Congress Eliminates Corporate Average Fuel Economy (CAFE) Penalties for Passenger Cars and Light Trucks
In one of its many changes, the One Big Beautiful Bill Act, enacted on July 4, 2025, eliminated civil penalties for noncompliance with federal fuel economy standards. Specifically, Section 40006 of the Act amends the language of the Corporate Average Fuel Economy (CAFE) statute to reset the maximum civil penalty to $0.00. Although the statute and its implementing regulations otherwise remain in place, this amendment removes any civil penalties for producing passenger cars and light trucks that do not meet fuel economy requirements.
NHTSA Adopts Rule Requiring Automatic Emergency Braking on Light Vehicles
On May 9, 2024, the National Highway Traffic Safety Administration (NHTSA) published a final rule adopting a Federal Motor Vehicle Safety Standard (FMVSS) that requires automatic emergency braking (AEB) systems in U.S. light vehicles and trucks by September 2029. The rule is required under the Bipartisan Infrastructure Law of 2021 (BIL), in which Congress directed NHTSA to establish FMVSS requirements for AEB systems as well as three other Level 2 advanced driver assistance systems (ADAS): lane departure warnings, lane-keeping assist, and forward collision warnings (FCW).
