ID: Alliance Letter - Sale of Electronic Odometer Resetting Devices

ID: alliance(9-2-03).ajd

Mr. Robert S. Strassburger
Vice President
Vehicle Safety and Harmonization
Alliance of Automobile Manufacturers, Inc.
1401 H Street, NW, Suite 900
Washington, D.C. 20005

Dear Mr. Strassburger:

This is in reply to your letter of September 2, 2003, regarding my July 21, 2003 letter to Mr. Cavallo of Halcore Group, Inc., which discussed the early warning reporting (EWR) responsibilities of small volume manufacturers.

I had advised Mr. Cavallo that "[f]or the purposes of determining whether the production of vehicles meets or exceeds the 500 vehicles per year threshold in Section 579.21 et seq., the production of the divisions, parent, subsidiaries and affiliates must be aggregated." This interpretation is consistent with other letters interpreting the EWR regulation.See Letter from Jacqueline Glassman to John D. Evans of April 11, 2003, at p. 3; Letter from Jacqueline Glassman to Rod Nash of August 20, 2003, at p. 2; and Letter from Jacqueline Glassman to Rod Nash of October 10, 2003.

You assert that the interpretation that I provided to Mr. Cavallo was inconsistent with statements made by a person other than the Chief Counsel at a public meeting. The September 24, 2002 public meeting you reference concerned technical issues, such as security and acknowledgement of submissions, regarding electronic EWR submissions to the agency. The Federal Register Notice announcing this meeting was clear that this was to be only a technical meeting. See 67 FR 55448. Moreover, at the time of the meeting, we expressly stated that the information presented was not binding upon the agency, and that nothing stated at the meeting should be construed as a final NHTSA interpretation. Transcript p. 8. [1] In addition, the Alliance of Automobile Manufacturers (Alliance) and its members are familiar with NHTSAs interpretive processes. As such, the Alliance is fully aware that the Chief Counsel is the only NHTSA official with authority to issue interpretations of agency regulations. See 49 CFR 501.8(d)(4).

Second, you state that the interpretation in the Cavallo letter is inconsistent with how the agency intends to use the information collected from EWR, as stated in the final rule. You also said that the value in the information provided by low volume manufacturers is very limited when conducting trend analysis because a single incident can look like a high "incident rate" relative to the performance of other vehicles manufactured in larger quantities. In addition, you concluded that "the agencys guidance from September 2002 public meeting regarding the limited reporting requirements for low volume subsidiaries makes sense in the overall context of the EWR rule and the uses to which NHTSA plans to put the EWR information."

We disagree with your conclusion. The statement was not "the agencys guidance." We determined that the 500 unit production threshold is the appropriate demarcation point in part based on small business concerns. We also determined that aggregate reporting is appropriate in order to capture all vehicles manufactured by an entity with affiliates or subsidiaries. Moreover, while a single incident may skew the "incident rate" relative to other vehicles, it is not the only factor that controls NHTSAs initiation of a defect investigation or the determining factor in deciding to issue an initial determination. Also, EWR information will not be the sole basis for opening a defect investigation. As we stated in the preamble to the final rule, "if we identify matters that might possibly suggest the existence of a defect, we plan to seek additional clarifying information from the manufacturer in question, and from other sources, to help us to decide whether to open a formal defect investigation." 45822 FR at 45865. We see no reason to vary from our current position.

Lastly, you stated that, in the context of FMVSS No. 208 phase-in requirements, the agency in an interpretation letter previously determined that low volume subsidiaries of larger parent companies retain their low volume status. As you recognize in your letter, a letter interpreting FMVSS No. 208 does not control the interpretation of the EWR regulation. We also noted in that letter that the interpretation provided therein only reflected consideration of factors underlying FMVSS No. 208, and did not provide guidance for interpreting any other regulatory provisions. See Letter from John Womack to Grant Nakayama of August 22, 2001. We do not believe that the concerns underlying that interpretation letter are the same as those underlying the EWR regulation. First, the exclusion of low volume subsidiaries from the phase-in requirements of FMVSS No. 208 reflected the technical challenges faced by smaller manufacturers given the complexity of the advanced air bag requirements. Second, that exclusion simply deferred compliance with the advanced air bag rule by low volume subsidiaries to the end of the phase-in period. In contrast, your suggestion would, in effect, totally exclude low volume subsidiaries from the comprehensive reporting requirements of the EWR regulation.

If you have any questions, you may call Andrew DiMarsico of this Office (202-366-5263).

