ID: nht90-4.49

TYPE: Interpretation-NHTSA

DATE: October 22, 1990

FROM: Paul Jackson Rice -- Chief Counsel, NHTSA

TO: William F. Canever -- Staff Attorney, Office of General Counsel, Ford Motor Company

TITLE: None

ATTACHMT: Attached to letter dated 6-1-90 from W.F. Canever to S.P. Wood; Also attached to letter dated 8-1-90 from K. DeMeter to W.F. Canever

TEXT:

This responds to your letter concerning the implications under the Corporate Average Fuel Economy ("CAFE") program of the acquisition by Ford Motor Company ("Ford") of Jaguar plc ("Jaguar"). You stated that you believe all Ford and Jaguar vehicles produ ced and imported for model year ("MY") 1989 should be placed in Ford's fleet.

As discussed below, we have concluded that Ford's acquisition of Jaguar did not take place until MY 1990. Thus, Ford and Jaguar vehicles constituted separate fleets for MY 1989. As a consequence, while the fuel economy credits earned by the combined Fo rd/Jaguar fleet in MY 1990 may be applied to reduce (or eliminate) Jaguar's CAFE shortfall in MY 1987 and later years, the credits earned by Ford in MY 1989 may not be applied to offset any Jaguar shortfall.

According to your letter, Ford publicly announced its tender offer for Jaguar shares on November 2, 1989. This occurred after Ford had obtained the agreement of the Board of Directors of Jaguar to recommend the offer. The offer document, which constitu ted the formal legal offer, was mailed on November 8. After over 50 percent of Jaguar stock had been tendered, Ford declared the tender offer "unconditional" on December 10, 1989.

You stated that during the period of negotiation, tender offer, and acceptance, and continuing through the end of calender year 1989, Ford was "manufacturing" MY 1989 vehicles. Apparently, that statement is based on your statement that a small number of MY 1989 Jaguar and Aston Martin vehicles were imported into United States "through calendar year end 1989." You argued that because Ford controlled Jaguar and the importer of Jaguar vehicles prior to the time that the last of these MY 1989 vehicles wer e imported, and because fuel economy standards apply to particular model years as a whole and not to separate parts of a model year, all Ford and Jaguar vehicles produced and imported for MY 1989 should be placed in Ford's fleet. You contended that this treatment would be consistent with that accorded Chrysler Corporation ("Chrysler") and American Motors Corporation ("AMC") for model year 1987.

We disagree with your analysis comparing your situation to that of Chrysler/AMC, given significant differences in the timing of the respective acquisitions. In a letter to Chrysler dated April 4, 1990, NHTSA stated the following:

Another issue raised by Chrysler's memorandum is whether Chrysler and AMC became the same manufacturer for fuel economy purposes for model year

1987. According to the memorandum, Chrysler agreed to acquire AMC in the spring of 1987, and the transaction closed on August 6, 1987. . . . Since Chrysler controlled AMC prior to the end of the 1987 model year, and since fuel economy standards apply t o particular model years as a whole and not to separate parts of a model year, it is our opinion that all of the vehicles produced by both Chrysler and AMC for model year 1987 shall be treated as if manufactured by the same manufacturer, i.e., placed int o one fleet. Otherwise, one or both of the manufacturers would have two separate CAFE values, pre-acquisition (or pre-control) and post-acquisition (or post-control), for the same model year.

We continue to adhere to our view that where one manufacturer acquires another during a model year, they should be deemed as the same manufacturer, with a single CAFE value, for that model year. However, in the Chrysler/AMC acquisition, all relevant asp ects of the transaction took place during the 1987 model year.

As you know, the Motor Vehicle Information and Cost Savings Act ("Act") establishes time limits within which NHTSA must establish and/or amend fuel economy standards for a given model year that are based upon the beginning of the model year. See section s 502(b) and 502(f)(2) of the Act. In interpreting those provisions, both NHTSA and the courts have concluded that the model year is traditionally thought to start approximately October 1. See In re Center for Auto Safety, 793 F.2d 1346, 1349 (D.C. Cir . 1986); 49 Fed. Reg. 22516 (May 30, 1984); 49 Fed. Reg. 41250 (October 22, 1984). See also General Motors Corporation v. NHTSA, 898 F.2d 165, 176 (D.C. Cir. 1990); Center for Auto Safety v. NHTSA, 710 F.2d 842, 847 (D.C. Cir. 1983).

In the Chrysler/AMC case, all relevant aspects of the transaction were completed well before the completion of MY 1987, i.e., September 30, 1987. Conversely, in the Ford/Jaguar transaction, Ford made its tender offer in early November 1989 and declared t he tender offer "unconditional" on December 10, 1989. These dates and any other possible date for the acquisition are clearly within the 1990 model year, which began on approximately October 1. 1989.

