VIII.  SMALL BUSINESS IMPACTS

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    A.  Regulatory Flexibility Act

    The Regulatory Flexibility Act of 1980 (5 U.S.C. §601 et seq.) requires agencies to evaluate the potential effects of their proposed and final rules on small businesses, small organizations and small governmental jurisdictions.

    Currently, there are about 4 small motor vehicle manufacturers in the United States [43]. As with other systems in the vehicle, these manufacturers will have to rely on suppliers to provide the hardware, and then they would have to integrate the system into their vehicles. The agency does not believe this will create a significant economic burden for these manufacturers. The agency is providing an alternative for the small vehicle manufacturers to meet the proposal in the last year of the phase-in period, giving them as much lead time as possible.

    There are a few recreational vehicles made which are under 10,000 pounds GVWR, which would have to comply with the standard. Most of these vehicles use van chassis supplied by the larger manufacturers (GM, Ford, or Daimler Chrysler) and could use the systems supplied with the chassis. To demonstrate compliance with FMVSS 138, a final stage manufacturer would primarily rely upon the chassis manufacturer's incomplete vehicle document.

    Aftermarket Wheel and Rim Manufacturers

    There were several commenters to the docket stating that there would be a significant impact on a large number of aftermarket wheel and rim manufacturers. The Specialty Equipment Market Association (Docket No. 8572-114) stated that there are 550 small businesses making aftermarket tires and custom wheels and this is a $2.1 billion industry. SEMA is concerned that many of the provisions will have the effect of restricting the ability of aftermarket suppliers to provide a full range of wheel and tire combinations to consumers. They were concerned that the language requiring aftermarket wheels to be compatible with only those combinations recommended by a vehicle manufacturer could disallow aftermarket equipment that does not match manufacturer's recommendations.

    The Tire Association of North America (Docket No. 8572-129) stated that a regulation that narrows consumer choice would have a significant negative impact on small business across the United States. They argued that we should delete “recommended for use on the vehicle by the vehicle manufacturer.”

    Several other different types of manufacturers made related comments. Schrader Electronics (Docket No. 8572-120) stated that replacement rims do not necessarily follow the Tire and Rim Standards. Proper fitment could not be guaranteed. Thus, replacement rims should not be required to meet the standard. The Alliance (Docket No. 8572-137) stated that the agency should exempt temporary spare tires and that manufacturers can't certify replacement tires. Ford (Docket No. 8572-141) stated that the agency should limit the scope of the final rule to those tires and rims specified for use on the vehicle by the vehicle manufacturer. Nissan (Docket No. 8572-124) stated that it was premature to include replacement tire/rims in the standard.

    The agency has decided to exempt temporary spare tires and aftermarket rims, that don't match the original equipment rims, from the requirements on a practicability basis. This should eliminate the concerns of small businesses that make and sell custom wheels and aftermarket rims.

    Low Tire Pressure Monitoring System Suppliers

    There are several suppliers of direct measurement system radio frequency transmission technology (Beru, IQ Mobil, Johnson Controls, Schrader-Bridgeport, Pacific Industrial Company, TRW, SmarTire, Rayovac, and Fleet Specialties Company). Suppliers of indirect ABS integrated technology include Continental Teves, TRW, Bosch, Eaton, and Toyota. There is one company that supplies a system that monitors the tires and puts air into the tire, Cycloid Company.

    The Regulatory Flexibility Act requires the agency to make a determination on whether the proposal could have a significant economic impact on a substantial number of small businesses. A small business is defined by the Small Business Administration, for purposes of receiving Small Business Administration assistance. The criteria for determining size, as stated in 13 CFR 121.201, is the number of employees in the firm. The suppliers would fall under either Subsection 336340 Motor Vehicle Brake System Manufacturers or Subsection 336322 Other Motor Vehicle Electrical and Electronic Equipment Manufacturers. A company under these subsections must have less than 750 employees to be considered a small business. Only three of these companies could have less than 750 employees (SmarTire, Fleet Specialties Company, and Cycloid Company). The agency does not have employee data on SmarTire and Fleet Specialties Company. Cycloid Company has less than 10 employees and outsources the manufacturing of their products. However, to be considered in the substantial number of small businesses, the business headquarters should be in the United States. SmarTire is located in the United Kingdom and Canada.

