associated calculated health outcomes. NHTSA's NEPA analysis similarly shows only nominal differences between the baseline and alternatives considered in this proposal. The results of that analysis are summarized below and in the Final SEIS. e. Synthesis of the Record Supporting Alternative 3 as Maximum Feasible

In establishing the final fuel economy standards, NHTSA is required under 49 U.S.C. 32902(f) to balance four statutory factors: technological feasibility, economic practicability, the need of the United States to conserve energy, and the effect of other motor vehicle standards of the Government on fuel economy. As NHTSA discusses throughout this final rule, EPCA does not permit the agency to look solely at energy conservation when setting maximum feasible fuel economy standards, instead explicitly requiring NHTSA to balance the four competing subsection 32902(f) factors. Accordingly, NHTSA tentatively concluded in the proposal that maximizing fuel savings at the expense of severe industry disruptions or unaffordable vehicle prices would place too little weight on the economic practicability factor and result in standards that exceed maximum feasibility. While NHTSA recognized that higher fuel consumption does lead to increased long-term fuel costs, overly aggressive standards impose immediate upfront cost increases on new vehicles that are already at record levels--slowing fleet turnover to newer, more efficient, cleaner, and safer vehicles. If vehicle prices rise too high, consumers are priced out of the new vehicle market entirely. A standard that is more stringent on paper does not save consumers money if they cannot afford to buy the vehicles. Looking only at total fuel volume also ignores how vehicle prices affect real-world safety outcomes. When new cars remain affordable, drivers replace older, less efficient, and less safe vehicles faster. Stricter standards that raise prices delay fleet turnover, keeping older cars on the road longer. Further, higher standards result in more rebound driving, where lower per-mile driving costs lead to more total miles driven, directly increasing crash exposure. Accordingly, NHTSA examined the marginal, long-term impact of increased fuel use from the regulatory alternatives against these general policy considerations.

To find the point that satisfied these competing factors, the agency developed and analyzed several action alternatives alongside a No-Action Alternative. While NHTSA examined the No-Action Alternative alongside three action alternatives for both MYs 2022-2026 and MYs 2027-2031 in the proposal, the agency responded to feedback from the public and considered two additional alternatives each for MYs 2022- 2026

and MYs 2027-2031 for this final rule. Throughout this preamble, TSD, FRIA, and Final SEIS, NHTSA describes its methodology for evaluating these regulatory alternatives and the potential effects that could result from the agency's selection of any of the alternatives as the final standards.

NHTSA agrees with several commenters that Alternatives 1 and 2, though reflecting distinct stringency increases over time, underrepresents vehicle manufacturer's technical capabilities and energy conservation. A wide array of technologies available for gasoline- and diesel-powered vehicles, such as advanced combustion, friction reduction, multi-valve architectures, and aerodynamic optimization, are already commercially available and deployed at high production volumes. Establishing a regulatory floor that changes by less than half a percent annually would fail to encourage the steady, incremental deployment of existing capabilities. Commenters like Honda further supported this conclusion, with Honda noting that advanced ICE refinements and multi-pathway efficiency technologies are robust enough to support annual improvements exceeding the proposed 0.25-percent- annual increase in stringency. Similarly, MEMA requested the agency to adopt Alternative 3 or a modified Alternative 3+ configuration. Both MEMA and MECA argued that dropping stringency to the levels defined in Alternatives 1 or 2 would create a technological deployment gap, weakening manufacturing market signals necessary to sustain domestic investments in efficiency engineering, and potentially risking billions of dollars of stranded capital in domestic research across vehicle components suppliers. While NHTSA recognizes concerns about sunk costs when considering changes in fuel economy standard, the agency agrees that the modified version of Alternative 3 appropriately accounts for technological capabilities of gasoline and diesel engines. In addition, while the Nation's status as a net energy exporter provides a structural macroeconomic buffer against oil price spikes, that fact does not absolve the agency of its statutory mandate to assign some weight to the need of the United States to conserve energy. Selecting these lower alternatives would result in a foregone reduction in petroleum consumption that is technically achievable through existing and available fuel economy-improving technologies.

On the other end of alternatives evaluated for this final rule, Alternatives 4 and 5 set initial MY 2022 target functions to an aggressive starting level and apply annual stringency increases that outpace the historic demonstrated efficiency improvements of the gasoline- and diesel-powered vehicle fleet, even in response to very stringent standards. In fact, by MY 2031, several manufacturers would be projected to under-comply with the Alternative 5 standards. The agency determined that the amount of manufacturer non-compliance using gasoline- and diesel-based vehicle technologies under Alternatives 4 and 5 demonstrates that these alternatives are beyond maximum feasible. To achieve these targets without the alternative fuel flexibilities, manufacturers would be pushed towards strong hybridization across all vehicle segments within a compressed time.

Although NHTSA's analysis projects all alternatives to reduce upfront vehicle costs compared to the No-Action standards, reducing upfront vehicle transaction prices is a factor the agency has determined should be accorded significant weight. Pricing buyers out of the new vehicle market would decelerate vehicle fleet turnover, keeping consumers in older, less safe, and less efficient vehicles longer. The agency carefully weighed the potential impacts of upfront cost increases against the magnitude of potential increases in fuel costs over several decades and cannot conclude that standards that result in a high upfront cost weigh in favor of maintaining more stringent standards.

In addition, NHTSA believes Alternatives 4 and 5 overweight energy conservation at the expense of economic practicability. As discussed in the proposal, NHTSA does not believe that the magnitude of fuel consumption and emission increases over the baseline would lead the agency to conclude that standards set at higher levels than Alternative 3 are maximum feasible. That the Alternative 3 standards are significantly different than the baseline standards and yet result in only marginal increases in fuel consumption and associated emissions metrics confirms NHTSA's conclusion that the environmental elements of the need of the United States to conserve energy do not weigh heavily enough against the countervailing factors of technological feasibility and economic practicability to merit the selection of more stringent standards.

Because the mathematical relationship between a vehicle's mpg rating and its actual fuel consumption is reciprocal, the marginal petroleum savings diminish significantly at these elevated stringency levels. NHTSA cannot weigh the need of the United States to conserve energy so high that it sets standards that would compel the vehicle fleet into rapid hybridization that results in continually flattening marginal improvements in fuel consumption, particularly because the Nation's net energy exporter status already mitigates some of the systemic economic and security risks historically associated with foreign energy dependency. Moreover, light-duty vehicle fuel consumption remains forecast to decline substantially over time, both as a result of NHTSA's standards and fleet turnover. The environmental effects related to fuel consumption, both because of NHTSA's standards and other light-duty transportation trends, will decrease proportionally based on effect and pollutant. NHTSA has concluded that the need of the United States to conserve energy weighs in favor of fuel economy standards acting as an insurance policy against risk, with standards that increase at steady, incremental, manageable rates for the light-duty gasoline- and diesel-powered fleets following their reset to align more closely with EPCA. In addition, the agency evaluated other environmental factors under NEPA and as part of its regulatory impact analysis to fulfill obligations under Executive Order 12866. Based on the results of those analyses, NHTSA confirms that the final standards selected in this rule remain the maximum feasible standards

Alternative 3 effectively balances the above concerns by requiring steady progress with deployable internal combustion and conventional hybrid technology. Considering the technologies available to meet the standards, and the achieved fuel economy levels that application of those technologies allows manufacturers to reach, NHTSA notes that a mid-range regulatory trajectory effectively minimizes the artificial over-compliance seen with less stringent options while avoiding the compliance deficits that emerge under the highest alternatives. The results indicate that an intermediate stringency level challenges the fleet to deploy available technologies at a sustainable pace, narrowing the gap between achieved and required fuel economy without exceeding the real-world engineering and product-cycle constraints of major manufacturers.

From an economic practicability standpoint, Alternative 3 addresses the vehicle cost concerns important to the agency, and as raised by commenters, while still requiring steady efficiency improvements. By avoiding the vehicle price increases associated with the

highest alternatives, a middle-ground standard helps keep new cars affordable for vehicle buyers. This approach also keeps compliance costs within realistic limits for automakers' varied production cycles, making the standards economically practicable for the industry as a whole. In addition, while NHTSA's models show relatively minor differences in total vehicle sales and manufacturing employment across the options, basic economic theory supports the principle that lower upfront vehicle costs help stimulate the market. Selecting a conservative mid-point aligns with this economic reality, encouraging steady sales growth and protecting automotive jobs by avoiding the market strain associated with more aggressive targets.

Alternative 3 appropriately balances technological feasibility and economic practicability by providing long-term investment certainty for the domestic supply chain and avoiding the technology deployment gaps associated with lower alternatives identified by commenters. Simultaneously, by keeping stringency increments within a single-digit fractional range, it avoids the high upfront technology costs associated with the upper alternatives, ensuring that standards remain economically practicable for the industry as a whole. Alternative 3 also shows decreases in the fleet's overall fuel use over time, through a combination of improved vehicle fuel economy values and fleet turnover, to fulfill the agency's statutory mandate to conserve energy while properly aligning the stringency of the standard with the Nation's contemporary, structurally insulated energy profile.

