Center for Automotive Research Management Briefing Seminars

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Thank you, John. Thank you to the Center for Automotive Research for having me and congratulations on the 60th anniversary of the Management Briefing Seminars. From enabling personal mobility to providing a critical economic backbone for our country, the automotive industry plays such an incredibly important role in our society. And throughout most of the industry’s history, the Center for Automotive Research has provided robust and timely analysis to support companies and policymakers. The Management Briefing Seminars have been critical in bringing automotive executives and researchers together to listen and discuss trends and events that shape all of our lives, and I hope it continues to take place for many years to come. So, thank you again. It’s great to be here today and it’s great to be back serving the American people. 

I want to talk a bit about our vision at NHTSA, but before I do, I’m going to make some news. At NHTSA, our first priority is to make our roadways safer and to save lives, so I’m pleased to announce NHTSA’s early-estimate roadway fatality numbers for the first half of 2025, which we’re releasing today. The numbers are encouraging. In the first six months of the year, we saw a substantial 8.2% decline in roadway deaths compared to the same period last year. That’s more than 1,500 fewer deaths, year over year. In addition, the fatality rate per 100 million vehicle miles traveled dropped to 1.06, down from 1.16 in the same period last year.  This represents the lowest mid-year fatality rate since 2014. 

So, we’re gratified to see this progress after the shocking spike in traffic fatalities that started during the pandemic.  And while we’re heartened by these numbers, we know we have a lot of work still to do to address the ongoing traffic safety crisis. Under this Administration, we’ve initiated several new initiatives to reduce risky driving behaviors, and we’re acting with a sense of urgency. First and foremost, from day one we immediately reversed several years of an unfortunate policy of disengagement with law enforcement. 

Traffic law enforcement is the single most effective method of curbing dangerous driving activities.  It is our law enforcement officers that put their lives on the line to keep our roads safe. The President, Secretary Duffy, and I want to send the crystal-clear message that we support law enforcement, we honor their bravery and sacrifice, and we want to see them continue coming back out in larger numbers doing traffic enforcement. We’re meeting with their organizations and leadership, speaking at their conferences, and renewing contracts and cooperative agreements that had lapsed or been cut. We know we can’t fulfill our mission to save more lives without them, and we want them to hear it.   

We’re also focusing on using data and advanced analytics in new ways—including artificial intelligence, to support state highway safety offices to identify their specific traffic safety problems more precisely, whether it be excessive speed or impaired, unbelted, or distracted driving. We’re working to quickly provide States with customized guidance on targeted areas with best-practice tool kits and resources so they can better focus enforcement, messaging, and road construction resources. We think this approach will continue to improve and pay dividends in the years ahead. 

Lastly, we’ve increased efforts to save more lives after crashes occur.  42% of individuals who are killed as a result of vehicle crashes are alive when first responders arrive at the scene.  Research shows that prehospital blood transfusion decreases mortality among trauma patients with severe bleeding by 37%. So, we’re partnering with the Department of Defense to invest $30 million in establishing prehospital blood transfusion demonstration programs throughout the country. By providing first responders with equipment, training, and blood products, we believe that their post-crash care can be more effective and will save lives. This partnership will launch the largest federally sponsored prehospital blood transfusion project ever undertaken. We aim to create at least 25 new prehospital blood transfusion programs throughout the country in the next three years. In coming months, we look forward to sharing more about these initiatives and areas of focused effort. 

Two of Secretary Duffy’s focus areas are right in NHTSA’s wheelhouse, so I want to provide a brief update. The Secretary asked NHTSA to evaluate the fuel economy standards that had been issued under the previous administration for consistency with law.  NHTSA subsequently issued an interpretive rule clarifying legal constraints imposed by the underlying statutory authority. Most recently, NHTSA submitted a draft notice of proposed rulemaking to the White House, commencing interagency review.  Once published, we look forward to hearing from you all. Second, the Secretary announced efforts to establish an AV Framework to allow for the safe testing and deployment of Automated Driving Systems.  This has already led to cutting red take and removing disadvantages for domestic ADS developers. In the recently released White House Agenda of Regulatory and Deregulatory Actions, NHTSA announced the commencement of several additional rulemakings in the area.  And there is much more to come.