We recognize that manufacturers may produce or import vehicles that are designated as belonging to a particular model year after October 1 of that year. However, for purposes of deciding the model year in which one manufacturer acquires another, we have concluded that the traditional model year is the appropriate frame of reference.

This conclusion is supported by the fact that by early November 1989, the earliest date referred to in your letter, when Ford made its tender offer, it had been selling its MY 1990 models for over a month. The fact that Ford or Jaguar may have produced or imported a small number of MY 1989 cars after the date of the acquisition is not determinative, since it has always been the case that model years can overlap for a given manufacturer, and some prior model year cars may be produced after the commencem ent of a given model year. Thus, any MY 1989 Jaguar vehicles that were imported during the last three months of 1989 should be included in Jaguar's MY 1989 fleet, as they would have been had the acquisition not occurred.

I note that your letter indicated that Ford intended to file its Final 1989 Model Year Report under the CAFE program with all MY 1989 Jaguar vehicles included in Ford's fleet. You stated, however, that you would not file that Report until you received t his agency's views on the propriety of that action. For the reasons set out above, we believe that Ford and Jaguar had separate, distinct fleets in MY 1989, and that therefore separate information should be filed for that model year.

I hope that this letter adequately explains our position on these issues. If you have any questions, please do not hesitate to contact me.

ID: nht90-4.5

TYPE: Interpretation-NHTSA

DATE: September 14, 1990

FROM: Paul Jackson Rice -- Chief Counsel, NHTSA

TO: A. Roger Hirstein -- Industry Development Center, 3M Commercial Graphics Div.

TITLE: None

ATTACHMT: Attached to letter dated 6-1-90 from A.R. Hirstein to T. Vincent (OCC 4864)

TEXT:

This is in reply to your letter of June 1, 1990, to Taylor Vinson of this Office. One of your customers has asked whether 3M's Diamond Grade Reflective Sheeting can be used in a red and white block pattern on the side of a trailer for conspicuity withou t violating Standard No. 108. Your interpretation is that the Sheeting can be used in addition to devices meeting the requirements of Standard No. 108 but not in place of them.

You are essentially correct. However, because we do not know both the pattern and location of the design, whether "side" includes the front and rear of a trailer, the reflective qualities of your sheeting, who will apply the sheeting, and whether the ap plication will occur before or after delivery of the trailer to its purchaser, we can only provide general guidelines.

Under S5.1.3 of Standard No. 108, supplementary reflective devices, i.e., devices other than those required by the standard, may be installed and present on vehicles at the time of their first sale as long as they do not impair the effectiveness of lamps and reflectors required by the standard. The initial determination of whether there is impairment is to be made by the manufacturer who certifies that the vehicle complies with all applicable Federal motor vehicle safety standards. If that decision app ears incorrect to the agency, NHTSA will advise accordingly.

After the initial sale, the supplementary reflective devices may be installed by a manufacturer, dealer, distributor, or motor vehicle repair business subject to the limitation in section 108(a)(2)(A) of the National Traffic and Motor Vehicle Safety Act that such installation not "render inoperative in whole or in part" any of the lighting equipment required by Standard No. 108. There is no statutory prohibition under the Act against owner modifications, even if they involve impairing or removing devic es required by Standard No. 108. However, the trailer would still remain subject to the laws of the individual States in which the trailer is registered and operated, and (if applicable), to the regulations of the Office of Motor Carrier Standards of th e Federal Highway Administration.

ID: nht90-4.50

TYPE: Interpretation-NHTSA

DATE: October 30, 1990

FROM: Marc J. Fink -- Dow, Lohnes & Albertson; Stephen C. Crampton -- Dow, Lohnes & Albertson

TO: Samuel K. Skinner -- Secretary, United States Department of Transportation

TITLE: Re Review of Arbitrary and Capricious Action by the National Highway Traffic Safety Administration

ATTACHMT: Attached to letter dated 1-3-91 to Stephen C. Crampton and Marc J. Fink from Jerry Ralph Curry (A37; Part 591; Sec 1397); Also attached to memo dated 10-31-90 from Toni Fargo to NHTSA

TEXT:

We are writing to ask you to reverse an arbitrary and capricious action by NHTSA and approve John A. Rosatti's proposed importation of his Porsche 959 as a "demonstration" vehicle. Mr. Rosatti's proposed uses for the car, as a promotional tool and addit ion to his automobile museum, are entirely consistent with the "demonstration" exemption, as codified by Congress and implemented by NHTSA. To assuage any concerns that the Porsche 959 will ever be driven on United States highways, Mr. Rosatti agrees to provide a written promise that the car will not be driven on any road or highway in the United States and that he will not sell the car to any United States resident. Mr. Rosatti also agrees to remove the engine from the car and take whatever other rea sonable actions may be required to satisfy NHTSA's concerns that the car not be driven on United States highways.