Furthermore, Alternative 3 has the benefit of smoothing the effects of the finalized regulatory reclassification of passenger cars and light trucks. Because moving passenger-focused crossover and SUV models out of the light truck fleet structurally lowers the mathematical mpg average of both individual regulatory categories, the standard incorporates a calibrated transition adjustment in MY 2030 (-0.5 percent for passenger cars and -14.4 percent for light trucks) before resuming a steady 1.0-percent increase in MY 2031. This transition ensures the standards remain aligned with the physical capabilities of the adjusted fleets without triggering artificial compliance penalties.

Consistent with its position in the proposal, NHTSA affirms that it chooses to weigh “the need of the United States to conserve energy” less heavily as America continues to develop its proven oil reserves, because the Nation's exposure to oil shocks is diminished. This is especially true as the remaining petroleum imported into the U.S. has shifted dramatically away from volatile Organization of the Petroleum Exporting Countries (OPEC) nations and toward Mexico and Canada since the enactment of EPCA. The U.S. currently possesses an abundance of domestic energy resources, especially petroleum and natural gas. Following the shale-oil boom, America has become the world's largest petroleum producer by a significant margin and is now a net petroleum exporter. This status was unthinkable when Congress enacted EPCA, and even EISA. The United States does not have the same need to conserve liquid-fuel energy resources that it had in the wake of the Arab oil embargoes of the 1970s or in the wake of Operation Iraqi Freedom. Accordingly, NHTSA believes that it is both reasonable and congruent with EPCA's energy conservation goals to weigh the need of the United States to conserve energy such that vehicle fuel economy standards require continuous improvements over time, but at sustainable levels for manufacturers, consumers, and society at large.

Finally, as discussed above, NHTSA considers estimated net benefits relevant to determining maximum feasible CAFE standards, but the agency's selection of a Preferred Alternative is not dependent on the alternative that maximizes those benefits. The agency's analysis shows that all regulatory alternatives would result in positive net benefits on a model year accounting basis at both three percent and seven percent discount rates, with the Preferred Alternative, Alternative 3, resulting in $41.8 billion in estimated net benefits using a three percent discount rate and $36.3 billion in net benefits using a seven percent discount rate.\1170\ At the three percent discount rate, Alternative 3 maximizes net benefits among all the alternatives analyzed.

\1170\ As is discussed in Chapter 8 of the FRIA, NHTSA estimates the benefits and costs of the regulatory alternatives under consideration from both model year and calendar year perspectives. The estimates shown here are for the model year approach.

Balancing all factors and issues identified, specifically in this section and more broadly throughout this entire preamble, TSD, FRIA, and Final SEIS, NHTSA is finalizing Alternative 3 as the final fuel economy standards for MYs 2022-2026 and MYs 2027-2031. The agency's conclusion is that increasing the stringency of the standards at these adjusted annual rates--which remain fully achievable by conventional gasoline- and diesel-powered vehicles--coupled with the re-examination of the target function shapes and vehicle classification definitions, best comports with the substantive textual requirements of EPCA and is responsive to feedback and analysis submitted by commenters on the agency's proposal.

Moreover, the level, shape, and applicability of the standards to the gasoline- and diesel-powered passenger and non-passenger fleets, as reclassified under this final rule, are justified by the need to resolve the distortions that previous regulations caused in the marketplace. Imposing such market distortions is inconsistent with a proper application of EPCA and results in an unnecessary regulatory burden without effectively insulating the United States from global oil price shocks. Ultimately, NHTSA believes that the steady, incremental increases provided by Alternative 3, which are reasonable and appropriate, effectively balance EPCA's energy conservation goals while fully preserving the ability of manufacturers to focus on safety, affordability, and consumer choice and while resulting in positive benefits for consumers and society. Although the proposal initially applied these balancing principles to Alternative 2, NHTSA's subsequent evaluation of public comments, supplemental data, and sensitivity analyses demonstrates that Alternative 3 provides the most statutorily faithful execution of these objectives. 3. Final Supplemental Environmental Impact Statement Analysis Results

NHTSA described above that the agency's NEPA-related obligation is to “take a `hard look' at the environmental consequences” of a rulemaking, as appropriate.\1171\ Significantly, “[i]f the adverse environmental [impacts] of the proposed action are adequately identified and evaluated, the agency is not constrained by NEPA from deciding that other values outweigh the environmental costs.” \1172\ NHTSA considers the impacts reported in the Final SEIS, in addition to the other information presented in this preamble, the Final TSD, and the FRIA, as part of its decision-making process.

\1171\ Baltimore Gas & Elec. Co. v. Natural Resources Defense Council, Inc., 462 U.S. 87, 97 (1983).

\1172\ Robertson v. Methow Valley Citizens Council, 490 U.S. 332, 350 (1989).

Per DOT Order 5610.1D, NHTSA considers a “No-Action” Alternative in its NEPA analyses and presents the environmental impacts of the final rule and alternatives, including the No-Action Alternative, in comparative

form.\1173\ The range of CAFE standard action alternatives, including the No-Action Alternative, encompasses a spectrum of possible fuel economy standards that NHTSA could determine is the maximum feasible based on the different ways NHTSA could weigh the applicable statutory factors.

\1173\ DOT Order 5610.1D, sec. 13.e.

Some commenters argued that NHTSA did not evaluate a reasonable range of action alternatives because the alternatives outlined in the proposal yielded similar outcomes, which they asserted fall below the maximum feasible standard required by EPCA, do not account for gradual standard increases, technology-neutral pathways, or policies aligned with infrastructure readiness, and do not maximize fuel savings and emission reductions.\1174\ As further explained in Appendix C of the Final SEIS, NHTSA disagrees with these commenters. NEPA does not require NHTSA to include alternatives that result in specific outcomes nor incorporate factors or policies that are beyond its statutory authority under EPCA. Rather, NHTSA finds that its proposed action and the action alternatives considered in its environmental analysis are technically and economically feasible and meet the purpose and need of this final rule, as required by NEPA.\1175\ Additional discussion of the alternatives that NHTSA considered in the final rule is provided in Section III of the final rule preamble.

\1174\ NRDC et al., Docket No. NHTSA-2025-0491-5948, at 7-8; CPAC-CRF, Docket No. NHTSA-2025-0491-5054, at 9; Daniel Anderson, Docket No. NHTSA-2025-0491-5042.

\1175\ 42 U.S.C. 4332(1)(C)(iii); see also DOT Order 5610.1D, sec. 13.e.

The agency's Final SEIS describes the reasonably foreseeable impacts for all alternatives across a variety of environmental resources, including energy, air quality, emissions effects, and historic and cultural resources. The impacts of the final rule are discussed in proportion to their significance, qualitatively and quantitatively, as applicable.\1176\ The findings of the analysis are summarized here, and more detailed discussion--in particular for any qualitative resource assessment--can be found in the Final SEIS.

\1176\ Section 13.g(2) of DOT Order 5610.1D.

Reasonably foreseeable energy impacts from the final rule include changes in vehicle fuel consumption. All five action alternatives would increase fuel consumption compared to the No-Action Alternative,\1177\ with fuel consumption increases that range from 114 billion GGEs under Alternative 5 to 210 billion GGE under Alternative 1. Alternative 3 (the Preferred Alternative) increases fuel consumption by 204 GGE.

\1177\ Total light-duty vehicle fuel consumption from 2024 to 2050 under the No-Action Alternative is projected to be 2,867 billion gasoline gallon equivalents (GGE).

The relationship between CAFE standards and criteria pollutant and air toxics emissions is less straightforward than the relationship between CAFE standards and energy use because the criteria pollutant and air toxics relationship reflects the complex interactions among many factors. In general, emissions of criteria air pollutants decrease with increasing stringency. However, the analysis shows that the action alternatives would result in various levels of emissions when measured against projected trends under the No-Action Alternative. These reductions and increases in emissions would vary by pollutant, calendar year, and action alternative. The differences in national emissions of criteria air pollutants among the action alternatives compared to the No-Action Alternative would range from less than 1 percent to about 11.7 percent. Adverse health outcomes from criteria pollutant emissions are expected to increase nationwide in 2035 and 2050 under all action alternatives relative to the No-Action Alternative. This is primarily due to increases in downstream emissions, particularly of VOC and CO. The increases in health effects would stay the same or get smaller from Alternatives 1 and 2 to Alternative 5 in 2035 and 2050, reflecting the generally greater stringency of Alternative 5. However, emissions decrease over time under each action alternative.

Toxic air pollutant emissions would remain the same or increase in 2035 and 2050 for all action alternatives relative to the No-Action Alternative. The largest relative increases in emissions generally would occur for formaldehyde for which emissions would increase by as much as 12.6 percent under Alternatives 1 and 2 in 2050 compared to the No-Action Alternative. Percentage increases in emissions of acetaldehyde, acrolein, 1,3-butadiene, benzene, and diesel particulate matter (DPM) would be less. The smaller increases are not expected to lead to measurable changes in concentrations of toxic air pollutants in the ambient air. For such minor changes, the impacts of those action alternatives would be essentially equivalent. Larger increases in emissions could lead to changes in ambient pollutant concentrations.

Overall changes in health effects due to air pollution are expected to be consistent with any resulting emissions trends. Higher emissions would be expected to lead to an overall increase in adverse health effects while lower emissions would be expected to lead to a decrease in adverse health effects. The changes in health effects due to changes in emissions also are dependent on geographic population distribution, meteorological and topographical conditions, and people's proximity to roadways and upstream facilities.

