The revised standards lower the requirement for 2031 model-year vehicles to 34.9 miles per gallon, a significant decrease from the 50.4 mpg set by the Biden administration. Federal officials claim the change will benefit the domestic auto industry and reduce consumer costs, while critics argue it will increase fuel expenses for drivers and complicate climate change efforts.

California and its allies assert that the National Highway Traffic Safety Administration (NHTSA) failed to adhere to a Congressional mandate to set corporate average fuel economy (CAFE) standards at the "maximum feasible" level. The lawsuit argues that the new standards, which require fewer miles per gallon than the fleet achieved in 2021, violate this mandate.

The legal challenge also points out that the new rules exclude electric vehicles from the baseline used to calculate fuel economy, distorting the analysis and leading to weaker standards. Furthermore, the rollback eliminates a credit trading program that allowed electric vehicle manufacturers to generate revenue by selling credits to other automakers.

Environmental groups have filed separate lawsuits challenging the same rule change, citing predictions that the average driver could pay an additional $1,600 in fuel costs over a vehicle's lifetime. These groups argue the rollback benefits oil companies at the public's expense and contributes to increased gasoline consumption and pollution.