We find it necessary to appeal to you, Mr. Secretary, because we believe NHTSA's denial of Mr. Rosatti's request was arbitrary and capricious. Mr. Rosatti is considering a legal challenge to NHTSA's action, but would prefer to settle this matter without the unnecessary burden for both parties of a potentia lly protracted litigation.

We have the following objections to NHTSA's ruling: NHTSA's action is unrelated to its statutory mandate to "increase highway safety." NHTSA has failed to consider or discuss in any way Mr. Rosatti's proposed inclusion of the Porsche 959 in his automobi le museum. NHTSA has articulated an untenable interpretation of the "demonstration" exemption. Finally, and importantly, NHTSA's decision to allow another person to import a Porsche 959 for a museum while denying Mr. Rosatti's proposed importation for the same purpose is arbitrary and capricious.

John Rosatti has been in the automobile business for twenty five years; for the last fifteen years, he has owned and operated Plaza Motors of Brooklyn, Ltd.(1) Plaza Motors's grounds consist of buildings totalling approximately 75,000 square feet and co ver two city blocks. Plaza Motors holds Honda, Acura, and Oldsmobile dealerships, selling about 500 cars each month. Approximately 2000 to 3000 people come into Plaza Motors every week.

Dealers like Mr. Rosatti depend heavily upon promotional campaigns to attract buyers; indeed, Plaza Motors spends as much as $50,000 per month

on promotional activities. Mr. Rosatti's promotional plan for the Porsche 959 specifically involves his Acura dealership.(2) Acura cars are advertised as high-quality, exciting, and inexpensive alternatives to fancy European sports cars. Recent advert isements encourage car-buyers to trade in their expensive European cars for Acuras. In keeping with the Acura image, Mr. Rosatti intends to use his Porsche 959 to attract potential Acura buyers. As persons targeted for Acura sales are also likely to be interested in high-quality European sports cars, they will come to see a Porsche 959 on display. When they come, Mr. Rosatti will then have the opportunity to explain the benefits of his sporty, yet affordable, Acuras.

To implement his promotional plan, Mr. Rosatti envisions running numerous advertisements in newspapers and on the radio, enticing potential car-buyers to come and see the Porsche 959. Mr. Rosatti intends to place the Porsche 959, along with his Ferrari Testarossa, Lamborghini Contach, Specially built Porsche 935, and Mark IV Cobra, in a museum located on Plaza Motors's premises. Preliminary estimates are that such an automobile demonstration could attract as many as 1000 additional persons per month t o the dealerships. Completely in line with NHTSA regulations, John Rosatti intends to import the Porsche 959 as a commercial demonstration model.

NHTSA's new regulations, implementing the Imported Vehicle Safety Compliance Act of 1988, provide a "demonstration" exemption from restrictions on imports of motor vehicles that do not comply with NHTSA safety requirements.(3) " Mr. Rosatti's proposed us e of his Porsche 959 falls under the plain language of NHTSA's regulation and the statute. Indeed his proposed use is consistent with uses mentioned in the Supplementary Information accompanying the new rules.

The Supplementary Information accompanying NHTSA regulations states as follows:

Importation for this class of noncomplying motor vehicles (i.e., demonstration or display vehicles) has been permitted pursuant to the assumption that motor vehicle safety would not be affected by the temporary importation of noncomplying motor vehicles not generally used on the public roads, and whose appearance on them would be limited.(4)

NHTSA's Supplementary Information specifically sanctions automobile manufacturers' display of cars for commercial use.(5) Like manufacturers, Mr. Rosatti intends to display his car to promote sales. The Porsche 959 would, he believes, serve as a powerf ul attraction, drawing people to his automobile dealerships. Also like manufacturers, Mr. Rosatti will not drive the car. There is therefore no distinction between Mr. Rosatti's proposed use and the commercial display of a car by an automobile manufact urer. NHTSA's own rationale and regulations dictate that permission be given to Mr. Rosatti to import his car for demonstration purposes.

Mr. Rosatti also has a second interest in importing the Porsche 959, one that also accords entirely with the concept of a demonstration car. NHTSA's Supplementary Information manifests a concern that museums are not

to be deprived of interesting and valuable items in their collection, stating that museums can import cars under the 25-year exception.(6) Mr. Rosatti's Porsche 959 is both interesting and valuable to automobile enthusiasts. Although Mr. Rosatti's car i s less than 25 model-years old and thus would not fit within the 25-year exception, its importation for use in a car museum conforms to the language and policy of the demonstration exemption.