    In conclusion, the agency believes that this proposal will not affect a substantial number of small businesses.


    B.  Unfunded Mandates Reform Act

    The Unfunded Mandates Reform Act of 1995 (Public Law 104-4) requires agencies to prepare a written assessment of the costs, benefits, and other effects of proposed or final rules that include a Federal mandate likely to result in the expenditures by State, local or tribal governments, in the aggregate, or by the private sector, of more than $100 million annually (adjusted annually for inflation with base year of 1995). Adjusting this amount by the implicit gross domestic product price deflator for the year 2000 results in $109 million (106.99/98.11 = 1.09). The assessment may be included in conjunction with other assessments, as it is here.

    This proposal is not likely to result in expenditures by State, local or tribal governments of more than $109 million annually. However, it is estimated to result in the expenditure by automobile manufacturers and/or their suppliers of more than $109 million annually. The agency has estimated that compliance with this final rule would cost from $775 million to over $1.1 billion. The final cost will depend on choices made by the automobile manufacturers.

    These effects have been discussed in the Preliminary Economic Assessment; see for example the chapters on Cost, Benefits and the previous discussion in this chapter on the Regulatory Flexibility Act.


    IX.  CUMULATIVE IMPACTS

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    Section 1(b) II of Executive Order 12866 Regulatory Planning and Review requires the agencies to take into account to the extent practicable "the costs of cumulative regulations". To adhere to this requirement, the agency has decided to examine both the costs and benefits by vehicle type of all substantial final rules with a cost or benefit impact effective from MY 1990 or later. In addition, proposed rules are also identified and preliminary cost and benefit estimates provided.

    Costs include primary cost, secondary weight costs and the lifetime discounted fuel costs for both primary and secondary weight. Costs will be presented in two ways, the cost per affected vehicle and the average cost over all vehicles. The cost per affected vehicle includes the range of costs that any vehicle might incur. For example, if two different vehicles need different countermeasures to meet the standard, a range will show the cost for both vehicles. The average cost over all vehicles takes into account voluntary compliance before the rule was promulgated or planned voluntary compliance before the rule was effective and the percent of the fleet for which the rule is applicable. Costs are provided in 2000 dollars, using the implicit GNP deflator to inflate previous estimates to 2000 dollars.

    Benefits are provided on an annual basis for the fleet once all vehicles in the fleet meet the rule. Benefit and cost per average vehicle estimates take into account voluntary compliance.


Table IX-1
COSTS OF RECENT PASSENGER CAR RULEMAKINGS
(Includes Secondary Weight and Fuel Impacts)
(2000 Dollars)
Description Effective Model Year Cost Per Affected Vehicle $ Cost Per Average
Vehicle $
FMVSS 114, Key Locking System to Prevent Child-Caused Rollaway 1993 $9.44 – 19.58 $0.53 - 1.08
FMVSS 214, Dynamic Side Impact Test 1994 - 10% phase-in
1995 - 25%
1996 - 40%
1997 – 100%
$69.06 – 672.59 $62.52
FMVSS 208, Locking Latch Plate for Child Restraints 1996 $0.89 – 17.93 $2.40
FMVSS 208, Belt Fit 1998 $3.41 – 17.09 $1.26 - 1.82
FMVSS 208, Air Bags Required 1997 - 95%
1998 – 100
$503.50 – 608.39 $503.50 – 608.39
FMVSS 201, Upper Interior Head Protection 1999 - 10%
2000 - 25%
2001 - 40%
2002 - 70%
2003 – 100%
$37.76 $37.76
FMVSS 225, Child Restraint Anchorage Systems 2001 - 20%
2002 - 50%
2003 - 100%
$3.01 - $7.08 $6.07
FMVSS 208, Advanced Air Bags Two phases
2003 to 2010
$24.15 to 134.40 Depends on method chosen to comply
FMVSS 301, Fuel Tank Integrity Upgrade 2007 - 40%
2008 - 70%
2009 - 100%
$5.08 $2.35