The final rule and alternatives would result in slight increases in CO2 concentrations, surface temperature, sea-level, and precipitation, and a slight decrease in ocean pH compared to the No- Action Alternative, based on projections using a reduced-complexity climate model. They also could, to a small degree, increase the impacts and risks of climate trends. A great deal of uncertainty exists regarding the magnitude of impact on these climate variables, as well as to the impacts and risks of climate trends. The impacts of the final rule and alternatives on global mean surface temperature, precipitation, sea-level, and ocean acidification would be very minor in relation to global emissions trajectories. This is because of the global and multi-sectoral nature of climate trends. Any impacts also would occur on a global scale and would not affect the United States disproportionately. To put these emissions changes in perspective, the emissions increase from all passenger cars and light trucks in 2035 compared with emissions under the No-Action Alternative are approximately equivalent to the annual emissions from 17,806,954 vehicles under Alternative 3, the Preferred Alternative. For reference, a total of 252,733,312 passenger cars and light trucks are projected to be on the road in 2035 under the No-Action Alternative.\1178\

\1178\ The light-duty vehicle equivalency is based on an average per[hyphen]vehicle emissions estimate, which includes both tailpipe CO2 emissions and associated upstream emissions from fuel production and distribution. MOVES, the GREET model, and EPA analysis project that the average light-duty vehicle will account for 4.66 metric tons of CO2 emissions in 2035.

In cases where quantitative impacts assessment was not possible, NHTSA presented the findings of a literature review of scientific studies for informational purposes.

Some commenters argued that the environmental analysis in the Draft SEIS is incomplete or incorrectly assessed in various ways.\1179\ For example, commenters argued that the Draft SEIS did not consider the potential effect of the retroactive generation of additional compliance credits resulting from this rule, or that it understated the impacts

of changes in criteria and non-criteria air emissions.\1180\ Comments regarding the scope of environmental analysis are addressed in Section V.B.2 above, while those regarding the results of the environmental analysis are addressed in Appendix C of the Final SEIS.

\1179\ NRDC et al., Docket No. NHTSA-2025-0491-5948, at 4-10; Daniel Anderson, Docket No. NHTSA-2025-0491-5042.

\1180\ See, e.g., NRDC et al., Docket No. NHTSA-2025-0491-5948, at 4-10. Additional comments about the scope of the environmental analysis are addressed in Appendix C of the Final SEIS.

The Final SEIS is one factor that informed NHTSA's decision-making process to set CAFE standards. NHTSA evaluated the range of reasonable alternatives in the Final SEIS, along with other factors during the rulemaking process and determined that Alternative 3 is the Preferred Alternative because it is maximum feasible. NHTSA took a hard look at the results of the Final SEIS in arriving at its conclusion that Alternative 3 is maximum feasible.

For the reasons discussed above, NHTSA concludes that its authority to finalize and implement CAFE standards for MYs 2022-2026 and 2027- 2031 is well-supported in law and practice. NHTSA also concludes that its exercise of authority reflects sound policy.

In the proposal, NHTSA stated that if any portion of the rule is declared invalid, the agency intended the various aspects of the rule to be severable and, specifically, that each set of standards, for MYs 2022-2026 and MYs 2027-2031, be severable, as well as the various compliance proposals. NHTSA discussed that the standards for MYs 2027- 2031 could be implemented independently if any of the other years' standards were struck down, and the agency believed that it would be in the best interest of the Nation for the standards to be applicable to support EPCA's overarching purpose of energy conservation. NHTSA stated that each standard was justified independently on both legal and policy grounds and could be implemented effectively by the agency.

The agency received a variety of comments regarding whether the different provisions and standards within the proposed rule are severable from one another in the event of a legal challenge. PMI recommended that NHTSA include express severability clauses in the regulatory text for distinct components of the rule to reduce legal risk and ensure the reforms are durable.\1181\ It detailed four specific areas that should function independently: first, the retroactive corrections for MYs 2022 through 2026 are logically and legally distinct from the prospective 2027 through 2031 standards, as the former corrects a specific legal error regarding the inclusion of electric vehicles, while the latter represents a forward-looking policy judgment about maximum feasibility; second, the proposed regulatory reclassification of light trucks based on functional utility serves the independent statutory purpose of preventing regulatory arbitrage and should remain in effect even if the numeric stringency targets are vacated; third, the elimination of the credit trading program is a discrete policy choice that is permitted, but not required, by the statute, and this decision to remove a distortive cross-subsidy stands on its own merits; and fourth, PMI urged NHTSA to explicitly state that its stringency levels are justified independently by economic practicability and energy conservation considerations, ensuring the standards would survive even if courts later reject the agency's statutory interpretation barring the consideration of electric vehicles under subsection 32902(h).\1182\

\1181\ PMI, Docket No. NHTSA-2025-0491-5001-A2, at 56.

\1182\ Id. at 56-7.

The Alliance also supported the agency's claim that the proposed standards for MYs 2022 through 2026 are severable from the standards for MYs 2027 through 2031, noting that the agency appropriately conducted two separate analyses for these periods.\1183\ However, the Alliance diverged from PMI regarding the vehicle reclassification proposal, arguing that these provisions should not be severable from the model years to which they apply.\1184\ They explained that reclassifying many SUVs and minivans as passenger cars subjects those vehicles to an unrevised passenger car fleet standard that was never designed for or evaluated with those heavier vehicles in mind.\1185\ Consequently, the Alliance argued that, if the revised standards for MYs 2028 and later are struck down, the vehicle reclassification provisions must also be struck down.\1186\

\1183\ The Alliance, Docket No. NHTSA-2025-0491-5707-A2, at II- 8.

\1184\ Id.

\1185\ Id.

\1186\ Id.

Several other commenters, including NRDC et al., ZETA, and an individual commenter, opposed the assertion that the rule's provisions are severable.\1187\ These commenters argued that the proposed rule is intended to operate as a single, integrated whole and that its various components are interdependent and would not function sensibly in isolation. A primary objection from these commenters was that the standards for MYs 2027 through 2031 are inextricably linked to the standards for MYs 2022 through 2026.\1188\ NRDC et al. and the individual commenter noted that the later standards are explicitly based on the earlier ones, with each year providing a fixed percentage increase--specifically 0.5 percent followed by 0.25 percent per year-- building off the maximum feasible “foundation” of the revised 2022 standards, with a “bridge” year in 2027.\1189\ NRDC et al. emphasized that if the MYs 2022-2026 standards are vacated, the existing, much more stringent standards for those years would automatically go back into effect.\1190\ NRDC et al. continued to state that because a 0.25- percent increase from those higher baseline levels would result in entirely different standards than what NHTSA proposed, the agency has not demonstrated it would have adopted the same 2027 through 2031 standards under those circumstances.\1191\ The individual commenter further noted that a new round of analysis and notice and comment would be required if earlier standards are invalidated.\1192\

\1187\ NRDC et al., Docket No. NHTSA-2025-0491-5928-A2, at 111- 112; ZETA, Docket No. NHTSA-2025-0491-6039-A1, at 11-12; S. Sotomayor, Docket No. NHTSA-2025-0491-4888.

\1188\ Id.

\1189\ NRDC et al., Docket No. NHTSA-2025-0491-5928-A2, at 111- 112; S. Sotomayor, Docket No. NHTSA-2025-0491-4888.

\1190\ NRDC et al., Docket No. NHTSA-2025-0491-5928-A2, at 111- 112.

\1191\ Id.

\1192\ S. Sotomayor, Docket No. NHTSA-2025-0491-4888.

Finally, NRDC et al. and ZETA opposed the contention that other policy choices in the rule, such as the elimination of credit trading and the reclassification of vehicle fleets, are discrete and severable provisions.\1193\ ZETA argued that the elimination of the credit trading program is directly predicated on NHTSA's new approach to the baseline.\1194\ NRDC et al. similarly contended that the agency has advanced a single, integrated proposal where these compliance and enforcement changes are combined with the elimination of purportedly unlawful considerations, rather than discrete policy choices that can be cleanly severed.\1195\

\1193\ NRDC et al., Docket No. NHTSA-2025-0491-5928-A2, at 111- 12; ZETA, Docket No. NHTSA-2025-0491-6039-A1, at 11-12.

\1194\ ZETA, Docket No. NHTSA-2025-0491-6039-A1, at 11-12.

\1195\ NRDC et al., Docket No. NHTSA-2025-0491-5928-A2, at 111- 112.

NHTSA has carefully considered the comments regarding the severability of

the various provisions within this final rule. The agency agrees with PMI and the Alliance that each part of this regulatory action is legally and logically distinct, and as stated in the proposal and reaffirmed here, it is the agency's express intent that these provisions be treated as severable. Specifically, the corrections for MYs 2022-2026 are intended to rectify a specific legal error regarding the improper inclusion of prohibited factors under subsection 32902(h), while the standards for MYs 2027-2031 represent a separate, forward- looking exercise of the agency's discretion to determine maximum feasible levels based on the capability of vehicles powered by gasoline or diesel fuel, as defined by the statute. Moreover, the standards for MYs 2027-2031 were selected using a MY 2024 reference fleet and a forward-looking baseline, both unconnected mathematically to the MYs 2022-2026 standards. These two parts of the rule serve distinct functions and are based on independent analyses and legal justifications. NHTSA believes that the invalidation of one phase of the rule should not affect the continued validity of the other, as the agency would have adopted the MYs 2022-2026 revisions to align with the law regardless of its policy choices for future model years; conversely, NHTSA would have adopted the MYs 2027-2031 amendments regardless of the level of standards for MYs 2022-2026.

