The regulations were plain dumb -- a classic attempt by a bureaucratic working group signed off by the higher ups who have no idea how economic incentives work.

The goal was to capture externalities -- so target the SOURCE of the externality (with a fuel tax). Raise the tax on emissions-producing fuel and provide rebates for validating certain standards regarding how efficient the fuel is burned. This way the tax applies equally to all polluters and doesn't create any unintended consequences in the market due to misaligned incentives.

A higher fuel tax incentivizes not only fuel efficient vehicles but electric vehicles and renewable energy -- whichever is the most economically efficient. Instead, we have a misaligned incentive that will further prolong our dependence on hydrocarbon-burning cars. But of course, raising gas prices wouldn't be very politically expedient...

Note: I am not defending the administration's decision as it was made for the wrong reasons and there is no replacement.