Donald Trump has scrapped Biden-era electric vehicle mandates and approved looser CAFE standards, promising $100 billion for US carmakers. The move could reshape global production plans and delay the electric transition for years.
Detroit just got a new playbook. Donald Trump has tossed out the Biden administration’s electric vehicle mandate and brought in a fresh set of CAFE rules. These new standards ease up on fuel economy targets for automakers. The announcement landed on Truth Social, and it hit hard. Trump’s message was simple: forced electrification is off the table, at least for now.
He didn’t hold back. Trump blamed Democrats for wasting billions and pushing Americans into cars they never asked for. He said the new CAFE standards will “cut the waste” in US manufacturing. He promised lower car prices and savings for families. Trump also pledged $100 billion for the US auto industry. He wants factories back in Michigan, Ohio, Indiana, and South Carolina. He gave credit to his Transportation and Commerce secretaries, Sean Duffy and Howard Lutnick, for making the overhaul happen.
According to Politico and Reuters, the new CAFE target is set at approximately 34.5 miles per gallon by 2031, which is about a third less stringent than the previous Biden-era goal of 50.4 mpg.
This isn’t just a headline for automakers. Under Biden, the EPA set tough emissions targets and forced carmakers to boost electric vehicle sales. Trump had already killed off EV tax breaks with the One Big Beautiful Bill Act. Now, with the CAFE rules relaxed, the cheapest way to comply is to keep improving combustion engines, hybrids, and microhybrids. That’s exactly what General Motors, Ford, and Stellantis have been asking for. Their wish list is now policy, unless the courts step in.
CAFE—short for Corporate Average Fuel Economy—is run by the NHTSA. It sets the average fuel use for each automaker’s fleet. Softer rules mean less pressure to sell electrics. Gas engines get a longer lease on life. This isn’t about EVs failing. It’s about politics. Changing the rules is cheaper than rebuilding factories from scratch.
Spanish drivers aren’t immune. Stellantis plants in Figueruelas and Vigo, and Ford’s Almussafes site, all build cars for global markets. Their product plans are shaped in Washington as much as in Madrid. If the US slows its electric shift by five or ten years, models once planned as pure EVs could show up in Spain as hybrids. Entry-level prices in some segments might stay flat longer than expected. But Trump’s promised savings won’t reach Spain. American rules won’t make Spanish cars cheaper.
According to Electrek, the National Highway Traffic Safety Administration (NHTSA) estimates that the softer CAFE standards could increase US fuel costs by $185 billion and raise emissions by about 5% compared to the previous targets.
The fight with California isn’t over. Trump has already signed three congressional resolutions to block the state’s diesel and electric vehicle mandates. He claims his signature will “kill California’s mandates forever.” He says the state doesn’t have the power grid to back up its plans. California’s rules often set the pace for other states. If this lands in court, automakers will have to juggle two sets of rules for months.
Three big questions remain. First, the final text and timing of the CAFE rules. Second, lawsuits from states with stricter standards. Third, how manufacturers who have already spent billions on electrification will react. They won’t walk away quietly.
For those watching the Spanish car market, the short-term effect is small. The real change comes later. Models arriving in 2027 and 2028 could look different—more hybrids, fewer pure electrics. As reported earlier, the race for cheap EVs in Spain is already fierce. The US shift could slow the global rollout of new electric models.
Trump’s $100 billion pledge grabs headlines. But the real story is regulatory. General Motors, Ford, and Stellantis now have the breathing room they wanted. Manufacturers who bet big on electrics lose a key argument. The CAFE standard, born in 1975 after the oil crisis, has changed almost as often as the White House. This rewrite isn’t just technical. It’s a political move that will steer the industry for years. For now, the US is backing combustion engines. The ripple will reach far beyond its borders.