Sincerely,

Jacqueline Glassman
Chief Counsel

ref:579
d.11/4/03





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[1] Docket NHTSA 2001-8677-530. Available at http://dms.dot.gov.

ID: Alliance.1

Robert Strassburger, Vice President
Vehicle Safety & Harmonization
Alliance of Automobile Manufacturers
1401 Eye Street, NW, Suite 900
Washington, DC20005-6562




Dear Mr. Strassburger:

This acknowledges receipt of your October 24, 2005, letter regarding our September 7, 2005, final rule responding to petitions for reconsideration under Federal Motor Vehicle Safety Standard (FMVSS) No. 138, Tire Pressure Monitoring Systems (TPMS)(70 FR 53079). Specifically, your letter raised an issue with paragraph S4.4(c)(2) of the standard, which sets requirements for flashing a combined low tire pressure/TPMS malfunction telltale for a period of 60-90 seconds to indicate to the driver when one or more malfunctions in the TPMS have occurred. The Alliance believes that this provision of the standard, as explained in the final rule, is design restrictive to the extent that the flashing sequence for a combined TPMS telltale is permitted only once per ignition cycle, regardless of the number of TPMS malfunctions encountered. Your letter also, argued that there is not a safety need to restrict the combined TPMS telltale to a single flashing sequence in the rare event of multiple TPMS malfunctions.

According to the Alliance, many current TPMSs have design architectures that automatically send a TPMS malfunction alert each time a new malfunction is detected, and you suggested that for manufacturers using such systems, a redesign would not be practicable before the September 1, 2007, compliance date for the TPMS malfunction indicator requirement. Consequently, your letter requested that the agency permit, but not require, vehicle manufacturers to install TPMSs with combined telltales that reinitiate the prescribed flashing sequence upon detection of subsequent TPMS malfunctions. Your letter sought this result either through a letter of interpretation of S4.4(c)(2), or alternatively, you asked that your letter be treated as a petition for reconsideration of the September 7, 2005, final rule.

Given the language of the standard and the preambles generally clear explanation of the agencys expectations regarding the requirements of S4.4(c)(2), we do not believe that the issue you have raised is amenable to a response via a letter of interpretation. Accordingly, we have decided to treat your letter as a petition for reconsideration of the final rule, and after careful consideration of the issue you have raised, we will respond accordingly.

If you have further questions, please feel free to contact Mr. Eric Stas of my staff at (202) 366-2992.

Sincerely,

Stephen P. Wood
Acting Chief Counsel

cc: Docket No. NHTSA-2005-22251
ref:138
d.12/21/05

ID: Alliance.jeg

Robert S. Strassburger, Vice President
Vehicle Safety and Harmonization
Alliance of Automobile Manufacturers
1401 H Street, NW
Suite 900
Washington, DC 20005

Dear Mr. Strassburger:

This responds to your letter seeking our concurrence that "Alliance members are allowed to combine the fleets of motor vehicle manufacturing subsidiaries owned by Alliance members for purposes of determining the overall fleet compliance with the compliance percentages set forth in various safety standard phase-in requirements." As discussed below, we generally agree with your suggested interpretation.

In your letter, you note that, in our mid-1980s rulemaking establishing the phase-in requirements associated with automatic occupant protection requirements for passenger cars, we addressed the need to accommodate complex relationships among manufacturers. See NPRM proposing phase-in requirements for Standard No. 208, 50 FR 14589, 14595-97, April 12, 1985. In that rulemaking, we adopted an attribution rule that generally permits companies to agree among themselves which entity will be treated as the manufacturer for purposes of meeting the phase-in percentages when any of those companies could be considered the "manufacturer." We have adopted similar attribution rules in subsequent rulemakings involving phase-ins.

You state in your letter that "(a)s Alliance members have consistently interpreted these phase-in requirements, member companies with ownership interests in other motor vehicle manufacturers have been able to combine the fleets for reporting purposes to the agency."

You note, however, that in a recent interpretation to Mr. Nakayama of Kirkland & Ellis regarding the status of certain small volume manufacturers, we observed:

(T)he vehicles of related manufacturers are not ordinarily grouped together for purposes of determining compliance with phase-ins of new safety standards. We note that this is in contrast to determinations of compliance with fuel economy standards, where vehicles of related manufacturers are grouped together. However, the grouping of vehicles of related manufacturers for purposes of fuel economy standards is done pursuant to an explicit statutory provision.

