Guide Concerning Fuel Economy Advertising for New Automobiles, 19148-19154 [E9-9649]

Agencies

• FEDERAL TRADE COMMISSION

[Federal Register Volume 74, Number 80 (Tuesday, April 28, 2009)]
[Proposed Rules]
[Pages 19148-19154]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E9-9649]


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FEDERAL TRADE COMMISSION

16 CFR Part 259


Guide Concerning Fuel Economy Advertising for New Automobiles

AGENCY: Federal Trade Commission.

ACTION: Proposed rule.

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SUMMARY: The Federal Trade Commission (``FTC'' or ``Commission'') is 
seeking comments on proposed amendments to the FTC's Guide Concerning 
Fuel Economy Advertising for New Automobiles (``Fuel Economy Guide'' or 
``Guide''). The amendments would amend the Guide to reflect changes to 
the Environmental Protection Agency's (``EPA'') fuel economy labeling 
rules for new automobiles and to take into account developments in 
automobile technology.

DATES: Written comments must be received by June 26, 2009.

ADDRESSES: Interested parties are invited to submit written comments 
electronically or in paper form. Comments should refer to ``Fuel 
Economy Guide Review, Matter No. R711008'' to facilitate the 
organization of comments. Please note that your comment--including your 
name and your state--will be placed on the public record of this 
proceeding, including on the publicly accessible FTC Website, at 
(https://www.ftc.gov/os/publiccomments.shtm).
    Because comments will be made public, they should not include any 
sensitive personal information, such as an individual's Social Security 
Number; date of birth; driver's license number or other state 
identification number, or foreign country equivalent; passport number; 
financial account number; or credit or debit card number. Comments also 
should not include any sensitive health information, such as medical 
records or other individually identifiable health information. In 
addition, comments should not include any ``[t]rade secret or any 
commercial or financial information which is obtained from any person 
and which is privileged or confidential. . . .,'' as provided in 
Section 6(f) of the Federal Trade Commission Act (``FTC Act''), 15 
U.S.C. 46(f), and FTC Rule 4.10(a)(2), 16 CFR 4.10(a)(2). Comments 
containing material for which confidential treatment is requested must 
be filed in paper form, must be clearly labeled

[[Page 19149]]

``Confidential,'' and must comply with FTC Rule 4.9(c), 16 CFR 
4.9(c).\1\
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    \1\ The comment must be accompanied by an explicit request for 
confidential treatment, including the factual and legal basis for 
the request, and must identify the specific portions of the comment 
to be withheld from the public record. The request will be granted 
or denied by the Commission's General Counsel, consistent with 
applicable law and the public interest. See FTC Rule 4.9(c), 16 CFR 
4.9(c).
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    Because paper mail addressed to the FTC is subject to delay due to 
heightened security screening, please consider submitting your comments 
in electronic form. Comments filed in electronic form should be 
submitted by using the following weblink: (https://secure.commentworks.com/ftc-fueleconomyguide) (and following the 
instructions on the web-based form). To ensure that the Commission 
considers an electronic comment, you must file it on the web-based form 
at the weblink (https://secure.commentworks.com/ftc-fueleconomyguide). 
If this Notice appears at (https://www.regulations.gov/search/index.jsp), you may also file an electronic comment through that 
website. The Commission will consider all comments that regulations.gov 
forwards to it. You may also visit the FTC Website at https://www.ftc.gov to read the Notice and the news release describing it.
    A comment filed in paper form should include the ``Fuel Economy 
Guide Review, Matter No. R711008'' reference both in the text and on 
the envelope, and should be mailed or delivered to the following 
address: Federal Trade Commission, Office of the Secretary, Room H-135 
(Annex F ), 600 Pennsylvania Avenue, NW, Washington, DC 20580. The FTC 
is requesting that any comment filed in paper form be sent by courier 
or overnight service, if possible, because U.S. postal mail in the 
Washington area and at the Commission is subject to delay due to 
heightened security precautions.
    The FTC Act and other laws the Commission administers permit the 
collection of public comments to consider and use in this proceeding as 
appropriate. The Commission will consider all timely and responsive 
public comments that it receives, whether filed in paper or electronic 
form. Comments received will be available to the public on the FTC 
Website, to the extent practicable, at (https://www.ftc.gov/os/publiccomments.shtm). As a matter of discretion, the Commission makes 
every effort to remove home contact information for individuals from 
the public comments it receives before placing those comments on the 
FTC Website. More information, including routine uses permitted by the 
Privacy Act, may be found in the FTC's privacy policy, at (https://www.ftc.gov/ftc/privacy.shtm).

FOR FURTHER INFORMATION CONTACT: Hampton Newsome, (202) 326-2889, 
Attorney, Division of Enforcement, Bureau of Consumer Protection, 
Federal Trade Commission, 601 New Jersey Avenue, N.W., Washington, DC 
20001.

