President Joe Biden has announced the strictest regulation on vehicle exhaust emissions ever enacted in the US in a bid to accelerate the auto-industry’s shift to electric cars.
It includes a goal for 56% of all new vehicles sold to be electric by 2032 – a huge increase from current levels.
In a concession to car plants, the rule was softened from last year’s draft.
But the Biden administration says it will still dramatically reduce planet-warming gases.
Wednesday’s rule will prevent 7bn tonnes of carbon dioxide emissions over the next 30 years, according to the Environmental Protection Agency.
Environmental groups broadly welcomed the regulation, although some activists had hoped for a stronger measure.
The US is taking a more moderate approach than the European Union and UK, which will ban all sales of petrol-powered cars from 2035.
UK Prime Minister Rishi Sunak announced last year he was delaying the British ban by five years from its original deadline of 2030.
The American car industry pointed to slower electric vehicles (EVs) sales growth in objecting to a draft US target last year that would have ensured such vehicles account for 67% of all new cars sold in 2032.
EVs made up less than 8% of all new car sales last year.
The regulation increasingly limits year-by-year the amount of pollution permitted from vehicle exhausts. Car-makers that do not meet the new standards will face stiff fines.
Companies will be able still to make petrol-powered vehicles, so long as they are a shrinking percentage of their total product line.
The rule is expected to face legal challenges from the oil industry and Republican-led states. It could ultimately be settled by the Supreme Court.
The Alliance for Automotive Innovation, a trade group representing the car industry, welcomed the slower pace of the rollout, but said the goal was still “extraordinarily ambitious”.
The policy highlights the political tightrope Mr Biden must walk.
As he runs for re-election against his Republican challenger, Donald Trump, the president is trying to win over car workers in the potentially pivotal state of Michigan, while also taking steps to address climate change, a key issue for many Democrats.
Mr Trump has pledged if he wins in November to roll back environmental regulations enacted by Mr Biden.
A spokeswoman for the Trump campaign, Karoline Leavitt, said the rule “will force Americans to buy ultra-expensive cars they do not want and cannot afford while destroying the US auto industry in the process”.
She added that if Mr Trump wins, he will reverse the regulation on his first day in office, and “protect the freedom of Americans to drive whichever vehicle they choose”.
The average sale price of an EV was around $53,500 last year, according to trade publication Kelly Blue Book, some $5,000 more than petrol-powered cars.
The average annual salary in the US is about $59,000.
The Republican Speaker of the House of Representatives, Mike Johnson, also criticised the policy as “another radical, anti-energy crusade that will limit consumer choices, raise costs on American families and devastate auto manufacturers”.
He argued the rule would force the US to rely on China for the minerals needed to produce vehicle batteries.