Vehicle Safety Regulation 

So, with that, let me turn to the main topic for today, which is perhaps a thematic vision of this Administration’s approach to automotive regulation. For those of you who don’t know me, I’ve spent my career working on automotive law and policy issues, ranging from consumer protection, to finance, to safety, to franchise, to where we stand today: the intersection between policy and regulation and technological innovation.  I may be a bit naive, but I believe that laws and regulations almost always come from a genuinely noble space: policymakers are attempting to solve what they believe to be problems in society. Now folks can disagree as to the extent of individual problems, the effectiveness of proscribed solutions, or on whose behalf those solutions are targeted, but I believe that premise to be fundamentally true. I also believe that innovation can provide continually more effective solutions to the problems of society (but of course, innovation can create new societal problems or exacerbate existing ones). What I’d like to focus on today is that sensitive dynamic between AUTOMOTIVE regulation and innovation. And I think it’s absolutely critical to examine that dynamic as the American auto industry is facing some of the greatest challenges in its history. 

I tend to believe that the United States’s system of automotive safety regulation is the best in the world, as it is intended to encourage innovation.   The Vehicle Safety Act requires NHTSA to establish Federal Motor Vehicle Safety Standards in the form of performance requirements meeting the need for motor vehicle safety, and to do so in a way that is objective and practicable—taking into account affordability, technological readiness, consumer acceptance, and laid out with formal and specific testing criteria such that a manufacturer has the ability to determine, with certainty, whether their vehicle or equipment will pass or fail. Manufacturers must certify that their vehicles comply with the standards, and NHTSA acquires vehicles in the market to determine whether they do so. These standards exist in the context of a system that also contemplates very broad authorities relating to vehicles or equipment having a defect creating an unreasonable risk to safety—regardless as to whether that safety risk has anything to do with a Federal Motor Vehicle Safety Standard.  And the remedy for a defect or non-compliance is the same: a recall. 

Underpinning this system is the notion that automakers are free, even encouraged, to innovate. Unlike most countries where new technologies cannot be deployed unless and until they are regulated—regardless of any real potential safety risk, the United States system provides the freedom to develop and deploy technologies unless they are UNSAFE. And while I truly believe the framework of the Vehicle Safety Act is elegant and effective, I can’t say that its implementation always has been. Performance standards drafted with the intent of being technology neutral are created with a background understanding of the technologies that existed at the time they were promulgated. 

Decades later, these standards can become riddled with requirements that create unintended and unnecessary barriers to new technologies or designs—often entirely unrelated to the underlying safety goals of the standards. I know automotive trade association and reporter loves to point to the example of FMVSS No. 135’s requirements that vehicle service brakes be operated by means of a foot control as blocking new designs enabled by the possibility of automated driving systems. And, of course, when light duty braking standards were developed this pedal control requirement was meant to address human factors concerns, with no thought of automated driving systems. And it’s certainly true that this standard would need to be amended to allow for the deployment of light duty vehicles without manual controls. But this issue is far more endemic than this. 

For instance, FMVSS No. 108 contains several provisions such that lighting must meet performance requirements by applying 12.8 volts direct current to the terminals. While this was no doubt drafted to provide appropriate specificity to testing inputs, it has the effect of boxing out alternative technologies—and limiting design creativity.  If somebody were to consider implementing a 48 volt architecture, for instance, they’d need to install a DC/DC step down converter, taking up space, and adding mass, cost, and complexity, with no corresponding benefits.  You don’t improve safety by regulating the thickness of a wiring harness.  I consider these VESTIGIAL regulations—similar to vestigial organs we learned about in anatomy classes, such as the appendix or wisdom teeth, that no longer serve any real functions, but can create real harm. And these vestigial regulations have a tendency to ossify, and effect industry in unforeseen ways. They can have a cascading effect over time.  They become baked into the underlying notion of what it means to design a vehicle——another box to check. And every time that box is checked, we’ve lost another opportunity to innovate or design new ways to meet and exceed safety requirements more efficiently and effectively if a manufacturer so chooses. 

Now rulemaking in the United States is very difficult: in the US system, regulations require a great deal of research.  Unless the type of research to underpin a regulation is already completed and public, and it almost never is, NHTSA must sponsor the research. This requires paperwork reduction act clearances that take at least several months before we can even commence the procurement process that leads an award that enables the start of research.  Once the research is complete and the agency has the facts that enable drafting and proposing a regulation, the process requires notice and comment on the proposal, and those comments often trigger additional changes to get the final result right and avoid unintended consequences.  I believe it takes, on average, about seven years to establish a new Federal Motor Vehicle Safety Standard. 

