New Jersey has joined a California-led coalition of 21 states, the District of Columbia and local governments challenging the Trump administration’s revised vehicle fuel economy standards, arguing that the federal government has abandoned its duty to require the highest feasible efficiency levels.
Attorney General Jennifer Davenport filed the lawsuit on Friday, October 2, 2026, in the U.S. Court of Appeals for the First Circuit. The plaintiffs are seeking review of a rule issued by the National Highway Traffic Safety Administration, or NHTSA, that was published on September 30.
The rule revises fuel-economy requirements for new passenger cars and light trucks for model years 2022 through 2031. Federal transportation officials estimate it would result in a fleetwide average fuel economy of 34.9 miles per gallon by model year 2031.
That is below the fleetwide average of about 50.4 miles per gallon by 2031 projected under standards adopted by President Joe Biden’s administration in 2024. The case puts the administration’s approach to vehicle affordability against a coalition’s argument that weaker standards will leave motorists with higher fuel costs.
California is leading the coalition, which includes the attorneys general of Arizona, Colorado, Connecticut, Delaware, Hawai'i, Illinois, Maine, Maryland, Massachusetts, Michigan, Minnesota, New Mexico, New York, North Carolina, Oregon, Rhode Island, Vermont, Washington and Wisconsin, as well as the District of Columbia. New Jersey is also a plaintiff.
The local government plaintiffs are the City of Chicago, the City of New York, the City and County of Denver, and the City and County of San Francisco. The Denver and San Francisco parties include two county governments.
The coalition says NHTSA acted contrary to the law by setting standards below the “maximum feasible” level required by Congress. The Energy Policy and Conservation Act, enacted in 1975, directs NHTSA to establish “maximum feasible” fuel economy standards for new vehicles.
The plaintiffs also contend that NHTSA’s standards for the next five years require less efficiency than the U.S. vehicle fleet achieved in 2021. They argue that the agency failed to account for recent advances in electric vehicle technology, as well as the costs of oil-price shocks and climate pollution.
The coalition alleges that the final rule is arbitrary and capricious, in breach of the Administrative Procedure Act and the Energy Policy and Conservation Act. It says the rule would result in nearly $220 billion in lost fuel savings for drivers.
Davenport said: “Every mile driven impacts our children's future.” She said higher fuel-efficiency standards would cut carbon emissions and save families money at the pump.
The administration has presented the policy as a way to reduce the upfront cost of vehicles. Transportation Secretary Sean Duffy said the change would lower the average price of a new vehicle by about $1,300 and save drivers about $138 billion over five years.
The revised rule will also end the Corporate Average Fuel Economy, or CAFE, credit trading programme in 2028. Last year, Republicans in Congress eliminated fines for automakers that failed to meet mileage standards.
The First Circuit has yet to set out a timetable for reviewing the challenge. NHTSA’s legal response and the outcome of the case are unknown.
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