United States Department of TransportationInterpretation ID: aiam1901
House of Representatives
Washington
DC 20515;
Dear Mr. Mahon: This is in response to your letter of February 13, 1975, forwarding a article from Modern Tire Dealer which cited a speech by Len Barnes of the Automobile Club of Michigan. Mr. Barnes' speech concerned the National Highway Traffic Safety Administration's (NHTSA) Tire Identification and Record Keeping regulation. As we advised you in our letter of March 7, 1975, we believe the questions raised in Mr. Barnes' speech should be answered fully, and delayed our response until we could review our own data in this area.; By Act of Congress (Public Law 91-265), the National Traffic and Moto Vehicle Safety Act was amended in 1970 to require manufacturers and retreaders of tires to maintain the names and addresses of first purchasers so that owners of defective tires may be notified of any defect. The legislative history of this amendment makes it clear that the Congress recognized the need for regulations in the area. Earlier joint attempts by manufacturers and the National Highway Traffic Safety Administration to notify purchasers of defective tires produced inadequate results even in cases where the manufacturer offered to replace the defective tires free of charge. The poor results were attributable to the fact that owners could not be directly notified of the defect.; The magnitude of the problem which the regulation seeks to alleviate i clear. Since the inception of the program in 1966 through 1973, there have been 1,427,670 tires recalled in 88 separate defect recall campaigns. In 1973 alone, there were 116,743 tires recalled in 11 defect recall campaigns, rather than 'less than 100,000' as Mr. Barnes suggests. Further, information available to NHTSA indicates that the cost figure of 75 cents for each tire registration cited in Mr. Barnes' speech is too high, and that the actual processing cost is nearer to 25 cents. While it may be that the higher figure includes the labor cost attributable to salesmen filling out the forms and the office secretary mailing them to the manufacturer, we feel it is highly unlikely that the regulation necessitates hiring additional dealer staff.; Even utilizing Mr. Barnes' cost figures, however, it is NHTSA's vie that 75 cents for each tire registration is not an exorbitant expense in terms of insuring that a motorist will be advised if a tire he purchased is defective and could lead to death, a serious injury, or damage to his vehicle. As a comparison, an average family belonging to the Automobile Club of Michigan, which employs Mr. Barnes, would pay $68.00 or more for the road service protection and travel information offered by the club over the same two year period he was paying 75 cents per tire for defect insurance.; Mr. Barnes also suggests that consumers pay $1,100 for each defectiv tire recalled. This argument is clearly spurious, and ignores the basic purpose of insurance, including that marketed by Mr. Barnes' employer. Even using Mr. Barnes' figure, however, we consider $1,100 a small price to pay to save a life or avoid an injury. You may also be interested to note that a Federal jury in Florida recently returned a $2,300,000 verdict against Sears Roebuck & Company in a tort action involving a defective tire.; With regard to the effectiveness of the recordkeeping regulation, ou records indicate the percentage of tires being recorded is increasing, and should continue to increase when additional enforcement action is taken against manufacturers and dealers who do not comply with the regulation. Further, the percentage of tire failures has fallen from 6% in the 1968-69 period to less than 1% during 1974. Of course, what is most needed to make the regulation effective is the voluntary cooperation of retreaders and dealers in recording, reporting and maintaining the required information.; While this regulation indisputably places an added responsibility o retailers, we also believe that the burden is neither onerous nor unjustified in view of the danger to the consumer. The NHTSA has continually attempted to improve and simplify the procedures for the registration of tires, the most recent example being the Universal Tire Registration Format issued on June 3, 1974.; The alternative suggested by Mr. Barnes, utilizing governmen inspectors, would in our view be even more expensive than the current procedure. There are 67 new tire plants and over 6,000 retreading shops in the United States and many more abroad. To establish Federal inspectors and test equipment in each plant would be enormously expensive. Further, it would run counter to the basic premise of the Motor Vehicles Safety Program which is that manufacturers are self-certifiers, and must take full responsibility for defective vehicles and equipment they place on the market.; For these reasons, we are convinced that the requirement that dealer record the name and address of tire purchasers at the time of sale is reasonable and appropriate.; Sincerely, James B. Gregory, Administrator