You state that the Alliance "understands the above observation reaffirms that vehicles of related manufacturers are not ordinarily required to be grouped together by the Safety Act, unlike the contrasting situation for fuel economy." You state further, however, that because of the potential for the first sentence of the quoted paragraph to be misunderstood, particularly if it is taken out of context, the Alliance "seeks confirmation that a group of related vehicle manufacturers may continue to choose, if they so desire, to combine fleets for safety standard phase-in purposes."

In considering your letter, we note that, in interpreting the provision at issue, we have not taken the position that we would consider a particular vehicle to have been manufactured by two or more manufacturers solely based on the corporate relationships between those manufacturers.

We considered this issue to some degree in a September 18, 1987, interpretation to General Motors (GM), addressing whether it could be deemed the manufacturer of passenger cars produced by Lotus for purposes of the phase-in of the automatic occupant protection requirements.

In our interpretation, we noted that in the April 1985 NPRM proposing phase-in requirements for Standard No. 208, we had stated that we consider the statutory definition of "manufacturer" to be sufficiently broad to include "sponsors," depending on the circumstances. We stated in the NPRM that if a sponsor contracts for another manufacturer to produce a design exclusively for the sponsor, the sponsor may be considered the manufacturer of those vehicles, applying basic principles of agency law.

We presented the following analysis to support our conclusion that GM could be considered the manufacturer of Lotus passenger cars:

Both LCL, the actual assembler, and LPC, the actual importer, are wholly-owned subsidiaries of GM. By itself, GM's ownership of both the producer and importer of these cars might not be sufficient to establish that GM was the sponsor of these vehicles for the purposes of Standard No. 208. In addition, however, another GM wholly-owned subsidiary distributes and markets the vehicles in the United States. GM coordinates the activities of all these subsidiaries. Since GM wholly owns the actual producer of these vehicles and is actively involved in the importation, distribution, and marketing of these vehicles, we believe that GM should be considered to sponsor the importation of the Lotus vehicles. Accordingly, GM rather than LPC, may be considered the importer and manufacturer of these vehicles.

Thus, in considering whether GM could be considered a manufacturer of Lotus passenger cars, we looked to GM's overall involvement with those vehicles and not merely to the fact that it owned the producer and importer of those vehicles.

In now considering the Alliance's request for interpretation, we believe several factors are relevant.

First, we believe that the application of the manufacturer attribution provisions applicable to phase-in requirements needs to be clear, without the necessity of addressing each specific situation by interpretation.

Second, we believe that, as a practical matter, there is typically sufficient interaction among related manufacturers, and direct involvement by a "parent manufacturer" in the actions of its subsidiaries, that their fleets can reasonably be considered as a single fleet for purposes of complying with phase-in requirements.

Third, from a public policy perspective, there is little (if any) difference in the number of compliant vehicles introduced into the fleet during the phase-in years between the case in which commonly owned manufacturers are permitted to combine their fleets and the case in which commonly owned manufacturers are permitted to separate their fleets for compliance purposes.

Fourth, as a general matter, NHTSA does not have any interest under the Safety Act as to how companies choose to structure themselves, so long as Safety Act obligations are fully met. Thus, in a situation in which one manufacturer corporation buys another, NHTSA does not generally have any interest in whether the corporation that has been purchased becomes a division of the other manufacturer or is maintained as a subsidiary.

Given the above considerations, we have concluded that vehicle manufacturers may combine the fleets of motor vehicle manufacturing subsidiaries they own for purposes of determining overall fleet compliance with the compliance percentages set forth in the various safety standard phase-in requirements, subject to the agreement of those other manufacturers. Moreover, recognizing the different levels of ownership that exist in the industry and wishing to avoid further requests for interpretation in this area, we take the following further position: For purposes of complying with phase-in requirements under Federal motor vehicle safety standards, vehicle manufacturers may combine, with their fleet, the fleets of motor vehicle manufacturers that are considered to be within the same "control" relationship for purposes of the CAFE standards (and which are in fact included in the same fleets under the CAFE statute), subject to the agreement of the other manufacturers. To the extent that the fleets of more than one manufacturer are so combined, we would consider each manufacturer jointly and severally liable for any failure to meet a relevant percentage phase-in requirement.

Since this interpretation is based on specific factual determinations and policy concerns related to phase-ins of new safety requirements, it should not be considered as precedent for how we would interpret the term "manufacturer" in other contexts.

I also note that this interpretation does not overturn the one we sent to Mr. Nakayama. In that interpretation, we addressed the status of certain small volume manufacturers in the context of ownership relationships with other manufacturers. Our conclusion that the small volume manufacturers at issue qualified for the special small volume implementation schedule reflected a number of considerations, including the operational independence of the companies.