Table IX-2
BENEFITS OF RECENT PASSENGER CAR RULEMAKINGS
(Annual benefits when all vehicles meet the standard)
Description Fatalities Prevented Injuries Reduced Cost Per Average
Vehicle $
FMVSS 114, Key Locking System to Prevent Child Caused Rollaway None 50-99 Injuries Not Estimated
FMVSS 214, Dynamic Side Impact Test 512 2,626 AIS 2-5 None
FMVSS 208, Locking Latch Plate for Child Restraints Not estimated Not estimated None
FMVSS 208, Air Bags Required
Compared to 12.5% Usage in 1983

Compared to 46.1% Usage in 1991


4,570 - 9,110

2,842 - 4,505

AIS 2-5
85,930 - 155,090

63,000 - 105,000

None
FMVSS 201, Upper Interior Head Protection 575 - 711 251 - 465 AIS 2-5 None
FMVSS 225, Child Restraint Anchorage Systems  – Benefits include changes to Child Restraints in FMVSS 213 36 to 50* 1,231 to 2,929* None
FMVSS 208, Advanced Air Bags 117 to 215** 584 to 1,043 AIS
2-5**
Up to $85 per vehicle*
FMVSS 301, Fuel Tank Integrity Upgrade 4 to 11 none none
* Total benefits for passenger cars and light trucks

** Total benefits for passenger cars and light trucks, does not count potential loss in benefits if air bags are significantly depowered.

Table IX-3
COSTS OF PROPOSED PASSENGER CAR RULES
(Includes Secondary Weight and Fuel Impacts)
(2000 Dollars)
Description Effective Model Year Cost Per Affected
Vehicle $
Cost Per Average
Vehicle $
FMVSS 202, Head Restraint Upgrade TBD – first model year starting 3 years after final rule $8.10 to $17.15 $10.70
FMVSS 208, Rear Center Seat Lap/Shoulder Belts 2006 - 50%
2007 - 80%
2008 - 100%
$15.41 $3.91
FMVSS 214, Side Impact Oblique Pole Test TBD – first model year starting 4 years after final rule, then a 3 year phase in of 20%, 50%, all vehicles $116 to $253 $87 to $199

Table IX-4
BENEFITS OF PROPOSED PASSENGER CAR  RULES
(Annual benefits when all vehicles meet the standard)
Description Fatalities Prevented Injuries Reduced Property Damage
Savings $
FMVSS 202, Head Restraint Upgrade None 12,395 None
FMVSS 208, Rear Center Seat Lap/Shoulder Belts 16 279 None
FMVSS 214, Side Impact Oblique Pole Test 343 to 516 440 to 519
AIS 3-5
None
* Total benefits for passenger cars and light trucks

** Total benefits for passenger cars and light trucks, does not count potential loss in benefits if air bags are significantly depowered.

Table IX-5
COSTS OF RECENT LIGHT TRUCK RULEMAKINGS
(Includes Secondary Weight and Fuel Impacts)
(2000 Dollars)
Description Effective Model
Year
Cost Per Affected
Vehicle $
Cost Per Average
Vehicle $
FMVSS 202, Head Restraints 1992 $46.87 – 113.70 $5.54
FMVSS 204, Steering Wheel Rearward Displacement for 4,000 to 5,500 lbs. unloaded 1992 $6.05 – 29.95 $1.07 – 2.03
FMVSS 208, Rear Seat Lap/Shoulder Belts 1992 $69.25 $0.41
FMVSS 114, Key Locking System to Prevent Child- Caused Rollaway 1993 $9.44 – 19.58 $0.01 - 0.03
FMVSS 208, Locking Latch Plate for Child Restraints 1996 $0.89 - 17.92 $2.40
FMVSS 108, Center High-Mounted Stop Lamp 1994 $15.06 – 22.76 $15.53
FMVSS 214, Quasi-Static Test (side door beams) 1994 - 90%
1995 – 100
$67.38 – 84.50 $62.45 – 78.45
FMVSS 216, Roof Crush for 6,000 lbs. GVWR or less 1995 $24.81 – 222.65 $0.89 – 8.82
FMVSS 208, Belt Fit 1998 $3.77 – 17.83 $6.44 - 8.68
FMVSS 208, Air Bags Required 1998 - 90%
1999 – 100
$503.50 – 608.39
dual air bags
$503.50 – 608.39
dual air bags
FMVSS 201, Upper Interior Head Protection 1999 - 10%
2000 - 25%
2002 - 70%
2003 - 100%
$37.40 – 81.90 $57.72
FMVSS 225, Child Restraint Anchorage Systems 2001 - 20%
2002 - 50%
2003 - 100%
$3.01 - $7.08 $6.07
FMVSS 208, Advanced Air Bags two phases
2003 to 2010
$24.15 to 134.40 Depends on method chosen to comply
FMVSS 301, Fuel Tank Integrity Upgrade 2007 - 40%
2008 - 70%
2009 - 100%
$5.08 $2.35

