Key Takeaways
Transportation Secretary Sean Duffy has revoked a waiver granted post-election by the Biden administration that allowed New York Governor Kathy Hochul to impose a “congestion fee” toll on roads built and maintained with federal funds in Manhattan.
The toll, which Hochul held off implementing until after the November elections, hurts lower-income drivers more and was the first of its kind in the United States.
The money from the toll will be used to help pay for mass transit in New York City.
Duffy has also asked NHTSA to revisit its mileage standards for new vehicles, which under Biden became a vessel for policies pushing the adoption of electric cars, upon which U.S. legacy manufacturers have been experiencing enormous losses to comply with federal edicts.
President Trump believes that families, individuals, and businesses should buy vehicles that fit their needs rather than follow government demands to force electric vehicles on Americans.
Trump is also directing reviews of EV subsidies, mandates, and other policies put into place by the Biden administration, eliminating choice for purchasers of vehicles.
EPA Administrator Lee Zeldin is sending the California waiver of the Clean Air Act that allows California to set its own unique standards — thereby empowering their efforts to ban the sale of new internal combustion engine vehicles — to Congress, making it subject to the Congressional Review Act.
The Trump administration told New York to end its congestion pricing program, which charges drivers entering parts of Manhattan for using the roads. President Trump ordered his transportation secretary, Sean Duffy, to revoke federal approval for NYC’s congestion pricing plan granted by the Biden Administration after the November election. “CONGESTION PRICING IS DEAD,” Trump wrote on Truth Social. Transportation Secretary Duffy called the toll a slap in the face to working-class Americans and small business owners. Since early January, cars have paid $9 to enter Manhattan below 60th Street, the most visited part of the city. The toll aims to ease traffic, reduce emissions, and raise money for the city subway system. Trump and others have criticized the program as bad for commuters, many of whom drive into Manhattan for work, and bad for business. NY Governor Hochul said she would challenge Trump’s order.
Duffy wrote in a letter to Hochul, “Commuters using the highway system to enter New York City have already financed the construction and improvement of these highways by paying gas taxes and other taxes. But now, the toll program leaves drivers without any free highway alternative, and instead, it takes more money from working people to pay for a transit system and not highways. It’s backward and unfair. The program also hurts small businesses in New York that rely on customers from New Jersey and Connecticut. Finally, it impedes the flow of commerce into New York by increasing costs for trucks, which in turn could make goods more expensive for consumers. Every American should be able to access New York City regardless of their economic means. It shouldn’t be reserved for an elite few.” Hochul’s program had been years in the making. However, she held off its implementation until after the November elections in order to flip some congressional seats in the suburbs she feared would be in jeopardy if the announcement were made before the election.
Hochul claims the program has been a success: “Since this first-in-the-nation program took effect last month, congestion has dropped dramatically, and commuters are getting to work faster than ever. Broadway shows are selling out, and foot traffic to local businesses is spiking. School buses are getting kids to class on time, and yellow cab trips increased by 10%. Transit ridership is up, drivers are having a better experience, and support for this program is growing every day.” According to the New York Times, gridlock has eased in the city, where the average number of cars entering Manhattan daily dropped by 7.5% in the first week. A poll from Morning Consult found that 66 percent of those who paid the toll liked the program, with 59 percent of voters across New York saying they want it to continue. According to NY state officials, New York will not turn off the tolls until a court order is given, and it will continue to use the license plate reader cameras.
Staten Island’s Borough President, Nassau County’s Executive, New Jersey’s Governor, and other area politicians defended Trump’s order to rescind approval of the congestion pricing toll, saying it is an oppressive tax, a burden on taxpayers, a burden on students and the people who work in that area. Congestion pricing has overcrowded trains and buses and made commutes miserable, according to them.
Duffy Orders Review of Corporate Average Fuel Economy Standard
Transportation Secretary Sean Duffy’s first official act was to direct the National Highway Safety Administration (NHTSA) administrator to immediately review and reconsider all existing fuel economy standards for vehicles produced from the 2022 model year onward. In particular, he was looking to reset Corporate Average Fuel Economy (CAFE) standards for model year 2027-2032 passenger cars and light-duty trucks, which NHTSA issued last summer. That standard was part of the Biden administration’s de facto electric vehicle mandate, requiring automakers to reach an average of 50.4 miles per gallon across their new-car fleets by the 2031 model year, which Duffy saw as government overreach that had driven up the cost of new cars. Duffy told NHTSA to propose rescinding or replacing the standards to align with President Trump’s executive orders that allow Americans to choose the vehicle and fuel type that best fits their family and business needs rather than forcing electric vehicle (EV) adoption.
In concert with Duffy’s move, Trump’s Environmental Protection Agency (EPA) needs to review or rewrite limits on vehicle tailpipe emissions by Biden’s EPA, which force carmakers to sell more electric models or face large fines. Although the Biden administration eased near-term requirements after pushback from automakers and the United Auto Workers union, the Biden EPA held to its 2032 requirement that increased EV sales in concert with the CAFE standard to two-thirds of sales by 2032.
Other Trump Directives
President Trump has also ordered his administration to consider eliminating subsidies and other policies for increasing sales of electric vehicles. The Democrat-passed Inflation Reduction Act of 2022, Biden’s climate law, provided loans and incentives to automakers to manufacture electric vehicles and EV batteries in the United States. Automakers also invested heavily in the EV industry, losing money as the demand for plug-in models slowed due to their disadvantages in range, charging infrastructure availability, and cost, as they are still more expensive than those powered by gasoline and diesel engines.
Due to Trump’s executive orders, BloombergNEF lowered its forecast for fully electric and plug-in hybrid model sales to be one-third of total U.S. sales by 2030, down from the 48% share expected under Biden’s regulations. The forecast does not include rescinding waivers granting California permission to set more stringent auto-pollution limits. California is pushing for all-electric or zero-emission vehicles by 2035. Trump EPA Administrator Lee Zeldin, has submitted the California waiver to Congress for repeal under the Congressional Review Act.
Wood Mackenzie also revised its forecast, stating that electric vehicles will make up 23% of sales by 2030, rather than the Biden administration’s estimate of 32%. The Wood Mackenzie projection is based on Trump administration changes to EV subsidies, including removing or restricting federal tax credits, revoking a waiver for California’s EV mandate, canceling the postal service’s EV program, and withdrawing funding for the EV charging program.
Conclusion
Sean Duffy, Trump’s transportation secretary, is moving ahead with Trump’s energy dominance program by ordering NHTSA to review and revise its CAFE standard and has written to NY Governor Hochul, removing federal approval of congestion pricing in New York City. The actions are to put Americans back in the driver’s seat regarding what is best for their businesses and families rather than being forced to accept what the Biden administration and NY officials think is best for their transportation needs. The CAFE revisions are expected to lower forced EV sales in future years since they no longer require automakers to sell large electric vehicles or face fines. Removing federal approval of NYC’s congestion pricing will allow commuters to New York City to take the best method of transportation to meet their needs rather than having to pay an extra toll.