Mr. Rosatti's motivations for wanting to import his Porsche 959 are simple. Mr. Rosatti is interested in combining his passion for automobiles and pride in his accomplishments in the automobile business with his commercial enterprise. To Mr. Rosatti, th e Porsche 959 and his other collector automobiles represent his success in the automobile industry, an industry to which Mr. Rosatti has devoted his working life. The Porsche 959 is the greatest trophy in his collection of cars. Mr. Rosatti naturally w ants to show off his cars, both for their commercial value and appeal and because they represent his achievements in the automobile industry.(7)

NHTSA's mandate is to "increase highway safety,"(8) but NHTSA fails to explain how highway safety is threatened by Mr. Rosatti's proposed importation. Mr. Rosatti informed NHTSA in his letter-request that he will agree to any reasonable restriction rega rding his use of the Porsche 959 in the United States. Mr. Rosatti has stated that he is willing to remove the engine from the car and display it in a separate area of the museum, apart from the car body. Mr. Rosatti further has agreed to sign a writte n attestation that he will not drive the car nor sell it to a United States resident.(9) However, in its response to Mr. Rosatti's request, NHTSA refused to discuss the reasonableness of Mr. Rosatti's proposed self-imposed restrictions and failed to sug gest any alternative reasonable restrictions on Mr. Rosatti's use of the Porsche 959 in the United States. NHTSA's action is thus unrelated to NHTSA's mandate.

Mr. Rosatti hand-delivered his request upon NHTSA on May 25, 1990. It took four months for NHTSA to respond to Mr. Rosatti's request and, despite the fact that the New York State Board of Education chartered his museum, NHTSA failed to refer to Mr. Rosa tti's proposed museum in its September 20, 1990 response. We are enclosing (as Attachment C) a copy of Mr. Rosatti's May 25, 1990 request, our letter of September 18, 1990, with the enclosed letter from the New York Education Department and the vote ado pting the charter, and NHTSA's September 20, 1990 response to Mr. Rosatti's request.(10) NHTSA's belated response and failure to address a major argument in favor importing Mr. Rosatti's Porsche 959 is arbitrary and capricious.(11)

Further, NHTSA's interpretation of the "demonstration" exemption is untenable. NHTSA asserts that demonstration does not encompass "static display" and thus differs from the "show" exemption in earlier regulations. The term demonstration, however, come s from the Latin demonstrare 'to show'.(12) Also, the definition of demonstration includes "display." On its face, therefore, the term demonstration encompasses display in a museum. Indeed, there is absolutely no evidence that Congress or NHTSA intend ed to effect a major change in the exemption through a mere exchange of synonyms. NHTSA states in its letter that the Imported Vehicle

Safety Compliance Act of 1988 changed the law in an attempt to reduce the "number of nonconforming vehicles . . . imported into the United States without sufficient assurances or evidence that they were being brought into compliance with all applicable F ederal safety standards." However, the Act was not directed primarily toward "show" or "demonstration" cars, but toward imports that are to be brought into conformance with NHTSA standards. As NHTSA's Supplementary Information to the current regulatio ns confirms, "(t)his is the category of motor vehicle that is most affected by the 1988 amendments."(14)

NHTSA's interpretation would render the "demonstration" exemption duplicative and irrelevant, and clearly Congress did not intend that. In its letter, NHTSA states the following:

(W)ith respect to the new regulation, we have interpreted the word "demonstration" only in the context of allowing importation of nonconforming vehicles by registered importers who wish to prove, or demonstrate, that the vehicle is capable of conformance modification under one of the provisions of 1397 (c) (3) (A) (i).

Nothing in the Act or NHTSA regulations suggests such an interpretation. If a registered importer can prove that its vehicle is capable of modification under 49 C.F.R. S 1397 (c) (3) (a) (i) (1989), then the vehicle is exempt under that section and the " demonstration" exemption is duplicative. If, on the other hand, NHTSA is suggesting that the demonstration exemption is actually a procedural rule of proof for persons seeking exemption under 49 C.F.R. S 1397 (c) (3) (a) (i) , then that interpretation l ikewise conflicts with the Act. The Act explicitly provides procedures for importing a car under Section 1397 (c) (3) (a) (i): the importer furnishes a bond and complies with "such terms and conditions as it appears to the Secretary (of the Treasury) to be appropriate."(15) Indeed, the Act goes on to provide a calculation for the bond, procedures for persons whose registration has been revoked, a requirement that the importer maintain custody of the car, a label requirement, and a requirement that eac h registered importer maintain evidence that it has resources to complete the modification.(16)

Not only is NHTSA's interpretation of the exemption contrary to law, but its application to John Rosatti is arbitrary. Recently, NHTSA granted a "demonstration" exemption to Otis Chandler allowing importation of a Porsche 959.(17) NHTSA allowed Mr. Cha ndler to include his Porsche 959 in his automobile museum collection in Oxnard, California. Yet, John Rosatti's application for prior approval to use the same car in the same circumstances yields a different result. As mentioned before, the New York St ate Board of Regents has granted a charter for Mr. Rosatti's car museum. Mr. Rosatti has provided NHTSA with proposed promotional materials for his museum and has named the other cars that will form the initial museum collection: a Ferrari Testarossa, L amborghini Contach, specially built Porsche 935, and Mark IV Cobra. NHTSA has failed to explain why Mr. Rosatti's proposed importation is different from Mr. Chandler's.