Regarding PMI's comment to state explicitly that the stringency levels are justified independently by economic practicability and energy conservation considerations regardless of whether a court finds NHTSA's application of the subsection 32902(h) factors appropriate, NHTSA cannot do so because such a determination would be based on factors that subsection 32902(h) explicitly bars the agency from considering when setting standards. The balance of external factors that the agency can consider, for example the nation's status as a net petroleum exporter, the significant increase in new vehicle transaction prices, and diminishing fuel savings from adding fuel-economy-improving technologies as the vehicle fleet gets more efficient, all point to a standards reset being appropriate.

Regarding the comments on various compliance proposals, NHTSA maintains that the new vehicle classification definitions can remain in the regulatory text as-is; however, NHTSA agrees with the Alliance that the agency must carefully consider the feasibility of standards based on the vehicles included in each regulatory class. The corrected definitions of passenger and non-passenger automobiles are valid exercises of the agency's authority to define vehicle categories independent of the specific numeric standards applied to them. NHTSA maintains that the updated vehicle classification definitions rest on independent legal justifications and can remain in the regulatory text even if a court finds that the numeric standards for those model years are not maximum feasible. Should standards for any particular model year be vacated, the agency would reassess and establish replacement standards using either the previous or updated classification framework based on a fresh evaluation of what constitutes reasonable lead time. With regard to compliance proposals, the decision to eliminate the credit trading program is a discrete one that is not dependent on the specific stringency levels or the baseline methodology adopted elsewhere in the rule. This is particularly important given the agency's application of subsection 32902(h), which precludes consideration of credit trading, transferring, or availability, to its standard-setting methodology.

NHTSA disagrees with the comments from NRDC et al., ZETA, and others that the rule is an indivisible, integrated whole that cannot function in isolation. While the prospective standards for MYs 2027- 2031 are designed to follow the revised MYs 2022-2026 standards, the agency's choice of annual stringency increases reflects a deliberate policy judgment about the appropriate rate of technological progress for the internal combustion engine fleet. If a court were to vacate the MYs 2022-2026 revisions, the agency's decision to pursue modest, incremental increases in subsequent years would remain a valid and reasonable application of the statutory factors of economic practicability and technological feasibility. Moreover, a return to the prior, more stringent baseline for MYs 2022-2026 would not automatically render the MYs 2027-2031 percentage increases non- sensical, as the MYs 2027-2031 standards were set using the prior rule's standards for MYs 2024-2026 as the baseline, and not the proposed correction to MY 2022-2026 standards.

The foundational legal interpretations, vehicle classification reforms, and specific stringency targets of this rule each rest on independent justifications. Therefore, each of these components is intended to survive independently of the others.

NHTSA's CAFE enforcement program is largely established by EPCA, as amended by EISA, and is prescriptive regarding enforcement. EPCA and EISA also establish a number of flexibilities and incentives available to manufacturers to help them comply with the CAFE standards. The statute also authorizes NHTSA to establish, at its discretion, additional flexibilities by regulation. The light-duty CAFE program includes all vehicles with a GVWR of 8,500 pounds or less as well as vehicles between 8,501 and 10,000 pounds classified as medium-duty passenger vehicles (MDPVs).1196 1197

Table VI-1 provides an overview of the CAFE program, including statutory and regulatory citations, and an overview of the changes proposed and finalized in this rulemaking.

\1196\ As prescribed in 49 U.S.C. 32901(a)(19)(B), an MDPV is “defined in section 86.1803-01 of title 40, Code of Federal Regulations, as in effect on the date of the enactment of the Ten- in-Ten Fuel Economy Act.” In accordance with the statutory definition, NHTSA defines MDPV at 49 CFR 523.2 as any complete or incomplete motor vehicle rated at more than 8,500 pounds GVWR and less than GVWR that is designed primarily to transport passengers, but does not include a vehicle that: (1) Is an “incomplete truck” meaning any truck that does not have the primary load carrying device or container attached; or (2) Has a seating capacity of more than 12 persons; or (3) Is designed for more than nine persons in seating rearward of the driver's seat; or (4) Is equipped with an open cargo area (for example, a pickup truck box or bed) of 72.0 inches in interior length or more. A covered box not readily accessible from the passenger compartment will be considered an open cargo area for purposes of this definition.

\1197\ See “heavy-duty vehicle” definition in 40 CFR 86.1803- 01. MDPVs are classified as either passenger automobiles or light trucks depending on whether they meet the criteria to be a non- passenger automobile under 49 CFR 523.5. If the MDPV is classified as a non-passenger automobile by meeting the requirements in 49 CFR 523.5, it is subject to the requirements in 49 CFR part 533. If the MDPV does not meet the criteria in 49 CFR 523.5 to be a non- passenger automobile, then it is classified as a passenger automobile and subject to the requirements in 49 CFR part 531.

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In general, as required by EPCA, NHTSA sets fleet average fuel economy standards for light-duty vehicles on an mpg basis. As specified in EPCA, light-duty vehicles are separated into three separate compliance categories: passenger automobiles manufactured domestically (referred to as domestic passenger cars), passenger automobiles not manufactured domestically (referred to as imported passenger cars), and non-passenger automobiles (which are also referred to as light trucks).\1198\ Each standard applies to a manufacturer's compliance category as a whole and not to individual vehicles, and a manufacturer can balance the performance of their vehicles (via the application of fuel-saving technology) in complying with standards. NHTSA sets standards based on vehicle footprint (i.e., the area calculated by multiplying the wheelbase times the track width), and each manufacturer must comply with the fleet average standard derived from their vehicles' target standards. These target standards are taken from a set of mathematical functions for each fleet. Although NHTSA sets the standards for light-duty vehicles, EPA, as authorized and directed by EPCA, establishes procedures for calculating a manufacturer's average fuel economy for CAFE compliance. Average fuel economy values are based on vehicle testing conducted using the FTP (or

“city” test) and HFET (or “highway” test).\1199\

\1198\ 49 U.S.C. 32903(g)(6)(B).

\1199\ 40 CFR part 600.

At the end of each model year, EPA determines the fleet average fuel economy performance for the individual fleets in accordance with procedures set forth in 40 CFR part 600. NHTSA then confirms whether a manufacturer's fleet average fuel economy performance for each of its compliance categories of light-duty vehicles meets the applicable target-based fleet standard. NHTSA makes its final determination of whether a manufacturer has met its CAFE compliance obligation based on official reported and verified CAFE data received from EPA. Pursuant to 49 U.S.C. 32904(e), EPA is responsible for calculating manufacturers' CAFE values so that NHTSA can determine compliance with its CAFE standards. A manufacturer's final model year report must be submitted to EPA no later than May 1st following the end of the model year.\1200\ EPA verifies the data submitted by manufacturers and issues final CAFE reports that are sent to manufacturers and to NHTSA electronically between April and October of the calendar year following the end of model year. NHTSA then assesses each manufacturer's compliance for each of their fleets and calculates each manufacturer's credit amounts (credits for vehicles exceeding the applicable CAFE standard) and shortfalls (amount by which a fleet fails to meet the applicable CAFE standards). A manufacturer meets NHTSA's fuel economy standard if its fleet average performance is greater than or equal to its required standard.

\1200\ 40 CFR 600.512-12(b).

If one or more of a manufacturer's compliance categories fails to meet its fuel economy standard, NHTSA will provide written notification to the manufacturer that it has not met the standard. The written notification will also include the shortfall amount for each compliance category, which is calculated using the following equation: (Fuel Economy Achieved - Fuel Economy Standard) x 10 x Production Volume.\1201\ To determine the civil penalty amount, NHTSA multiplies the total shortfall (in credits) by the applicable civil penalty rate.\1202\ When the manufacturer receives the written notification, it is required to confirm the shortfall amount and submit a plan indicating how it will allocate existing credits or earn, transfer, or acquire credits to apply toward the shortfall, or inform NHTSA of its intention to pay a civil penalty to resolve the shortfall.1203 1204 The manufacturer must submit a plan or applicable civil penalty payment within 60 days of receiving the written notification from NHTSA. Credit allocation plans and carryback plans (i.e., plans to use future earned or acquired credits to apply toward the shortfall) received from the manufacturer will be reviewed by NHTSA, and NHTSA will approve a credit allocation plan unless it finds the proposed credits are unavailable or that it is unlikely that the plan will result in the manufacturer earning sufficient credits to offset the shortfall. If a plan is rejected, NHTSA will notify the manufacturer and request a revised plan.

\1201\ 49 U.S.C. 32903(c).

\1202\ For MY 2022 and beyond the applicable civil penalty rate is $0. Public Law 119-21 (OB3), 139 Stat. 72 (July 4, 2025).

\1203\ In accordance with 49 U.S.C. 32903(g)(3)(C), the maximum increase in any compliance category attributable to transferred credits is 2.0 mpg.

