US sets 54.5 mpg standard for light trucks and cars

Washington, DC, US: President Barack Obama unveiled new federal fuel-economy standards for cars and light-duty trucks.

The Obama Administration reached a settlement with all parties including environmental groups that will require all cars and light-duty trucks to achieve a standard 54.5 mpg (4.32litres/100km) by model year 2025.

GM, Ford, Chrysler, Toyota, Nissan, Honda, Hyundai, BMW, Volvo, Mazda, Mitsubishi and Jaguar attended the announcement this morning in Washington, DC.

The new corporate average fuel economy (CAFE) standards will increase from 2017 at 5% annually for cars and 3.5% for light trucks through 2021, with an overall target of a fleetwide average of 54.5 miles per US gallon by 2025.  Current standards were set at 35mpg by 2016 in 2008, when the automotive industry was in a compliant mood after a US$50bn government bailout.