Mr. Rosatti is not asking for special treatment. Mr. Rosatti asks only that the proposed importation of his Porsche 959 be fairly considered and that he be treated like other Porsche 959 importers. Mr. Rosatti has

offered proof of his intention never to drive the Porsche 959 in the United States and, indeed, welcomes any necessary further inquiry into his proposed use of the Porsche 959. Mr. Rosatti has agreed to remove the engine from the car and to provide a wr itten promise that the car never will be driven in the United States. New York State has chartered Mr. Rosatti's automobile museum. In light of these facts, uncontroverted by NHTSA, Mr. Rosatti's proposed use of the Porsche 959 falls within the meaning and the policy of the "demonstration" exemption. We therefore respectfully request that you reverse NHTSA's determination on the issue and approve Mr. Rosatti's proposed importation.

Footnotes: (1) Copies of recent newspaper advertisements for Plaza are appended to this letter as Attachment A.

(2) Advertising proposals for the Acura/Porsche 959 advertising campaign are appended to this letter as Attachment B.

(3) The Imported Vehicle Safety Compliance Act of 1988, 102 Stat. 2818, 2824 (to be codified at 15 U.S.C. 1397 (j)), provides that "(t) he Secretary may exempt any motor vehicle or item of motor vehicle equipment... upon such terms and conditions as the Secretary may find necessary solely for the purpose of ... demonstrations." The NHTSA regulation implementing this provision of the statute, 49 C.F.R. 591.5 (j) (1989), states as follows: No person shall import a motor vehicle or item of motor vehicle equipment into the United States unless, at the time it is offered for importation, its importer files a declaration, in duplicate, which declares...(t) he vehicle or equipment item does not conform with all applicable Federal motor vehicle safety, bumper, and theft prevention standards, but it (sic) being imported solely for the purpose of ...demonstrations.

(4) 54 Fed. Reg. 40,069, 40,076 (Sept. 23, 1989).

(5) The Supplementary Information interprets "demonstration" cars as including "nonconforming products for display at automobile shows to gauge public reaction to new styling or engineering features." Id.

(6) Id.

(7) To further exhibit his car, if permitted Mr. Rosatti would transport it to automobile shows, in particular, monthly Porsche-club shows at the Jacob Javits Center.

(8) See 23 U.S.C. 401 (1988); 49 U.S.C. 105(c) (1) (1988).

(9) Indeed, the value of the car as a collector's item would be seriously diminished if it were to be driven on roads surrounding Mr. Rosatti's dealership in New York City.

(10) We are also enclosing (as Attachment D) a letter, dated September 27, 1990, from another NHTSA official, offering "(o) ne last thought on a matter that may not be covered (in the September 20, 1990 letter, regarding)...importation for museum purpose s." This letter, written by a

NHTSA official outside the NHTSA Chief Counsel's office, states without analysis that museums may only import cars over 25 years old. This conclusory museums may only import cars over 25 years old. This conclusory statement hardly constitutes an adequa te response by NHTSA to Mr. Rosatti's proposed museum. This is especially so in light of the fact that NHTSA recently allowed another automobile-museum owner to import a car less than 25 years old. See infra p. 7.

(11) See 5 U.S.C. 555 (e) (1988) (agency required to give prompt notice of and grounds for denial of an informal request).

(12) Webster's Ninth New Collegiate Dictionary at 338 (1988). As NHTSA apparently adopted Webster's definition of show, there is no reason not to adopt its authority on the meaning of demonstration. In its letter, NHTSA states that it defines show as " to cause to be seen," Attachment C at 14; Webster's first definition of show is "to cause or permit to be seen." Webster's Ninth New Collegiate Dictionary at 1091.

(13) Id. at 338.

(14) 54 Fed. Reg. 40,069, 40,073 (Sept. 23, 1989).

(15) 102 Stat. 2818 (to be codified at 15 U.S.C. 1397 (c) (2)).

(16) Id. at 2818-22 (to be codified at 15 U.S.C. 1397 (c) (2) (B) to 1397 (d) (2)).

(17) Attachment E to this letter is a copy of Colman, The Vigil, Excellence Magazine, October, 1990, at 60, chronicling Mr. Chandler's importation of a Porsche 959.

