But the initiative, which would apply to vehicles starting in 2008 and be fully implemented by 2011, was criticized as insufficient by environmental activists.

Transportation Secretary Norman Mineta said the plan places more emphasis on fuel economy standards for mini-vans, pickup trucks, and sport utility vehicles - all of which are considered light trucks and currently have standards that are not as strict as those for cars.

Mineta said the plan expected to save 10 billion gallons of gasoline "in the years to come."

"This plan will save gas and result in less pain at the pump for motorists, without sacrificing safety," Mineta said.

National Highway Traffic Safety Administrator Jeffrey Runge said the plan "asks automakers for the first time to focus their technology on increasing fuel efficiency across their entire fleets, rather than only in their least economical models.

When fully implemented in 2011, all new light trucks will be required to meet miles per gallon targets based on vehicle size, said Runge.

But Kevin Curtis, vice president of the National Environmental Trust said the plan "will do nothing to relieve the pain that Americans are feeling at the pump."

"The president's plan gives Detroit enough rope to hang itself," Curtis said.

"A study using modeling methods employed by government and industry found that, in this age of record high gas prices, a real increase in fuel economy standards could actually create 15,000 US auto worker jobs. On the other hand, pretending nothing's wrong will mean 3,000 fewer jobs."

The move comes with US crude oil futures near a record reached this month of 67.20 dollars per barrel. Gasoline prices nationwide currently average 2.61 dollars per gallon (3.8 liters) - up 31 cents from a month ago and about 73 cents higher than a year ago, according to the American Automobile Association.

The new plan would replace a two-tiered system for passenger cars and light trucks with six new standards based on vehicle size.

The 2011 standard would range from 21.3 miles (34.3 kilometers) per gallon to 28.4 miles (45.7 kilometers) per gallon.

A government report showed the would lessen overall fuel consumption and improve emissions of various pollutants.

But Dan Becker, director of Sierra Club's global warming program, said any improvements under the new plan would be "trivial."

"This proposal gives automakers another excuse to not make the cars that people want - ones that use availability technology to save consumers money at the gas pump and cut pollution." he said.

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