The transport sector accounts for one-fourth of the carbon dioxide (CO2) emissions in the European Union and almost one-third in the United States, and both sides of the Atlantic have tackled this issue with regulatory standards. In his Transatlantic Perspectives essay, DAAD/AICGS Fellow Carl-Friedrich Elmer examines the general economic rationale for mandatory vehicle emission standards as well as crucial factors that determine the environmental efficacy and economic efficiency of this regulatory approach, also looking at how such standards can be embedded in the broader context of climate policy.