\1204\ In accordance with 49 U.S.C. 32903(f)(2) and (g)(4), manufacturers are restricted from using traded and transferred credits to resolve MDPCS shortfalls.

NHTSA received several comments on issues related to those discussed in this section, such as the transfer of credits and the statutory cap on the transfer of credits between compliance categories within a manufacturer's fleet; these discussions, while relevant to the CAFE program, are outside of NHTSA's authority. Honda commented that it supports manufacturers' ability to transfer credits between their own compliance fleets.\1205\ JLR, UCS, and Volkswagen commented on the 2- mpg transfer credit cap between compliance fleets.\1206\ Volkswagen commented that NHTSA should remove the transfer cap and allow manufacturers to use all their earned credits.\1207\ JLR commented that the transfer cap has become increasingly restrictive, considering the proposed changes to vehicle classification.\1208\ UCS commented that capping credit transfers means that marginal compliance costs have a component related to fleet mix, which can lead to credit imbalances among manufacturers.\1209\

\1205\ Honda, Docket No. NHTSA-2025-0491-6013, at 8.

\1206\ JLR, Docket No. NHTSA-2025-0491-5196, at 4; UCS, Docket No. NHTSA-2025-0491-6027-A1, at 30; Volkswagen, Docket No. NHTSA- 2025-0491-5036-A1, at 2.

\1207\ Volkswagen, Docket No. NHTSA-2025-0491-5036, at 2.

\1208\ JLR, Docket No. NHTSA-2025-0491-5196, at 4.

\1209\ UCS, Docket No. NHTSA-2025-0491-6027, at 30.

In response to these comments, NHTSA notes that the cap on the transfer of credits between compliance categories within a manufacturer's fleet is set by statute at 49 U.S.C. 32903(g)(3). NHTSA cannot adjust the transfer cap in a manner that is inconsistent with the statute. For the final rule, NHTSA is not making any changes to the existing provisions regarding transferring credits between compliance categories. In accordance with the statute, credits transferred may only be used to improve a compliance category's fuel economy performance by up to 2 mpg.

AVE recommended that NHTSA use the 5-cycle test procedure, not the 2-cycle test procedure, to measure fuel economy.\1210\ AVE commented that, in addition to providing improved measurement that better reflects real-world performance, using the 5-cycle test procedure will align NHTSA's fuel economy values with EPA's emission values. AVE also requested that NHTSA align its test procedures with EPA's test procedures to provide consistent well-defined test cycle results, in particular for hybrid-electric powertrain technologies whose performance can vary based on test cycle assumptions.\1211\

\1210\ AVE, Docket No. NHTSA-2025-0490-0033, at 6.

\1211\ AVE, Docket No. NHTSA-2025-0490-0033, at 7.

NHTSA does not have the authority to modify the testing procedures used to calculate a manufacturer's average fuel economy values. EPCA, as amended by EISA, provides EPA with the authority to calculate the average fuel economy of a manufacturer's compliance fleet. NHTSA has no role in determining the testing and calculation procedures prescribed by EPA.\1212\

\1212\ 49 U.S.C. 32904(a).

Porsche commented on the way NHTSA amends regulatory text.\1213\ Porsche recommended that NHTSA keep the original section number and `reserve' sections and subsections containing provisions that are removed. Porsche states that doing so will maintain consistency with other regulations that may reference them.

\1213\ Porsche, Docket No. NHTSA-2025-04901-0044, at 4.

While NHTSA appreciates Porsche's comment, NHTSA does not agree that it should change the way it amends regulatory text. While NHTSA endeavors to check cross-references for all the provisions it amends, the agency acknowledges the possibility that a cross-reference may be missed. NHTSA does not believe however, that this possibility warrants `reserving' sections and subsections that contain provisions that are amended. Doing so could add unnecessary paragraphs to the text and would not ensure that all cross-references are updated appropriately.

Instead, NHTSA would seek to address any outdated cross-references in the context of a technical amendment and encourages manufacturers to notify NHTSA if they find any in the text. Given these factors, NHTSA is finalizing amendments to the regulatory text using the same methods as the NPRM.

NHTSA is amending the criteria for non-passenger automobiles. This final rule is informed by an examination of how NHTSA's vehicle classification criteria in 49 CFR part 523, Vehicle Classification, align with and implement the vehicle definitions in 49 U.S.C. 32901.

This is not the first time NHTSA has examined vehicle classification; in its 2010 and 2012 final rules, NHTSA considered amending its vehicle classification regulations but decided to monitor and revisit them in future rulemakings.1216 1217 Notably, NHTSA stated that “no one can predict with certainty how the market will change between now and 2025” specifically regarding how vehicle manufacturers may “make more deliberate redesign efforts to move vehicles out of the car fleet and into the truck fleet in order to obtain the lower target.” \1218\ It is now 2026, and NHTSA has finalized an updated analysis using current fleet data.

\1216\ 75 FR 25661 (May 7, 2010).

\1217\ 77 FR 63124 (Oct. 15, 2012).

\1218\ 77 FR 63122 (Oct. 15, 2012).

The starting point of NHTSA's analysis was a recognition of the market shift from passenger automobiles to non-passenger automobiles (as currently classified) in the light-duty vehicle market. In 1975, non-passenger automobiles represented 19.3 percent of the light-duty automobile market \1219\ and now make up 64.7 percent.\1220\ Figure VI- 1 below illustrates the year-over-year light-duty fleet shares of passenger automobiles and non-passenger automobiles over the last 50 model years (i.e., from 1975 to 2024).

\1219\ DOE, Composition of New U.S. Light-Duty Vehicles by Vehicle Type, last revised: Jan. 2024, available at: https://afdc.energy.gov/data/10306 (accessed: June 5, 2026).

\1220\ This is based on MY 2024 mid-model year reporting and includes dedicated alternative fuel automobiles. Considering only vehicles that are powered by internal combustion engines, the share of automobiles classified as non-passenger automobiles is 67.9 percent.

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Leading up to the 2010 and 2012 final rules, there was no clear year-over-year trend in the share of each fleet, but the fleet composition has since continued the long-term trend towards non- passenger automobiles. Based on its new analysis, NHTSA believes that the criteria it uses to delineate between the fleets need to be changed in concurrence with resetting of stringencies, to ensure that the classification of the fleets meets the intent of EPCA. These changes and the processes by which they were evaluated are described in detail in the subsequent paragraphs and sections.

To assess how the current criteria in section 523.5 of NHTSA's regulations align with the statutory definitions and intent, NHTSA conducted an analysis beginning with the compiled classification data from manufacturers' MY 2024 mid-model year fuel economy compliance reports.\1221\ To supplement this information, NHTSA conducted extensive research using publicly available manufacturer publications, such as owner's manuals, marketing brochures, and specification sheets,\1222\ to develop a comprehensive dataset of vehicle models and any non-passenger automobile criteria that each vehicle model meets. This additional research was necessary, as manufacturers' mid-model year reports generally provide only the minimum data required to demonstrate qualification as a non-passenger automobile. For example, for a three-row SUV that qualifies as a non-passenger automobile via 49 CFR 523.5(a)(5), the manufacturer may not provide data on off-highway angles and clearances specified in 49 CFR 523.5(b)(2). Incorporating additional market research data made it possible for NHTSA to check all possible regulatory pathways that could qualify a vehicle as a non- passenger automobile. A detailed discussion of how the MY 2024 analysis fleet dataset was developed and used can be found in Final TSD Chapter 2.7.\1223\ NHTSA has updated this data set since publishing the NPRM, based on comments and supporting material submitted by manufacturers, to fill in missing data and to correct errors in the dataset.

\1221\ As required in 49 CFR 537.7(c)(5).

\1222\ The catalog of reference specification sheets (broken down by manufacturer, by nameplate) used to populate and confirm missing information for vehicle reclassification is available on NHTSA's website. BMW Data, Ferrari Data, FCA Data, Ford Data, Hyundai Data, Ineos Data, Kia Data, Mazda Data, Mercedes Data, Nissan Data, Subaru Data, Toyota Data, Volvo Data, GM Data, Honda Data, Mitsubishi Data, VW Data, and JLR Data.

\1223\ See Non-Passenger_Analysis.xlsx, Docket No. NHTSA-2025- 0491 for the complete dataset used in the analysis.

Based on the NPRM analysis, several commenters expressed support for the concept of reclassification but suggested that the method by which the changes were being introduced was intended only to reduce the stringency of both the passenger automobile and non-passenger automobile fleet.\1224\ The observation that the stringency of each fleet decreases at most footprints is correct when looking at each fleet individually; however, overall compliance is assessed as the weighted average of both the passenger

automobile and non-passenger automobile fleets. While the compliance target of the passenger automobile footprint fuel economy curve decreases for most footprint sizes due to the reclassified fleet, it remains higher than the equivalent footprint fuel economy targets for a non-passenger automobile despite the fact that those targets will now apply to heavier vehicles, such as AWD crossovers previously subject to non-passenger automobile targets. Accordingly, while the overall stringency of each fleet decreases, the number of vehicles, and therefore the weighting, of the passenger automobile fleet is greater after the changes to classification criteria are applied. The resulting attribute-based fuel economy targets were not based on any reclassification effort to reduce or otherwise change the standards for each fleet, but are simply a product of the curve-setting analysis based on the composition of each fleet before and after reclassification. Further discussion of the fuel economy curve development can be found in preamble Section II.B.