Sincerely,

Jacqueline Glassman
Chief Counsel

ref: 208
d.10/24/02

ID: alliance.march20

Robert Strassburger, Vice President
Safety and Harmonization
Alliance of Automobile Manufacturers
1401 H Street, NW, Suite 900
Washington, DC 20005

Dear Mr. Strassburger:

This is in response to your letter of March 18, 2003, in which you asked questions regarding our interpretation of certain provisions of the early warning reporting rules promulgated by the National Highway Traffic Safety Administration, Subpart C of 49 CFR Part 579. You requested prompt turn around in view of the fact that the first reporting period will soon begin. This letter provides that response. I will first paraphrase your inquiries and then provide a brief statement of our interpretation.

1. Reporting Information on the Face of a Claim/Complaint. The Alliance inquired as to whether manufacturers must report complaints/claims based on the information contained on the face of the complaint or claim, rather than reporting on the basis of the manufacturers review or analysis of the complaint/claim.

The answer is yes. Reporting is to be based on the information in the complaint or claim, rather than on the manufacturers assessment. Even if the manufacturer disagrees with the assertions of the consumer/claimant after conducting its analysis, the manufacturer must still report the complaint or claim. Each of the five examples given in your letter would be reportable as a "consumer complaint" under the early warning reporting rules.

2. Marketing Survey Information. The Alliance sought NHTSAs concurrence that marketing information purchased from third-party vendors (such as J.D. Power) or supplied by third parties (such as Consumer Reports magazine), which might contain information reflecting a consumers dissatisfaction with a product, is not reportable in the early warning program as a "consumer complaint," or otherwise, even if the information contains "minimum specificity" about the make, model, and model year of a vehicle. You also asked about complaints that are included in "marketing information" solicited by a manufacturer directly from the purchasers of its products.

We concur with respect to third-party submissions, since they are not "addressed to the company . . . ." and therefore do not fall within the regulatory definition of "consumer complaint" in Section 579.4(c). However, if a manufacturer collects the information directly from its consumers, by itself or through a contractor, it would have to report any "complaints" included in that information, regardless of whether the primary purpose of the activity is marketing. As you note in your letter, consumers responding to such manufacturer surveys are "likely aware that they are communicating with the manufacturer." The fact that the comments are solicited by the manufacturer is not determinative, particularly since many consumers who make a complaint about a vehicle in this context will justifiably believe that they need not repeat that complaint to a different office within the company.

3.Dealer Repair Work Orders. The Alliance sought the agencys views on whether dealer repair work orders, if received in writing by a vehicle manufacturer, are reportable as " dealer field reports." These work orders are the dealers internal records of service performed at dealerships. As described in your letter, these work orders are not requested by, or provided to, manufacturers in the ordinary course of business, but might be submitted in the context of "lemon law" proceedings, product liability litigation, or similar proceedings, often many years after the service in question was performed. As such, we would not consider them to be "field reports" under the rule, and they would not have to be reported under that category. However, if the work had been performed under warranty, it would have to be reported as a warranty claim.

4.Vehicle Inspections Conducted to Determine Eligibility for Insurance and/or Extended Warranty Coverage. Finally, the Alliance asked whether written reports of vehicle inspections conducted solely to determine eligibility for insurance and/or extended warranty coverage are reportable as "field reports." As described in your letter, these reports are not prepared in response to an assertion that a specific problem exists in a particular vehicle, which is the normal genesis of field reports. Thus, although it is possible that an inspection report might identify a problem in a vehicle, it would not be a "communication . . . regarding the failure, malfunction, lack of durability, or other performance problem . . . ." As such, these inspection reports would not have to be reported to us as field reports.

If you have any questions, pleas call Taylor Vinson or Lloyd Guerci of this office at (202) 366-5263.

Sincerely,

Jacqueline Glassman
Chief Counsel

ref:579
d.33/25/03

ID: alliance.ztv

Mr. Robert S. Strassburger
Vice President
Vehicle Safety and Harmonization
Alliance of Automobile Manufacturers, Inc.
1401 H Street, NW, Suite 900
Washington, D.C. 20005

Dear Mr. Strassburger:

This is in reply to your letter of January 13, 2003, asking two questions with respect to the final rules set forth in 49 CFR Part 579.