Table IX-6
BENEFITS OF RECENT LIGHT TRUCK RULEMAKINGS
(Annual benefits when all vehicles meet the standard)
Description Fatalities Prevented Injuries Reduced Property Damage
Savings $
FMVSS 202, Head Restraints None 470 - 835 AIS 1
20 - 35 AIS 2
None
FMVSS 204, Steering Wheel Rearward Displacement for 4,000 to 5,500 lbs. Unloaded 12 – 23 146 - 275 AIS 2-5 None
FMVSS 208, Rear Seat Lap/Shoulder Belts None 2 AIS 2-5 None
FMVSS 114, Key Locking System to Prevent Child Caused Rollaway None 1 Injury Not Estimated
FMVSS 208, Locking Latch Plate for Child Restraint Not estimated Not estimated None
FMVSS 108, Center High Mounted Stop Lamp None 19,200 to 27,400 Any AIS Level $119 to 164 Million
FMVSS 214, Quasi-Static Test (side door beams) 58 – 82 1,569 to 1,889 hospitalizations None
FMVSS 216, Roof Crush for 6,000 lbs. GVWR or less 2 – 5 25-54 AIS 2-5 None
FMVSS 208, Belt Fit 9 102 AIS 2-5 None
FMVSS 208, Air Bags Required Compared to 27.3% Usage in 1991 1,082 – 2,000 21,000 - 29,000 AIS 2-5 None
FMVSS 201, Upper Interior Head Protection 298 – 334 303 - 424 None
FMVSS 225, Child Restraint Anchorage Systems  – Benefits include changes to Child Restraints in FMVSS 213 36 to 50* 1,231 to 2,929* None
FMVSS 208, Advanced Air Bags 117 to 215** 584 to 1,043 AIS 2-5** Up to $85 per vehicle*
FMVSS 301, Fuel Tank Integrity Upgrade 4 to 11 none None
* Total benefits for passenger cars and light trucks

** Total benefits for passenger cars and light trucks, does not count potential loss in benefits if air bags are significantly depowered.

Table IX-7
COSTS OF PROPOSED LIGHT TRUCK RULES
(Includes Secondary Weight and Fuel Impacts)
(2000 Dollars)
Description Effective Model
Year
Cost Per Affected
Vehicle $
Cost Per Average
Vehicle $
FMVSS 202, Head Restraint Upgrade TBD - $8.10 to $17.15 $10.70
FMVSS 208, Rear Center Seat Lap/Shoulder Belts 2006 - 50%
2007 - 80%
2008 - 100%
$15.41 to $201.40 $23.33
FMVSS 214, Side Impact Oblique Pole Test TBD – first model year starting 4 years after final rule, then a 3 year phase in of 20%, 50%, all vehicles $116 to $253 $87 to $199

Table IX-8
BENEFITS OF PROPOSED LIGHT TRUCK RULES
(Annual benefits when all vehicles meet the standard)
Description Fatalities Prevented Injuries Reduced Property Damage
Savings $
FMVSS 202, Head Restraint Upgrade none 1,852 None
FMVSS 208, Rear Center Seat Lap/Shoulder Belts 17 253 None
FMVSS 214, Side Impact Oblique Pole Test 343 to 516 440 to 519
AIS 3-5
None


    [43]  Avanti, Callaway, Panoz, and Saleen. 


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