\1224\ Cleveland, Docket No. NHTSA-2025-0491-4840, at 12; NACAA, Docket No. NHTSA-2025-0491-5884, at 12.

Commenters also observed that these changes provide “no stringency benefit at fleet level” or changes to overall fleet efficiency.\1225\ This assessment is correct. As discussed throughout this preamble section, NHTSA's classification criteria, established in 1977 and based on a 1975 baseline fleet, have resulted in manufacturers' making design decisions, not in response to consumer demand, but to qualify vehicles as non-passenger automobiles. NHTSA's reclassification in this final rule, however, does not require manufacturers to remove or to redesign any feature or characteristics associated with the existing vehicle classification criteria, nor does it require a change to the existing utility or capability of the impacted vehicles. Instead, NHTSA is removing a regulatory incentive to add features that vehicle purchasers may not desire.

\1225\ CALSTART, Docket No. NHTSA-2025-0491-6042-A1, at 4.

Based on this analysis, NHTSA is amending the criteria for non- passenger automobiles to align with the best reading of the statute. These changes are discussed in detail in the following sections. a. Non-Passenger Automobile Definition

EPCA requires NHTSA to set separate maximum feasible standards for “passenger automobiles” and “non-passenger automobiles.” All vehicles in the light-duty fleet are classified into one of these two categories based on the presence or lack of certain vehicle characteristics and features. At 49 U.S.C. 32901(a)(17), EPCA defines a non-passenger automobile as “an automobile that is not a passenger automobile or a work truck.” By statute, the definition of non- passenger automobile is linked to the definition of passenger automobile found at 49 U.S.C. 32901(a)(18). A passenger automobile is a vehicle that NHTSA “decides by regulation is manufactured primarily for transporting not more than 10 individuals, but does not include an automobile capable of off-highway operation” that NHTSA decides by regulation “has a significant feature (except 4-wheel drive) designed for off-highway operation” and “is a 4-wheel drive automobile or is rated at more than 6,000 pounds gross vehicle weight.” In accordance with the statute, NHTSA has issued regulations at 49 CFR part 523 to establish criteria for determining whether a vehicle is a passenger automobile or non-passenger automobile. Under EPCA and NHTSA's regulations, there are three primary pathways for an automobile (i.e., a vehicle under 10,000 pounds GVWR that is not a work truck) to be classified as a non-passenger automobile: (1) the automobile is designed to carry more than ten individuals; (2) the automobile is not manufactured primarily for transporting individuals; or (3) the automobile is capable of off-highway operation. NHTSA is finalizing changes to the criteria used to classify non-passenger automobiles via the second and third pathways.\1226\ These finalized changes are discussed in detail in the following sections.

\1226\ The first criterion is set in statute and NHTSA thus does not have authority to change it by regulation. While the third criterion is also set in statute, EPCA (as amended by EISA) provides the Secretary of Transportation with the flexibility to decide by regulation a significant feature (except 4-wheel drive) indicating that the automobile was designed for off-highway operation.

ICCT's comments endorsed a single regulatory category and attribute-based fuel economy curve to encompass the entire light-duty automobile fleet.\1227\ This recommendation, however, is precluded by statute. EPCA directs NHTSA, by delegation, to evaluate and regulate passenger automobiles and non-passenger automobiles separately.

\1227\ ICCT, Docket No. NHTSA-2025-0491-5240-A1, at 9.

In the NPRM, NHTSA proposed that classification changes would take effect in MY 2028. Commenters who expressed support for the proposed changes did not provide specific rationale for why MY 2028 was a suitable year to introduce these changes, nor did they provide comment or supporting information endorsing or opposing the implementation of the vehicle classification changes in an alternative year.\1228\ NHTSA received several comments requesting that NHTSA delay implementation of the new vehicle classifications, most of which were from commenters who also expressed concerns about the proposed changes.\1229\ Several manufacturers and manufacturer-representing trade groups provided comments stating that MY 2028 did not provide sufficient lead time for manufacturers to respond to the classification changes with design changes to their vehicles or fleets.\1230\ A subset of these commenters argued that NHTSA's analysis was incomplete and recommended delaying reclassification indefinitely.\1231\ Comments also noted NHTSA's statutory 18-month lead time constraint,\1232\ suggesting that reclassified vehicles would be subject to more stringent standards without sufficient notice.\1233\ Some comments also raised concerns over the use of NHTSA's passenger automobile and non-passenger automobile definitions for regulatory purposes by other agencies, including EPA in its regulation of criteria emissions, evaporative emissions, and cold temperature carbon monoxide (CO) emissions and IRS in its implementation of the gas guzzler tax under 26 CFR 48.4064- 1.\1234\

\1228\ AVE, Docket No. NHTSA-2025-0490-0033-A1, at 7-8; Cleveland, Docket No. NHTSA-2025-0491-4840, at 13; MECA, Docket No. NHTSA-2025-0491-5331, at 14; PMI, Docket No. NHTSA-2025-0491-5001- A2, at 20.

\1229\ Porsche, Docket No. NHTSA-2025-0490-0044-A1, at 2; North American Subaru, Inc. Docket No. NHTSA-2025-0490-0037-A1, at 6.

\1230\ Porsche, Docket No. NHTSA-2025-0490-0044-A1, at 2; Subaru, Docket No. NHTSA-2025-0490-0037-A1 at 6.

\1231\ CALSTART, Docket No. NHTSA-2025-0491-6042-A1, at 3-4.

\1232\ 49 U.S.C. 32902(g)(2).

\1233\ Subaru, Docket No. NHTSA-2025-0490-0037-A1, at 6; Stellantis, Docket No. NHTSA-2025-0491-5968-A1, at 6; Kia, Docket No. NHTSA-2025-0491-5123-A1, at 4.

\1234\ Porsche, Docket No. NHTSA-2025-0490-0044-A1, at 4; Stellantis, Docket No. NHTSA-2025-0491-5968-A1 at 6; The Alliance, Docket No. NHTSA-2025-0491-5707-A1, at 6.

In response to these comments, NHTSA provides specific supporting information showing a complete and conclusive analysis for each change in preamble Sections VI.B.1.b and VI.B.1.c below.

In response to comments asserting that classification-specific design considerations are necessary for manufacturers to implement before the changes take effect, NHTSA refers commenters and other interested parties to preamble Section II.B for a complete

description of how the attribute-based fuel economy curves were established and to preamble Section V for a discussion on maximum feasibility. NHTSA notes that the CAFE Model does not consider any of these design features or characteristics, and there is no inherent change in the actual utility or capability of the vehicles that move from non-passenger automobiles to passenger automobiles. The fuel economy curves before and after reclassification are both evaluated using the same methodology. NHTSA recognizes, however, that some manufacturers may have vehicles shift from the non-passenger automobile fleet to the passenger automobile fleet due to reclassification, and these manufacturers may need additional time to evaluate how this change may affect their compliance position.

To give manufacturers time to adjust their compliance positions, all changes to vehicle classification under 49 CFR 523.5 will take effect in MY 2030. NHTSA is aware of the use of its passenger automobile and non-passenger automobile (i.e., passenger car and light truck, respectively) definitions by other agencies and pertaining to other regulations. Notably, EPA intends to use the non-passenger automobile criteria that NHTSA is proposing to amend at 49 CFR 523.5 to define “Light-duty truck” beginning in 2029.\1235\ EPA is proposing Tier 4 revisions for PM,\1236\ CO and HCHO,\1237\ and NMOG+NOX \1238\ standards, which by MY 2030 are the same regardless of light-duty vehicle (i.e., passenger automobile) or light- duty truck (i.e., non-passenger automobile) designation. Evaporative emission standards are proposed to remain at Tier 3 levels.\1239\ The relevant IRA excise tax is codified in regulation by the IRS \1240\ and states that “[a]n automobile does not include a non-passenger automobile as defined in regulations in effect on November 9, 1978 (49 CFR 523.5 (1978)), which were prescribed by the Secretary of Transportation for section 501 of the Motor Vehicle Information and Cost Savings Act (15 U.S.C. 2001).” While the interpretation, implementation, and consideration of this language is beyond the purview of NHTSA's authority or mandate, the specific regulation date means that any changes to the definition of a non-passenger automobile made after November 9, 1978 will have no impact or bearing on that vehicle's tax inclusion or exemption under 26 CFR 48.4064-1. To afford manufacturers additional time to adjust to the changes in vehicle classification criteria, NHTSA is delaying the implementation of all classification changes by two model years relative to the NPRM. All changes to vehicle classification under 49 CFR 523.5 will take effect in MY 2030.

\1235\ 91 FR 28481 (May 18, 2026).

\1236\ 91 FR 28468 (May 18, 2026).

\1237\ 91 FR 28468 (May 18, 2026).

\1238\ 91 FR 28469 (May 18, 2026).

\1239\ 91 FR 28481 (May 18, 2026).

\1240\ 26 CFR 48.4064-1(b)(3)(iv).