Your first question cited a portion of the early warning reporting final rule, Section 579.21(b), which applies to "all light vehicles less than ten calendar years old at the beginning of the reporting period." Under subsection (b)(1), a manufacturer must report "each incident involving one or more deaths occurring in a foreign country . . . involving a manufacturers vehicle, if that vehicle is identical or substantially similar to a vehicle that the manufacturer has offered for sale in the United States." You asked that we concur in your understanding that the ten-year old limitation "applies both to the age of the vehicle in which the fatality occurred in a foreign country and to the offering for sale of a substantially similar vehicle in the United States." You presented a situation in which a fatality occurs in a vehicle that is substantially similar to a vehicle previously offered for sale in the United States but whose sale was discontinued more than ten years before the beginning of the reporting period. In this event, the Alliance understands that the "ten calendar year" limitation applies and that a manufacturer would not have to report the incident.

You are correct that the purpose of the regulation is to identify potential defects in vehicles in the United States. Although safety defects can and have existed in vehicles older than ten calendar years, the early warning reporting requirements are intended to be consistent with the amendment to 49 U.S.C. 30120(g) under which the period for remedy of defective and noncompliant motor vehicles without charge was increased from eight to ten years. Therefore, we confirm your understanding that a claim involving a fatality or injury occurring in a foreign vehicle need not be reported if no sales of a substantially similar vehicle have occurred in the United States for more than ten years before the beginning of the reporting period. On the other hand, in a situation in which a fatality or injury occurs in a foreign vehicle that is more than ten years old and a substantially similar U.S. vehicle has been sold within a ten-year period before the reporting period, a related claim must be reported to us. This interpretation applies not only in the context of Section 579.21(b), but also with respect to the ten-calendar-year language of Sections 579.22(b), 579.23(b), and 579.24(b), and the five-calendar-year provisions of Section 579.25(b) and 579.26.

Your second question arises in the context of the foreign defect reporting final rule. Section 579.11(d)(2) (as originally adopted) provided that a manufacturer need not report a foreign safety recall or other campaign to NHTSA if "the component or system that gave rise to the foreign recall does not perform the same function in any vehicles or equipment sold or offered for sale in the United States." It is your understanding that "no report would be required when a foreign campaign is conducted on a vehicle that is substantially similar to one offered for sale in the United States, but the component or system that gave rise to the foreign recall is not installed on the U.S. vehicles."

In response to the Alliances petition for reconsideration of the foreign defect reporting final rule, we amended Section 579.11(d)(2) to state that a manufacturer need not report if "the component or system that gave rise to the foreign recall or other campaign does not perform the same function in any substantially similar vehicles or equipment sold or offered for sale in the United States." 68 FR 4111, January 28, 2003. Since we have clarified that we do not require reporting if a component or system is present on a substantially similar U.S. vehicle but does not perform the same function as on a foreign vehicle, we believe that it is also clear that a manufacturer need not report to us if the system or component leading to the foreign recall or other campaign is not installed at all on the substantially similar U.S. vehicle.

If you have any questions, you may call Taylor Vinson of this Office (202-366-5263).

Sincerely,

Jacqueline Glassman
Chief Counsel

ref:579
d.4/11/03

ID: alliancerecords.ztv

Mr. Robert Strassburger
Vice President, Safety and Harmonization
Alliance of Automobile Manufacturers
1401 H Street, N.W.
Suite 900
Washington, DC 20005

Dear Mr. Strassburger:

This is in reply to your letter of August 13, 2003, asking for an interpretation of the early warning reporting (EWR) rule, 49 CFR Part 579, Subpart C, with respect to the updating of certain information under Section 579.28(f).

You pointed out that under a NHTSA recordkeeping regulation, 49 CFR 576.5(b), manufacturers must retain, for five years, all the "underlying records" that form the basis for EWR information submitted under Part 579. You asked us to confirm your understanding that "manufacturers must update previously submitted information on fatalities or injuries pursuant to Section 579.28(f) for a period of five years from the quarter in which the fatality or injury was initially submitted to NHTSA." You argued that, in view of the need (explained at a public meeting held on June 19, 2003) to submit updates as part of a resubmission of the entire Excel workbook containing fatality and injury information, "reporting updates beyond that time is inconsistent with the recordkeeping requirement." We confirm your understanding, and note that it is extremely unlikely that a manufacturer would have to update any such reports at such a late date.

If you have any questions, you may call Taylor Vinson or Andrew DiMarsico of this Office (202-366-5263).