ID: nht90-4.51

TYPE: Interpretation-NHTSA

DATE: October 31, 1990

FROM: Toni Fargo -- Executive Secretariat, Office of the Secretary of Transportation

TO: NHTSA

TITLE: Re REVIEW OF ARBITRARY AND CAPRICIOUS ACTION BY THE NHTSA AND APPROVE JOHN A. ROSATTI'S PROPOSED IMPORTATION OF HIS PROSCHE 959 AS A "DEMONSTRATION" VEHICLE

ATTACHMT: Attached to letter dated 1-3-91 to Stephen C. Crampton & Marc J. Fink from Jerry Ralph Curry (A37; Part 591; Sec 1397); Also attached to letter dated 10-30-90 to Samuel K. Skinner from Marc J. Fink & Stephen C. Crampton

TEXT:

IF YOU ARE UNABLE TO PROVIDE THE REQUIRED INFORMATION, PLEASE ADVISE YOUR ANALYST NO LATER THAN 24 HOURS AFTER THE RECEIPT OF THIS DOCUMENT. THIS SHEET MUST REMAIN WITH THE INCOMING DOCUMENT AND BE RETURNED WITH YOUR RESPONSE. YOUR PROMPT ACTION IS AP PRECIATED.

ID: nht90-4.52

TYPE: Interpretation-NHTSA

DATE: November 1, 1990

FROM: Mitch L. Williams -- President, Hella Inc.

TO: Richard Van Iderstine -- Office of Vehicle Safety Standards

TITLE: Re Proposed new product from Hella

ATTACHMT: Attached to letter dated 11-8-90 from Mitch L. Williams to Richard Van Iderstine; Also attached to letter dated 12-24-90 from Paul Jackson Rice to Mitch L. Williams (A37; FMVSS 108)

TEXT:

Hella is considering introducing a new product which could have certain safety implications. We are considering introducing a range of rear spoilers with integrated third rear brake lights. Obviously, for vehicles which are not equipped originally with third rear brake lights, this would upgrade them to current safety standards.

Our question is from a regulatory viewpoint, how would NHTSA view the addition of a rear spoiler with integrated third rear brake light to a vehicle already originally equipped with a third rear brake light? Could you be so kind as to give us an opinion on this matter?

Thank you for your assistance in this matter.

ID: nht90-4.53

TYPE: Interpretation-NHTSA

DATE: November 6, 1990

FROM: J. P. Henries -- Captain, Safety Officer, Virginia State Police

TO: Paul Jackson Rice -- Chief Counsel

TITLE: None

ATTACHMT: Attached to letter dated 12-26-90 from P.J. Rice to J.P. Henries (A37; Std. 208)

TEXT:

Attached you will find a copy of your letter of September 10, 1990, to Mr. Rembert Ryals, Esq., concerning an interpretation of Standards No. 208 and 209.

At present the rules and regulations of Virginia's Official State Inspection Program require any 1963 and subsequent model vehicle designed and licensed primarily for passenger use, to be equipped with adult safety lap belts for at least two front seats or a combination of lap belts and shoulder straps or harnesses.

In your letter to Mr. Ryals, you describe certain vehicles which were permitted to be manufactured without lap belts if they meet certain criteria. This being the case, how can our safety inspectors readily identify a vehicle which is not required to be equipped with a lap belt?

Your assistance in this matter is appreciated.

ID: nht90-4.54

TYPE: Interpretation-NHTSA

DATE: November 7, 1990

FROM: Paul Jackson Rice -- Chief Counsel, NHTSA

TO: Lawrence W. Rusk -- Project Engineer, Drum Brakes, Bendix Automotive Systems, Allied-Signal, Inc.

TITLE: None

ATTACHMT: Attached to letter dated 9-28-90 from L.W. Rusk to P.J. Rice (OCC 5264)

TEXT:

This responds to your recent inquiry concerning adjustment procedures for hydraulic brakes during testing in accordance with Federal Motor Vehicle Safety Standard No. 105; Hydraulic Brake Systems. You asked whether, following the revisions effective Sep tember 1, 1991, the Standard will authorize manual brake adjustment on a vehicle equipped with duo-servo brakes and automatic brake adjusters following the initial burnish and three subsequent reburnishes. Although your letter did not specify that the f ocus of your inquiry is vehicles with a GVWR of 10,000 pounds or less, based on the context of your letter, I am assuming that this is the case. The answer to your question is yes, if manual adjustment is the published procedure recommended by the vehic le manufacturer.

Standard 105 currently provides that where automatic brake adjusters have been locked out during testing, the brakes may be manually adjusted following the initial burnish and each subsequent reburnish. Where the automatic adjusters have not been locked out, the Standard requires that the brakes be adjusted at these points by making stops in accordance with the manufacturer's recommendations. See, S7.4.1.2, S7.6, S7.12 and S7.14.

