Since the mid-’70s, the National Highway Transportation Safety Administration (NHTSA) in the U.S. has worked with the Environmental Protection Agency (EPA) to establish Corporate Average Fuel Economy (CAFE) standards. These organizations establish a miles-per-gallon threshold for each model year, and the average fuel economy of all an automaker’s cars sold in the U.S. must meet that standard. Passenger cars and light trucks are classified separately for CAFE purposes, and SUVs have traditionally been grouped with trucks. In early December, the Trump administration announced it would be rolling back Biden-era CAFE increases, and Secretary of Transportation Sean Duffy added that the rollback could bring a resurgence of the station wagon. 
The NHTSA also proposed changing how vehicles are classified, reserving the light truck category for off-road vehicles and those designed to carry cargo; SUVs would be grouped with sedans and smaller cars as ‘passenger vehicles.’ The Biden administration set a CAFE standard of 50.4 mpg for 2031, but the proposed adjustments would reduce that to 34.5 mpg. As for the forgotten station wagon, the body style was popular with families in the 1970s and ’80s but lost market share to minivans and SUVs as the century wound to a close. 
With heavy SUV sales counting toward each automaker’s more lenient light truck mpg standard, the incentive was to build as many of these vehicles as customers were willing to buy. Station wagons typically fall between sedans and SUVs in terms of fuel mileage, and automakers might replace some SUV models with wagons to boost their passenger car mpg averages.  A half-century of steadily increasing CAFE standards has already forced automakers to produce more efficient vehicles, including some impressive modern SUVs. These 2025 SUV models all get 30 mpg or more, although the most efficient cars on the road today are smaller hybrids like the Toyota Prius, Corolla, and Camry.
There are dozens of current models (including several SUVs) that already eclipse the government’s new target for 2031. The proposed adjusted figure of 34.5 mpg is well within the capabilities of many internal combustion engine (ICE) vehicles, and most automakers’ averages get a boost from the presence of hybrid cars. The most fuel-efficient SUV on the market in 2025 is the Kia Niro FE, which offers an EPA-estimated combined rating of 53 mpg. Demand for hybrid vehicles has remained strong in the second half of 2025, and Reuters reports that Americans bought a record 16.4 million hybrids in the year’s first 10 months. It seems that buyers continue to favor cars that cost less at the fuel pump regardless of CAFE standards.
In Europe and China where demand for station wagons is higher than in the U.S., many manufacturers already offer efficient models. For example, Mercedes-Benz currently sells gas and diesel-fueled CLA station wagons in the EU that deliver almost 40 mpg. European buyers can also get C-Class and E-Class station wagons, while the only Mercedes wagon available in the U.S is the E-class. Stateside, the CLA and C-Class are sold solely as sedans, and the E-class wagon starts at over $78,000. The division between SUVs and station wagons has already been blurred by the ubiquity of models like the Subaru Outback and Toyota Crown Signia, so expect to see more cars of a similar style in the next few years.

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