The third pathway at 49 CFR 523.5 for classification as a non- passenger automobile includes any automobile “capable of off-highway operation” that NHTSA decides by regulation: (1) “has a significant feature (except 4-wheel drive) designed for off-highway operation” and (2) “is a 4-wheel drive automobile or is rated at more than 6,000 pounds gross vehicle weight.” \1241\ Through rulemaking, NHTSA determined that “high ground clearance” would constitute a feature designed for off-highway operation and derived a specific list of dimensions that comprise high ground clearance.\1242\ Specifically, the regulation requires automobiles to meet minimum prescribed values for four out of the following five dimensions: running clearance, axle clearance, approach angle, breakover angle, and departure angle. When issuing these criteria, NHTSA explained that the agency arrived at these values “[a]fter comparing the ground clearance of automobiles used on highways only with automobiles used off as well as on the highway.” \1243\ In the 1977 final rule, NHTSA noted that Ford and International Harvester commented that the five ground clearance measurements proposed in the 1976 NPRM would distinguish automobiles capable of off-highway operation from other automobiles. The agency also stated that “[i]f a need arises in the future to establish additional criteria, the NHTSA will initiate rulemaking.” \1244\ After almost 50 years, NHTSA has re-evaluated whether the criteria appropriately differentiate between vehicles that are and are not capable of off-highway operation. After conducting an analysis using the MY 2024 fleet, NHTSA is finalizing two changes to the existing standard for determining high ground clearance, discussed in detail below. Together, these changes align NHTSA's criteria for off-highway capability with statutory intent.

\1241\ 49 U.S.C. 32901(a)(18).

\1242\ 41 FR 55371 (Dec. 20, 1976).

\1243\ 41 FR 55371 (Dec. 20, 1976).

\1244\ 42 FR 38367 (July 28, 1977).

In the NPRM, NHTSA proposed eliminating axle clearance as a characteristic used to define a vehicle with high ground clearance and requiring that vehicles classified as non-passenger automobiles via the off-highway pathway meet the prescribed thresholds for all four of the remaining characteristics that comprise the high ground clearance feature. NHTSA asserted that the objective of high ground clearance as an off-highway feature is to describe automobiles capable of off- highway operation. The axle configuration that is most impacted by the axle clearance characteristic is the solid axle, where the differential must be housed and vertically centered along a linear path between the center of the wheels on either side of the axle. In contrast, independent axles can vertically center the differential gears above the same linear path, effectively making running clearance the only constraining vertical measurement. Solid axles excel in off-highway operation at the expense of on-highway ride quality. In the NPRM, NHTSA found that creating an additional clearance characteristic that typically applies only to this solid axle type does not align with the statutory intent that the significant feature would indicate off- highway capability.

Along with the removal of the axle clearance, NHTSA is requiring that non-passenger automobiles using the off-highway pathway also meet all four of the remaining dimensions. In reaching this conclusion, NHTSA analyzed the MY 2024 fleet classification data and determined the manufacturing volumes of vehicles that qualified as non-passenger automobiles based on the vehicle's having a high ground clearance, as determined by meeting at least four of the five factors, as well as the angle and clearance values of each of those vehicles. Of particular importance was determining the subset of vehicles that met both the GVWR or 4WD off-highway criteria described in 49 CFR 523.5(b)(1) and exactly four of the five existing off-highway criteria described in 49 CFR 523.5(b)(2). NHTSA made the following observations within this subset of current off-highway classified automobiles: \1245\

\1245\ All percentages described were evaluated using “Non- Passenger_FRM_Analysis.xlsx” in Docket No. NHTSA-2025-0491, tab “Existing Reg Classification.”

Most of these classified automobiles (98.9 percent) do not meet the approach angle minimum threshold of 28 degrees;

the remaining vehicles (1.1 percent) are comprised from a single nameplate.\1246\

\1246\ The Kia Seltos has a running clearance of 7.3 inches (~18.5 cm), below the 20 cm threshold. It has an approach angle of 28.0 degrees, meeting the minimum threshold.

Many of the classified automobiles (66.2 percent) have an approach angle of less than the required departure angle of 20 degrees.\1247\

\1247\ An approach angle less than the minimum required departure angle for off-highway capability would mean that the automobiles represented in this bullet are geometrically more capable off-highway when driven in reverse.

After reviewing this data, NHTSA investigated why so few vehicles in this vehicle category meet the approach angle requirement and whether this vehicle feature is necessary for off-highway operation. The vehicle attributes outlined in 49 CFR 523.5(b)(2) include approach angle, breakover angle, departure angle, and running clearance, which work together to define what represents a vehicle designed with an off- highway capability intent without having to define the off-highway environment explicitly. The approach angle attribute is of particular importance because it is the first vehicle feature to engage with an off-highway obstacle or grade--determining whether the vehicle can navigate the obstacle. If the vehicle does not have the ability to approach the obstacle, then the other off-highway attributes become irrelevant. Because of the varying nature of off-highway environments and the equally varying ways to navigate them, the approach angle is set higher to maximize the capability of the other vehicle attributes. This higher approach angle feature can also be seen on vehicles in the 2024 fleet that are specifically designed with high levels of off- highway capability such as the Jeep Wrangler, Ford Bronco, and Land Rover Defender.\1248\ NHTSA determined in its analysis that manufacturers are reducing significantly the approach angle to as low as 14 degrees in pursuit of on-road aerodynamic improvements, ultimately degrading off-highway capability. The approach angle is an important off-highway vehicle attribute, which is why it was originally and continues to be set at 28 degrees. This approach angle observation suggests that regulatory definitions have caused shifts in vehicle design characteristics, where manufacturers apply the remaining high ground clearance characteristics (breakover angle, departure angle, and running clearance) to vehicles otherwise not intended for off-highway operation. The passenger automobile fleet's fuel economy stringencies originated and evolved at a time when high-frontal area automobiles that consumers have shown a preference for were not present in the light-duty fleet. The gradual introduction of and accompanying consumer preference for high frontal area passenger-carrying automobiles made it difficult for manufacturers to meet the passenger car CAFE standards,\1249\ which had originated and evolved prior to the widespread proliferation of this type of light-duty vehicle. Manufacturers, therefore, applied 4 out of the 5 high ground clearance characteristics, retaining aerodynamic (i.e., low) approach angles that limit off-highway capability but place these vehicles in the non- passenger automobile fleet. NHTSA proposed to correct this divergence between fleet composition and off-highway operation by re-establishing the standard curves using an updated fleet allocation, asserting that this change (along with the rest of the applicable fuel economy standards) would eliminate the need for manufacturers to decide between unnecessary high ground clearance characteristics and achieving passenger automobile fuel economy standards.

\1248\ See Non-Passenger_FRM_Analysis.xlsx, Docket No. NHTSA- 2025-0491, tab “Existing Reg Classification.”

\1249\ In this same rulemaking, NHTSA is revising standards to ensure that manufacturers can meet the CAFE standards while also producing vehicles that consumers want to purchase.

Most commenters who expressed either support for or opposition to the proposed changes to the off-highway non-passenger criteria did not provide substantive comment specific to the removal of the axle clearance criterion. Honda, however, commented that removing axle clearance is “particularly problematic” because the axle is a rigid structure, versus “sacrificial plastic bumper trim” components that would impede approach or departure angle on certain vehicles.\1250\ Although it is true that the solid axle differential is a rigid component that cannot deflect laterally, axle height is influenced almost entirely by tire diameter and does not necessarily have a direct relationship to approach, breakover, or departure angles; however, running clearance impacts directly these angles for a given design and does not include unsprung mass such as suspension components or solid axles.\1251\ Despite extensive research, NHTSA was unable to identify a single vehicle meeting the off-highway criteria in the 1975 baseline fleet for which approach angle was the omitted off-highway characteristic,\1252\ while axle clearance was a common omission. A stock Ford Bronco \1253\ or Chevrolet Blazer \1254\ in 1975, for example, could have been manufactured with approach angle, departure angle, breakover angle, and running clearance well exceeding the off- highway characteristic thresholds, but with an axle clearance below the 18-centimeter threshold. As previously stated, a solid axle provides a tractive advantage on uneven terrain compared to an independent axle. For these reasons, NHTSA continues to agree with the historic assessment that, in conjunction with the statutorily required 4WD or GVWR of at least 6,000 pounds, a vehicle meeting the originally prescribed approach angle, departure angle, breakover angle, and running clearance with an axle clearance of less than 18 centimeters would be sufficiently indicative of off-highway capability.

\1250\ Honda, Docket No. NHTSA-2025-0491-6013-A1, at 7.

\1251\ 49 CFR 523.2.

\1252\ NHTSA evaluated original manufacturer cataloged archives for vehicles that would have been classified as non-passenger via the off-highway pathway in 1975 using publicly available resources found at https://autocatalogarchive.com/index-brand/ (accessed: June 18, 2026) and https://www.jeepdatabase.com/ (accessed: June 18, 2026).

\1253\ See Ford Motor Company, Ford Bronco (Sales brochure), Ford Motor Company: Dearborn, MI (1972), available at: https://autocatalogarchive.com/wp-content/uploads/2016/08/Ford-Bronco-1972-US.pdf (accessed: June 18, 2026).

\1254\ See Chevrolet Motor Division, Chevrolet Blazer (Sales brochure), General Motors Corporation: Detroit, MI (1975), available at: https://autocatalogarchive.com/wp-content/uploads/2024/08/Chevrolet-Blazer-1975-USA.pdf (accessed: June 18, 2026).

