Corporate Average Fuel Economy (CAFE) is a set of federal regulations in the United States that dictate the minimum average fuel efficiency a manufacturer's fleet of cars and light trucks must achieve. Automakers that fail to meet the fleet-wide miles per gallon target face heavy financial penalties. This standard drives the industry toward downsizing engines and increasing hybridization.
They dropped the V8 option on the new truck line entirely just to meet CAFE standards.
Related terms
Downsizing
The industry trend of replacing large-displacement engines with smaller, forced-induction powerplants.
Hybridization
The process of adding electric propulsion to traditional internal combustion vehicle platforms.
Compliance car
A low-volume electric vehicle built solely to meet strict regional emissions regulations.