DOT finalizes CAFE/SAFE III reset: ~34.9 mpg by 2031, no credit trading from MY2028

The U.S. Department of Transportation has finalized SAFE Vehicles Rule III, NHTSA’s reset of corporate average fuel economy (CAFE) standards for passenger cars and light trucks for model years 2022–2031. The final rule was published in the Federal Register on September 30, 2026 and takes effect November 30, 2026.

The headline numbers

NHTSA projects a combined industry fleetwide average of roughly 34.9 mpg in MY2031 (the actual standards are footprint-based target curves, so the fleet mix still moves the real average). DOT also cites about $1,300 lower average new-vehicle cost versus the previous path.

Stringency rises from newly set MY2022 baselines at about 0.90%/year for passenger cars and 0.51%/year for light trucks through MY2029, then 1%/year through MY2031, with MY2030 bridging a vehicle-classification update.

Credit trading ends from MY2028

Inter-manufacturer CAFE credit trading is eliminated for credits earned from MY2028 onward. Credits earned through MY2027 can still be bought and used for up to five model years. Intra-company transfers and carry-forward/back within a manufacturer’s own fleets stay.

The rule also drops AC/off-cycle fuel-consumption improvement values from the standard-setting analysis starting MY2028 and reworks light-truck vs passenger-car classification from MY2030.

What NHTSA says it did

NHTSA says the new standards are set without counting EV “imputed” fuel economy or PHEV electric operation when determining maximum feasible levels — a statutory constraint the agency says prior rules breached. EV makers can still sell EVs; those sales still count toward compliance via DOE’s petroleum equivalency factor, but they no longer drive the stringency baseline the way they did before.