On September 29, 1989, NHTSA published a final rule (54 FR 40080) which requires that as of September 1, 1991, for all vehicles equipped with automatic brake adjusters being tested to Standard No. 105, that the automatic adjusters be operational during t he test. In addition, the rule revises the provisions in S7.4 governing brake adjustment after burnish to delete language requiring that vehicles equipped with automatic adjusters be adjusted by making stops in accordance with the manufacturer's recomme ndations. These provisions are revised to state that following each specified burnishing, the brakes are to be adjusted in accordance with the manufacturer's published recommendations (e.g. recommendations set forth in service literature). Thus, if the manufacturer recommends that the brakes be adjusted manually, notwithstanding the automatic adjusters, they are to be manually adjusted. Alternatively, if the manufacturer recommends that the brakes be adjusted by completing a series of specified stops , that procedure must be followed.

In conclusion, under the new provisions in Standard No. 105, brakes on a vehicle with automatic brake adjusters and a GVWR of 10,000 pounds or less should be manually adjusted at the end of the initial and subsequent burnishes if the manufacturer's publi shed recommendations call for manual adjustment.

I hope you find this information helpful. If you have further questions, please do not hesitate to contact David Greenburg of my staff, at (202) 366-2992.

ID: nht90-4.55

TYPE: Interpretation-NHTSA

DATE: November 7, 1990

FROM: Lennard S. Loewentritt -- Deputy Associate General Counsel, Personal Property Division, General Services Administration, Office of General Counsel

TO: Paul Jackson Rice -- Chief Counsel, NHTSA

TITLE: None

ATTACHMT: Attached to letter dated 2-26-91 from Paul Jackson Rice to Lennard S. Loewentritt (A37; Part 571.7(c))

TEXT:

We are in receipt of your August 23, 1990 letter regarding applicability of the exception in 49 CFR 571.7(c) to buses purchased by the General Services Administration's (GSA) use of Interagency Fleet Management System (IFMS) for the Sole the Armed Forces . The exception states that Federal motor vehicle safety standards do not apply to vehicles that are "manufactured for, and sold directly to, the Armed Forces of the United States, in conformity with contractual specifications." This exception has perm itted the Army to acquire vehicles designed to satisfy multi-use requirements, specifically buses equipped with seating designed for adults and painted in a color other than school bus yellow. This exception made it possible for the Army to utilize the buses for their primary mission of troop movement, and, as needed, for transporting military dependents to and from school.

In our letter to Mr. Felrice dated February 2, 1990, we requested a deviation for "vehicles or items procured by GSA's IFMS for use solely by the Army." We believe this language may have caused confusion concerning the IFMS's role in purchasing vehicles and may have led to the erroneous assumption that the IFMS acts as a purchasing agent for the Army. GSA plays two roles with respect to the purchase of vehicles. GSA's Automotive Center acts as a purchasing agent for agencies that wish to purchase veh icles through GSA. In addition, GSA purchases vehicles for its own fleet, the IFMS. These vehicles are assigned on an indefinite basis to agencies that have had their fleets consolidated into the IFMS. These agencies are charged a monthly fee for use o f the vehicles assigned the them. In 1985, the Army began a program to consolidate approximately 45,000 nontactical vehicles into the IFMS. The program is currently being completed and, as a result, the IFMS is now responsible for purchasing and leasin g vehicles for the use by the Army. The potential to consolidate the Air Force's fleet and to provide similar services also exists.

In the case at hand, the IFMS would be purchasing buses for indefinite assignment to and sole use by the Army for the purpose of transporting troops as well as transporting military dependents to and from school. In the remote event that any such bus we re reassigned to another agency, IFMS would require that it be used solely for the transport of adults. Although IFMS would not be acting as a purchasing agent, we still believe that a deviation is proper, and we request that NHTSA grant a deviation for buses procured by GSA IFMS and assigned for use by the Armed Forces, such vehicles to be manufactured in accordance with contractual specifications. GSA would use specifications for buses which reflect the requirements of the Federal Motor Vehicle Safet y Standards for buses

rather than school bus specifications.

We believe a deviation from the requirements in 49 CFR 571.7 to permit buses purchased by IFMS to be assigned solely to the Armed Forces would be appropriate. This deviation would allow the Army and any other consolidated military activities to continue to use the buses for the purpose of transporting adults as well as military dependents, without requiring them to purchase school buses specifically designed for this latter purpose. This deviation would not permit any transportation of children that i s not already permitted by the current exception in 49 CFR 571.7(c).

Pursuant to the additional information provided in this letter explaining that GSA, in this case, is not a purchasing agent for the Armed Forces, but rather provides motor vehicles to the Armed Forces under the authority of section 211 of the Federal Pro perty and Administrative Services Act of 1949, as amended (40 U.S.C. 491) which provides for fleet services for use by Executive agencies, including the Armed Forces, we request that NHTSA grant a deviation from 49 CFR 571.7 to permit procurement of and assignment by the IFMS of buses for use by the Armed Forces.

If we may provide any assistance or further information concerning this request, please contact me on 501-1156.

ID: nht90-4.56

TYPE: Interpretation-NHTSA

DATE: November 8, 1990

FROM: Mitch L. Williams -- President, Hella, Inc.