Supporters of the proposal to require all four of the remaining off-highway criteria commented that doing so is consistent with statutory intent and a vehicle's fundamental design, and reflects actual vehicle use scenarios.\1255\ Other supporters described the five off-highway characteristics as a “regulatory checklist” that manufacturers have used to determine a vehicle's classification.\1256\ Opponents of the proposal to require all four of the remaining off- highway criteria had various categories of concern. The first is that NHTSA failed to consider off-highway environments that do not always require a significant approach angle, such as maintained trails, gravel roads, or a sandy environment like dunes or beaches. This comment came primarily from industry manufacturers and representative trade groups.\1257\ In

making this case for the variety of off-highway use cases, North American Subaru, Inc. (Subaru) stated that “the most realistic determination of off-highway capability today is actual customer perception and usage, as evidenced by the various ways and conditions in which customers use their vehicle.” \1258\ Common commenter recommendations included requiring three out of the remaining four off- highway characteristics \1259\ or reducing the approach angle threshold to match departure angle.\1260\ Honda commented that the “4-of-4” off-highway requirement “penalizes fuel-efficient designs,” “mandates inefficiency,” and degrades pedestrian safety.\1261\ NHTSA also received comment that the agency should “conduct a new analysis of the modern off-highway functional characteristics rather than relying on an analysis that is now fifty years old.” \1262\ Some commenters were also concerned that, in combination with the changes to the standards in this rule, this change would further incentivize even more extreme design choices.\1263\

\1255\ AVE, Docket No. NHTSA-2025-0490-0033-A1, at 7; MECA, Docket No. NHTSA-2025-0491-5331-A1, at 7.

\1256\ PMI, Docket No. NHTSA-2025-0491-5001-A2, at 43.

\1257\ Subaru, Docket No. NHTSA-2025-0490-0037-A1, at 2-3, 5; Stellantis, Docket No. NHTSA-2025-0491-5968-A1, at 6; Mercedes-Benz, Docket No. NHTSA-2025-0491-5854-A1, at 3; Ford, Docket No. NHTSA- 2025-0491-5821-A1, at 3-4; The Alliance, Docket No. NHTSA-2025-0491- 5707-A1, at 6.

\1258\ Subaru, Docket No. NHTSA-2025-0490-0037-A1, at 4.

\1259\ Ford, Docket No. NHTSA-2025-0491-5821-A1, at 3-4; The Alliance, Docket No. NHTSA-2025-0491-5707-A1 at 7, -A2 at 22-23.

\1260\ Mercedes, Docket No. NHTSA-2025-0491-5854-A1, at 3; The Alliance, Docket No. NHTSA-2025-0491-5707-A1, at 6-7, -A2 at 23.

\1261\ Honda, Docket No. NHTSA-2025-0491-6013-A1, at 7.

\1262\ The Alliance, Docket No. NHTSA-2025-0491-5707-A1, at 7.

\1263\ ICCT, Docket No. NHTSA-2025-0491-5240-A2, at 13.

In response to comments from automakers and NGOs regarding the need to reconsider the existing off-highway characteristics, NHTSA examined how current off-highway vehicles are designed to meet off-highway conditions. NHTSA's analysis showed, for example, that of the 70 unique nameplates of vehicles in the MY 2024 analysis fleet that qualify under the off-highway pathway of the current regulations at 49 CFR 523.5 by meeting four out of the five criteria (as previously mentioned, nearly all of which do not meet the approach angle criterion), 50 of them meet the running clearance criterion by less than or equal to one centimeter or the departure angle criterion by less than or equal to one degree, or both.\1264\ NHTSA also acknowledges that off-highway environments are varied and diverse. The correct combination of driver skill, tire selection, and tire inflation level could enable most light-duty vehicles to operate in most mild off-highway environments, such as gravel roads or beaches. The statute, however, specifies a significant feature designed for off-highway operation.\1265\ Having only one or a few of the four criteria does not constitute a significant off-highway feature; rather, all four criteria are needed to indicate having a significant off-highway feature.

\1264\ Values obtained by filtering Non- Passenger_FRM_Analysis.xlsx, Docket No. NHTSA-2025-0491, tab “Existing Reg Classification,” and filtering UNIQUE nameplates.

\1265\ 49 U.S.C 32901(a)(18)(A).

“Customer perception and usage” is a subjective assertion, and while customer utilization is an important market indicator, NHTSA must follow objective and uniform standards for enforcement and rulemaking. Changing the classification of a vehicle does not remove its existing utility or capability, nor does it alter the consumer market for those feature sets or restrict manufacturer advertising of off-road functionality.\1266\ As previously discussed, NHTSA is realigning the fuel economy curves to reflect more accurately the actual design, capability, and utility of the current light-duty vehicle fleet. With this rule, moving a reclassified vehicle back into the non-passenger automobile fleet by increasing its approach angle would yield a much less significant (if any) improvement to compliance position and would result in a fuel economy competitive disadvantage for customers who do not desire or require a high approach angle.

\1266\ NHTSA does not believe that a significant number of consumers shopping for offroad vehicles evaluate CAFE classification as part of their decision-making process.

NHTSA acknowledges that the original fifty-year-old analysis is no longer a suitable representation of the modern fleet; however, the geometric principles determining how a vehicle's high ground clearance facilitates its ability to navigate off-highway environments have not changed. When the characteristics comprising the high ground clearance feature were originally prescribed, the agency found that, by applying the original thresholds to the 1975 fleet and requiring at least four of them, they could capture all of the “off-highway capable” vehicles without including any unintended vehicles. The original off-highway criteria set may have created separation between passenger and non- passenger automobiles at the time of issue, but may not continue to do so in a more modern fleet. Despite extensive research,\1267\ the agency has been unable to find an example of a vehicle from the 1975 fleet that met four out of five off-highway characteristics while omitting approach angle, running clearance, or breakover angle. Due to the designs and technologies of the vehicles in that era, departure angle was the most common omission, with several cases of axle clearance as well. In other words, requiring approach angle, running clearance, and breakover angle as well as requiring at least one of either departure angle or axle clearance would have been a slightly more complex formula producing an identical result. Although 49 CFR 523.5(a)(3) \1268\ was and continues to account for a significant share of the non-passenger automobile fleet, 49 CFR 523.5(a)(2) \1269\ and (4) \1270\ commanded a far larger share of the non-passenger automobile fleet in the 1975 fleet versus the current fleet; in the MY 2024 non-passenger automobile analysis fleet, these two regulatory pathways accounted for 779 vehicle sales out of over nine million total.\1271\ For perspective, 19.3 percent of the total MY 1975 light-duty fleet was classified as non- passenger--a fraction of which qualified exclusively on the off-highway capability pathway; in contrast, 32.2 percent of the total MY 2024 light-duty fleet qualifies as a non-passenger automobile exclusively via the off-highway capability pathway.

\1267\ NHTSA evaluated original manufacturer cataloged archives for vehicles that would have been classified as non-passenger via the off-highway pathway in 1975 using publicly available resources found at https://autocatalogarchive.com/index-brand/ (accessed: June 18, 2026) and https://www.jeepdatabase.com/ (accessed: June 18, 2026).

\1268\ Transport property on an open bed (i.e., pickup trucks).

\1269\ Provide temporary living quarters.

\1270\ Greater cargo-carrying than passenger-carrying volume.

\1271\ See Non-Passenger_FRM_Analysis.xlsx, Docket No. NHTSA- 2025-0491, tab “Existing Reg Classification,” filtered on compliance pathways (a)(2) and (a)(4) with BEVs removed.

For these reasons, NHTSA is amending 49 CFR 523.5(b) as proposed in the NPRM, removing axle clearance specifications as an option in conjunction with three of the four other characteristics to qualify as a non-passenger automobile and instead requiring vehicles that qualify via this pathway to meet the historically prescribed values for the four remaining characteristics of approach angle, breakover angle, departure angle, and running clearance, beginning in MY 2030.

As part of its evaluation of the criteria for off-highway capability, NHTSA also investigated the statute's “4-wheel drive” off-highway feature, specifically with regard to the differences between 4WD (4x4) and AWD drivetrains. Currently, 4WD and AWD technologies

both qualify as 4WD as required by statute for vehicles that do not have a GVWR of more than 6,000 lbs.\1272\ The agency found that there is significant overlap in present-day 4WD and AWD peripheral technologies, such as axle differential locks, interaxle locks, low- range gearing and torque availability, and intelligent traction control systems that make it difficult, if not impossible, to assess off- highway ability based on the exclusively differentiating features of 4WD and AWD systems. NHTSA sought comment on this assessment in the NPRM. Commenters agreed with the agency's assessment, and NHTSA is therefore not changing its position that any drivetrain capable of sending power to all four wheels, including both 4WD and AWD systems, is sufficient to be considered a 4-wheel drive automobile under the statute's vehicle definitions at 49 U.S.C. 32901.\1273\

\1272\ 75 FR 25659 (May 7, 2010), Footnote 750.

\1273\ Subaru, Docket No. NHTSA-2025-0490-0037-A1, at 2; Stellantis, Docket No. NHTSA-2025-0491-5968-A1, at 7.