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Corporate Average Fuel Economy standards require automakers to meet a minimum average fuel efficiency threshold for the vehicles they manufacture and sell in the United States. This study uses the latest available data to estimate the costs and benefits of CAFE standards and explores whether fuel economy can be improved in a more economically efficient way. It finds that the CAFE program harms American automakers' competitiveness and that the costs of these standards likely outweigh their benefits.
The Mackinac Center for Public Policy is a nonprofit research and educational institute that advances the principles of free markets and limited government. Through our research and education programs, we challenge government overreach and advocate for a free-market approach to public policy that frees people to realize their potential and dreams.
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