Sincerely,

Jacqueline Glassman
Chief Counsel

ref:576#579
d.9/4/03

ID: AmericanSweeperltr

Mr. Ranger Kidwell-Ross
Editor, American Sweeper Magazine
2778 Barrel Springs Road
Bow, WA 98232





Dear Mr. Kidwell-Ross:

This responds to your letter regarding small parking area sweepers.

You describe the process by which certain companies in the sweeper industry remove the beds of small pickup trucks manufactured by Dodge, Toyota, GM, Ford, and other manufacturers and mount, in their place, sweeper machinery. You ask whether any of this agency's safety requirements apply to such altered or modified vehicles. The answer is yes, but the particular requirements that apply depend on whether the company adding the sweeper machinery is considered an alterer of a vehicle prior to its first sale or a modifier of a used vehicle.

By way of background information, pursuant to the National Traffic and Motor Vehicle Safety Act, as amended, 49 U.S.C. 30101 et seq. (Safety Act), the National Highway Traffic Safety Administration (NHTSA) has the authority to issue Federal motor vehicle safety standards (FMVSS) for new motor vehicles and new items of motor vehicle equipment. Under the Safety Act, manufacturers of vehicles and equipment have the duty to ensure that their vehicles and equipment meet all applicable standards and to certify them accordingly.

You indicate that the vehicles on which the sweeper machinery is being mounted are "completed vehicles." We assume, therefore, that prior to the sweeper machinery being mounted, these vehicles have been certified by their manufacturers as complying with all applicable FMVSS. You further indicate that the sweeper machinery is mounted to the vehicles either prior to being sold to consumers or after the vehicles are sold to consumers.

In the case of the vehicles upon which sweeper machinery is mounted prior to the first purchase in good faith of the vehicles for purposes other than resale, those companies would be considered "alterers." Persons are considered alterers if (1) they alter the vehicle in any manner "other than by the addition, substitution, or removal of readily attachable components . . . or minor finishing operations," or (2) they alter "the vehicle in such a manner that its stated weight ratings are no longer valid." 49 CFR 567.7. Since the conditions you describe involve the addition of equipment that is not readily attachable, the companies adding the sweeper machinery would be considered alterers.

As alterers, the companies would be subject to the certification requirements of 49 CFR 567.7. These requirements include provisions that the alterer supplement the existing manufacturer certification label, which must remain on the vehicle, by affixing an additional label. The label must state that the vehicle as altered conforms to all applicable Federal motor vehicle safety standards. The label must also identify the alterer and the month and the year in which the alterations were completed.

In the case of the vehicles upon which sweeper machinery is mounted after the first purchase in good faith of the vehicles for purposes other than resale, those companies would be considered modifiers of used vehicles. Unlike alterers, modifiers of used vehicles are not required to affix a label stating that the vehicle, as modified, continues to conform to all applicable FMVSS. The only provision in Federal law that affects the vehicle's continuing compliance with applicable safety standards is set forth at 49 U.S.C. 30122, which states, in part, that a "manufacturer, distributor, dealer, or motor vehicle repair business may not knowingly make inoperative . . . any part of a device or element of design installed on or in a motor vehicle or motor vehicle equipment in compliance with an applicable motor vehicle safety standard." Any person who will accept compensation to repair a vehicle is a motor vehicle repair business.

In general, this "make inoperative" provision would require any of these named entities to ensure that any additional equipment installed in a vehicle would not negatively affect the compliance of any component or design on the vehicle with applicable safety standards. Violations of 49 U.S.C. 30122 are punishable by civil penalties up to $5,000 per violation. The prohibition of Section 30122 does not apply to individual owners who install equipment in their own vehicles, but does apply to any person paid to do so. While it may not be a violation of law for individual owners to install themselves any item of motor vehicle equipment regardless of its effect on compliance with Federal motor vehicle safety standards, NHTSA encourages consumers not to degrade the safety of their vehicles or equipment.

Finally, you inquired as to the effect that the alteration or modification of these vehicles might have on the warranties supplied by the original vehicle manufacturers. Vehicle warranties do not fall within the purview of NHTSA; you may wish to contact the Federal Trade Commission, whose jurisdiction does include new vehicle warranties. You may also wish to contact individual States to determine whether there are any State requirements applicable to the alteration, modification, and warranty concerns you raised.

If you have any additional questions or would like to discuss this matter further, you may contact Robert Knop of this Office at (202) 366-2992.

