The United States relaxes fuel standards, significantly reducing technology costs for automakers: General Motors (GM.US) is expected to save 20.4 billion dollars, and the price per vehicle may drop by nearly 1,300 dollars.

According to information from the Zhihu Finance APP, the National Highway Traffic Safety Administration (NHTSA) announced that, due to the significant reduction in fuel economy standards finalized this week, General Motors (GM.US) is expected to see its technology costs drop by $20.4 billion by 2031.

Similarly, Stellantis (STLA.US) will see its technology costs decrease by $6.2 billion, Ford (F.US) by $5.1 billion, Hyundai Motor (HYMLF.US) by $5.3 billion, Toyota (TM.US) by $4.5 billion, and Honda (HMC.US) by $4.1 billion.

Overall, NHTSA expects automakers' technology costs will decrease by $60.6 billion by 2031.

The agency predicts, “If the savings are passed on to consumers, NHTSA estimates that the average cost per new vehicle for the 2031 model year will decrease by $1,289.”

General Motors stated that it supports NHTSA's target for the final rule on Corporate Average Fuel Economy (CAFE) standards, as well as the agency's intention to better align them with market realities.

Alliance for Automotive Innovation CEO John Bozzella pointed out that the standards during the Biden administration actually required a shift to electric vehicles, which was out of touch with market realities and customer demand. He added that NHTSA's final rule is an “appropriate course correction.”

Under the previous administration, from 2027 to 2031, the automotive industry was expected to face no more than $1.83 billion in penalties for failing to meet CAFE standards.