TO: Richard Van Iderstine -- Office of Vehicle Safety Standards; NHTSA

TITLE: Re Proposed new product from Hella

ATTACHMT: Attached to letter dated 12-24-90 from Paul Jackson Rice to Mitch L. Williams (A37; FMVSS 108); Also attached to letter dated 11-1-90 from Mitch L. Williams to Richard Van Iderstine (OCC 5441)

TEXT:

In addition to my letter to you of November 1, 1990, Hella is considering another new product which could have vehicle safety implications.

As you know, pick-up trucks are not currently required to have a third brake light originally equipped. We feel that adding a third brake light to these vehicles would significantly reduce the chances of rear end collisions for the following reasons:

A) Pick-up trucks are selling in record numbers and are becoming a larger portion of the vehicle population, therefore diluting safety advantages created by adding third rear brake lights to automobiles in 1986.

B) Pick-up trucks are among the most difficult vehicles on the road for a following driver to see around. Any added safety must have a positive effect for following drivers.

Since there are no current regulations on this subject, Hella would like to ask NHTSA's opinion on the following questions:

1) Does NHTSA agree with Hella that a third brake light would be an added safety feature for pick-up trucks?

2) Does NHTSA intend to regulate this subject matter and if so, when and how?

3) The major technical point for us as manufacturers is where to mount the third lamp. The obvious place is on the tailgate, but this presents certain technical problems such as operating the vehicle with the tailgate down, and insuring a good electrical connection with a tailgate which moves. Also a good place is the upper edge of the back window, but for trucks with caps or campers on them, this will not work. Assuming NHTSA will address this area, how will NHTSA view the mount ing location?

Thank you in advance for your consideration.

ID: nht90-4.57

TYPE: Interpretation-NHTSA

DATE: November 9, 1990

FROM: Paul Jackson Rice -- Chief Counsel, NHTSA

TO: W.C. Glasscock -- Sun-Cool & Co.

TITLE: None

ATTACHMT: Attached to letter dated 9-4-90 from W.C. Glasscock (OCC 5237)

TEXT:

This responds to your letter concerning the installation of aftermarket tinting on motor vehicle windows. According to your letter, you have been involved in the window tinting business for many years but only recently became aware of the fact that Fede ral law prohibits businesses from adding tinting film to motor vehicle windows if it reduces the level of light transmittance below that required by the Federal standard. You expressed concern that there appears to be a conflict between Federal and stat e law in this area and that there has been a lack of enforcement of the Federal requirement.

We are pleased that you have become aware of the Federal requirement in this area and that you are apparently now complying with it. As you may have heard, we have brought suit against six tint businesses in Florida. Those cases are pending in Federal c ourt. We also plan to take appropriate steps to enforce the Federal requirement in other parts of the nation.

I will now discuss the relationship between Federal and state law in this area. The National Highway Traffic Safety Administration ("NHTSA") is responsible for issuing Federal motor vehicle safety standards that establish requirements for specific level s of safety performance for new motor vehicles and motor vehicle equipment. Federal Motor Vehicle Safety Standard No. 205, Glazing Materials (49 CFR S571.205), which has been in effect since 1968, imposes a minimum level of light transmittance of 70 per cent in all areas requisite for driving visibility (which includes all windows on passenger cars). The purpose of this requirement is to ensure adequate visibility through the windows, thereby reducing the risk of a motor vehicle crash.

Although Federal motor vehicle safety standards apply directly only to new vehicles and equipment, Federal law also imposes limits on the addition of tinting materials to motor vehicle glazing after vehicles have been purchased by consumers. Pursuant to section 108(a)(2) of the National Traffic and Motor Vehicle Safety Act, 15 U.S.C. 1397(a)(2), manufacturers, distributors, dealers, or motor vehicle repair businesses may not "render inoperative" any equipment or element of design installed in complianc e with a Federal safety standard. Thus, those businesses may not install tinting that reduces the light transmittance of windows covered by Standard 205 to a level below the Federal requirement of 70 percent, since that would make the windows "inoperati ve, within the meaning of Standard 205.

You stated that state laws differ from the Federal law, citing as an example an Illinois law which, according to your letter, allows tinting on the rear and sides of vehicles as long as the vehicle's owner has a letter

from a physician licensed to practice in the state of Illinois that explains the medical basis for the need.

The "render inoperative" provision of Federal law does not apply to actions by individual vehicle owners. Therefore, each State may regulate the extent to which after market tinting may be applied by vehicle owners to their own vehicles.

However, no state has the authority to grant any exemptions from the "render inoperative" prohibition of Federal law that applies to commercial entities. Hence, regardless of any provisions of state law, no manufacturer, distributor, dealer, or motor ve hicle repair business may legally install window tinting film on a vehicle, unless the vehicle continues to comply with the Federal light transmittance requirements.

I hope this information is helpful.