Sincerely,

Jacqueline Glassman
Chief Counsel

ref:567
d.4/2/02

ID: amphibious_vehicle6175

Mr. Paul Larkin
Compliance and Research Services, Inc.
1701 West Front Street
Plainfield, NJ 07063




Dear Mr. Larkin:

This is in response to your letter, in which you asked if an amphibious vehicle your client is seeking to import would be classified as a "motor vehicle."  As explained below, our answer is yes.

Title 49 U.S. Code 30112 prohibits the importation of any motor vehicle or motor vehicle equipment that is not certified to all applicable Federal motor vehicle safety standards."Motor vehicle" is defined at 49 U.S.C. 30102(a)(6) as:

[A] vehicle driven or drawn by mechanical power and manufactured primarily for use on the public streets, roads, and highways, but does not include a vehicle operated only on a rail line.

Vehicles equipped with tracks, agricultural equipment, and other vehicles incapable of highway travel are not motor vehicles.Certain vehicles designed and sold solely for off-road use (e.g., airport runway vehicles and underground mining vehicles) are not motor vehicles, even if they may be operationally capable of highway travel.

In your letter you stated that your client, Rodedawg International Industries, wishes to import for sale into the U.S. an amphibious vehicle.You stated that the vehicle, the Rodedawg, is designed for "off-road use only, and will be sold, advertised, and marketed as such.You also stated that the certificate of origin will include a statement noting that the vehicle is not designed for use on public roads.You listed various vehicle characteristics demonstrating the vehicles amphibious capabilities and further stated that it is equipped with a throttle stop that limits the maximum speed on roads to 25 miles per hour.

The agency has consistently stated that off-road capabilities alone do not remove a vehicle from the definition of a "motor vehicle" (See letter to Judith Jurin Semo, April 19, 1994).While relevant, vehicle distribution and declarations contained in the certificate of origin are not determinative.The statutory definition directs us to consider the vehicle as manufactured.

Aside from the amphibious nature of the vehicle, the Rodedawg as manufactured is not readily distinguishable from other motor vehicles that have off-road capabilities, e.g., sport utility vehicles.Sport utility vehicles are considered motor vehicles and are generally classified as multipurpose passenger vehicles under our regulations.

We also note that the manufacturers website advertises the Rodedawg as a sport utility vehicle (http://rodedawgsuv.com/index.html, visited July 23, 2005) and represents the vehicle as an automobile.

Based on the design of the vehicle the Rodedawg would be classified as a "motor vehicle". If you have any further questions, please contact Mr. Chris Calamita of my office at (202) 366-2992.

Sincerely,

Stephen P. Wood
Acting Chief Counsel

ref:571
d.1/24/06

ID: Anuvu_002304

Mr. Ed Ring
Director Strategic Planning
Anuvu Incorporated
3980 Research Drive
Sacramento, CA 95838

Dear Mr. Ring:

This responds to your e-mail inquiry and telephone discussion with Mr. Chris Calamita of my staff, regarding Federal requirements that could affect the plans of your company (Anuvu) to install fuel cell/electric hybrid systems (fuel cell systems) in new, fully-certified motor vehicles, and then to sell those altered vehicles to consumers.

You stated that installation of the fuel cell system would necessitate the removal of the vehicles engine, transmission, and fuel tank. You explained that your company would then install a fuel cell stack, electric motor, hydrogen storage tank, and battery pack. You further explained that the alteration would include installing a regenerative braking system, which would be attached to the drive train, and an electric motor that would be used to power the hydraulic brake system. You noted that no other alterations would be made to the brake system.

Motor Vehicle Certification

A manufacturer of motor vehicles must certify that its vehicles comply with all applicable Federal motor vehicle safety standards (FMVSS) (49 U.S.C. 30115, Certification of compliance). If any person alters a certified motor vehicle, prior to its first sale for purposes other than resale, then that person is deemed an "alterer," a type of manufacturer. As an alterer, that person must certify that the vehicle, as altered, continues to comply with all of the safety standards affected by the alteration. See 49 CFR Part 567, Certification (enclosed).

Since Anuvu plans to install the fuel cell systems in new vehicles, i.e., ones that have not yet been sold for purposes other than resale, Anuvu would be an alterer. As such, Avunu would be required to certify that the altered vehicles continue to comply with the Federal safety standards affected by the addition of the fuel cell system. The certification requirements for alterers can be found in 567.7. Additionally, at the point of first retail sale, the vehicle must comply with all standards applicable to the vehicle as altered (49 U.S.C. 30112(a)) and be certified as such.

