California v. National Highway Traffic Safety Administration

On October 2, 2026, California, 20 other states, the District of Columbia, Chicago, Los Angeles, the City and County of Denver, New York City, and the City and County of San Francisco filed a petition for review in the First Circuit Court of Appeals challenging the National Highway Traffic Safety Administration’s (NHTSA’s) final rule entitled “Safer Affordable Fuel-Efficient Vehicles Rule III for Model Years 2022 to 2031 Passenger Cars and Light Trucks,” which NHTSA described as a “significant reset” that involved “substantially recalibrating the Corporate Average Fuel Economy (CAFE) program to bring the program into compliance with the law and to remove previous regulatory distortions which have induced manufacturers to make design decisions that have neither aligned with market demand and the needs of American families nor have delivered the consistent improvements in the fuel economy performance of manufacturer fleets, as Congress intended.” Among other changes, the amended standards did not consider the imputed fuel economy performance of electric vehicles or the electric operation of plug-in hybrid vehicles.