That can be much simpler, however, if we’re eliminating non-controversial vestigial regulations with no safety benefit, and can prove that fact. But if I had a magic wand that could make it all happen, and the ability to fast forward and look back upon this administration’s regulatory accomplishments, it would be this: that we moved the safety ball forward, met statutory rulemaking requirements, and eliminated both barriers to new technologies and inefficiencies that increase cost and complexity without corresponding safety benefit. That we enabled automakers to design and produce safe vehicles that they believe their customers will want and need, at a more affordable price. But in that world, the “check the box because a regulation effectively requires it” crutch would be eliminated. You’d need to make consequential design decisions on how you achieve your safety performance requirements. Now, that’s nothing new in the automotive industry, but would take place at a much more detailed level within your design. Deciding whether to keep doing things the same way, or to exercise the greater flexibility afforded by the elimination of vestigial regulations. 

In that world, your designers would have much more design freedom, and your safety engineers would have new opportunities to enhance safety. That means more design iterations and more engagement between the two groups.  As always, when there’s disagreement between the two, compromise isn’t possible, and they’re in need for more direction, executives will need to make the hard decisions on which direction to go. I may be biased speaking for NHTSA, but if you don’t like what one group has to say, I recommend you listen more to your safety engineers. In this idealized world, our regulatory structure and text would give you more opportunity to innovate.  It would give you more opportunity to succeed if you make the right choices.  It would give you more opportunity for failure. And perhaps it is this opportunity for failure that is the most important part: as you make these decisions, your competitors will be making similar ones and you SHOULD be driven in part by the possibility that they will make better, more efficient, and more effective ones. I would love to see the system enable unharnessed competition within the United States automotive space—meeting and exceeding safety standards on the way to delivering the best vehicles the world has ever produced as opposed to a system that tells you what to do and how to do it.  We don’t want automakers or suppliers to succeed merely because they can best satisfy a vestigial regulation that creates no benefit to society and alienates their customer base. 

So how do we get there? We as the government need to be a bit less inward facing, and a bit more outward facing. We need to engage more with the industry and safety experts to identify the vestigial regulations that the agency can and should address.  And I don’t mean you sending your DC lobbyists and lawyers to meet.  I’m hoping for technical engagement on a number of fronts. But this requires a bit of a cultural change both from industry and the government, and a lot of trust—just as regulatory requirements can ossify, so can broken working relationships, recriminations, and assumptions of ulterior motivations. I’d like to attempt to break this cycle. And this goes well beyond rulemaking. 

As you know more than anybody, automotive technology is changing at an incredibly rapid pace.  Not just with automation and electrification, but also with electronics, with zonal architectures, with software designed vehicles.  These technologies offer great potential benefits for safety, efficiency, and consumer satisfaction, but also great potential risks.  I want NHTSA to engage deeply with your technical teams to understand how you are moving, and what safety concerns YOU have.  I understand that’s tough—we are your regulator and I take enforcement very seriously as you may recall from my time as Chief Counsel. I want you to help us see around corners and get ahead of problems.  It’s in nobody’s interests for unexpected safety risks to be made manifest on the roads. 

I do want to recognize the intense challenges the industry is facing. Developing and supporting fundamentally new and extraordinarily capital intensive technological and powertrain development for disparate domestic and international markets, being pulled in different directions for policy, political, and trade purposes.  Sunk cost risks are greater than ever. Meanwhile, investors and lenders are increasingly focused on providing capital to AI developers, making capital even more expensive, all while your consumers are increasingly being priced out of the new vehicle market and less able to underwrite your investment.  Simultaneously, foreign competitors are cutting critical development steps to go to market in months instead of years and have production capacity that exceeds demand measured in tens of millions of vehicles annually. And while you’re not competing with them here, you are competing with them in other markets around the world. I don’t know that we at NHTSA can solve many of these challenges, but we’re open to your ideas. 

So, in closing I say again that at NHTSA our first priority is on making our roads safer and saving lives. We look forward to continuous improvements in vehicle and traffic safety We believe we can maintain and enhance safety while also freeing OEMs to innovate, try new approaches, and adopt new technologies faster. This is vital to our nation, our economy, and our future. We look forward to working together to usher in, as Secretary Duffy likes to say, a Golden Age of Transportation. 

Thank you. I look forward to working with you all.