Further, 49 U.S.C. 30122 prohibits manufacturers, distributors, dealers, or motor vehicle repair businesses from knowingly making inoperative any part of a device or element of design installed on or in a new or used motor vehicle in compliance with an applicable FMVSS. Although Anuvu intends to remove fuel systems certified as complying with FMVSS No. 301, it is likely that this "make inoperative" provision would not be violated with respect to that standard.

This is because FMVSS No. 301 applies to vehicles that are equipped with fuel systems that use a fuel with a boiling point above zero degrees Celsius. The standard does not require vehicles to be equipped with such a fuel system. The vehicles as altered by Anuvu would be equipped with fuel systems that rely on hydrogen, a fuel with a boiling point below zero degrees Celsius. Since FMVSS No. 301 would not apply to the vehicles as altered, the make inoperative provision would not be violated by the removal of the FMVSS No. 301 fuel system. However, the make inoperative provision would prohibit Anuvu from rendering inoperative any device or element of design installed in compliance with any FMVSS that applied to the vehicle as altered, and subsequent to alteration (i.e., technology upgrades, retrofits).

Applicable FMVSSs

In order to determine how the installation of your fuel cell system would affect vehicle compliance with applicable Federal safety standards, you should carefully review each standard in 49 CFR Part 571. However, there are certain standards (discussed below) of which you should be particularly aware.

First, I would draw your attention to FMVSS No. 305, Electric-powered vehicles: electrolyte spillage and electric shock protection. This standard would apply to your vehicle if it used more than 48 nominal volts of electricity as propulsion power, had an attainable speed in 1.6 km on a paved level surface of more than 40 km/h, and had a gross vehicle weight rating of 4536 kilograms or less. FMVSS No. 305 specifies the requirements for limitation of electrolyte spillage, retention of propulsion batteries during a crash, and electrical isolation of the chassis from the high-voltage system.

Section 3 of FMVSS No. 135, Passenger car brake system, defines "electric vehicle" as a motor vehicle that is powered by an electric motor drawing current from rechargeable batteries or a fuel cell. Therefore, the addition of the fuel cell system would also change your vehicles classification to an electric vehicle for the purposes of FMVSS No. 135. Accordingly, if FMVSS No. 135 continued to apply to your vehicle, the vehicle would be required to comply with the brake performance requirements applicable to electric vehicles.

Although there is not currently any FMVSS applicable to hydrogen fuel systems or hydrogen fuel tanks, any application of fuel cell technologies to motor vehicles should include reasonable precautions to ensure the safety of the motoring public. In the absence of Federal regulations, Anuvu should consult voluntary standards and recommended practices developed by groups such as the Society of Automotive Engineers, American National Standards Institute, and International Standards Organization.

I note that in your correspondence with Mr. Calamita, you discussed ways in which you have considered the safety of the converted vehicles. I strongly encourage you to ensure that your company takes appropriate and sufficient precautions concerning your companys current and projected applications of fuel cell technologies, and that your company will follow, and where necessary establish, appropriate internal evaluation and design protocols to address every potential safety concern.

Additionally as an alterer, your company would be subject to the requirements of Chapter 301 concerning the recall and remedy of safety related defects. If our agency or Anuvu were to determine that an altered vehicle contained a safety-related defect, Anuvu would be responsible for notifying purchasers of the defect and remedying the problem free of charge (49 U.S.C. 30118-30121).

Exemption from an FMVSS

In your telephone conversation with Mr. Calamita, you inquired into the possibility of applying for an exemption from the FMVSSs impacted by the alteration. 49 CFR Part 555, Temporary Exemption from Motor Vehicle Safety and Bumper Standards, establishes requirements for the temporary exemption of certain motor vehicles from compliance with one or more FMVSS in accordance with 49 U.S.C. 30113. Under 555.6(c), a manufacturer may ask for an exemption of up to two years, for a maximum of 2,500 vehicles per year, on the basis that an exemption would make the development of a low-emission vehicle easier and would not unreasonably lower the safety of the vehicle. See 49 CFR Part 555 (enclosed) for the information required to demonstrate that safety would not be unreasonably degraded and the specifications regarding application for an exemption.

Please note that Part 555 requires the agency to publish a notice in the Federal Register seeking public comment on each exemption petition before a decision can be made on such a request, and then publish a second notice either granting or denying the petition. This process normally takes three to four months from the date of submittal.

If you have further questions, please feel free to contact Mr. Calamita at (202) 366-2992.

Sincerely,

Jacqueline Glassman
Chief Counsel

Enclosures
ref:567
d.5/20/04