SUPPLEMENTARY INFORMATION:

I. Background

    The Commission adopted the Fuel Economy Guide in 1975 to prevent 
deceptive fuel economy advertising and to facilitate the use of fuel 
economy information in advertising. The Guide helps advertisers avoid 
making claims that are unfair or deceptive under Section 5 of the FTC 
Act (15 U.S.C. 45(a)).\2\ To accomplish this goal, the Guide contains 
specific information about the disclosure of mileage information 
generated by EPA's well-established fuel economy program. Under EPA 
regulations (40 CFR Part 600), vehicle manufacturers must disclose fuel 
economy numbers on labels attached to new automobiles.\3\ In addition, 
EPA regulations contain specific testing protocols (see 40 CFR Part 86) 
that manufacturers must use to derive the fuel economy information used 
on labels.
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    \2\ The Commission's industry guides, such as the Fuel Economy 
Guide, are administrative interpretations of the application of 
Section 5 of the FTC Act, 15 U.S.C. 45(a). The Commission issues 
industry guides to provide guidance for the public to conform with 
legal requirements. These guides provide the basis for voluntary and 
simultaneous abandonment of unlawful practices by members of 
industry. 16 CFR Part 17. Failure to follow industry guides may 
result in corrective action under Section 5 of the FTC Act. In any 
such enforcement action, the Commission must prove that the act or 
practice at issue is unfair or deceptive.
    \3\ EPA issued its fuel economy labeling regulations pursuant to 
the Energy Policy and Conservation Act of 1975 (49 U.S.C. 32901).
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    To avoid deceptive or unfair claims in advertisements that contain 
fuel economy representations, the Fuel Economy Guide advises marketers 
to disclose established fuel economy estimates (e.g., miles per gallon 
or ``mpg'') as determined by the mandatory EPA testing protocols (``EPA 
tests''). If advertisers make fuel economy claims based on non-EPA 
tests, the Guide directs them to disclose EPA-derived fuel economy 
information and provide details about the non-EPA tests such as the 
source of the test, driving conditions, and vehicle configurations.
    In 1978 and again in 1995, the Commission amended the Guide to make 
it consistent with changes to EPA's regulations. (43 FR 55757 (Nov. 29, 
1978); and 60 FR 56230 (Nov. 8, 1995)). On December 27, 2006 (71 FR 
77872), the EPA published new requirements for fuel economy labeling. 
The revised EPA rules include modifications to the mandatory fuel 
economy test that, among other things, incorporate different driving 
conditions (e.g., cold temperatures) into the determination of fuel 
mileage estimates. The recent EPA amendments also modify the design of 
the fuel economy label and require disclosure of combined (i.e., city 
and highway) fuel economy figures in addition to separate city and 
highway ratings.
    Following EPA's amendments, the Commission published a Federal 
Register notice on May 9, 2007 (72 FR 26328) seeking comment on the 
overall costs, benefits, necessity, and regulatory and economic impact 
of the Guide. The Notice also sought comment on whether the Guide 
should be amended in light of EPA's recent rule changes. The Commission 
has reviewed the comments received, and now is seeking comment on 
proposed amendments to the Guide. This Notice contains an analysis of 
the comments received and a description of the proposed amendments 
(section II), an invitation for comment on those amendments (section 
III), and the proposed language for the amendments (section IV).

II. Analysis of Comments

    The Commission received four comments in response to its May 9, 
2007 notice.\4\ The comments raised a variety of issues about the 
current Guide. Those comments, along with the Commission's responses, 
are detailed as follows:
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    \4\ Alliance of Automobile Manufacturers (529732-
00005); Association of International Automobile Manufacturers, Inc. 
(529732-00008); Broward County Consumer Affairs 
(529732-00001) (529732-00002) (529732-
00003) (529732-00004); and National Automobile Dealers 
Association (529732-00007).
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A. Benefits of and Need for the Guide

    Issue and Comments: In the May 9, 2007 Federal Register notice, the 
Commission asked whether there is a continuing need for the Fuel 
Economy Guide and whether the Guide is necessary to prevent unfair or 
deceptive practices. In response, the comments indicated that the Guide 
provides significant benefits to consumers. According to the Alliance 
of Automobile Manufacturers (``Alliance''), the Guide ``is an important 
industry standard'' that has resulted in informative disclosures to 
consumers that are not overly burdensome to

[[Page 19150]]

manufacturers. The Association of International Automobile 
Manufacturers, Inc. (``AIAM'') described the Guide as ``an important 
industry and consumer resource.'' Similarly, the National Automobile 
Dealers Association (``NADA'') wrote that the Guide ``serves to assure 
prospective new vehicle purchasers that fuel economy claims 
consistently will be advertised in an understandable manner.'' In 
NADA's view, the Guide also helps ``ensure that prospective purchasers 
receive objective, uniform information, and that manufacturers and 
dealers fairly and even-handedly advertise the fuel economy of the new 
vehicles they sell.''
    The Broward County Consumer Affairs Division (``Broward County''), 
a local consumer protection agency in Florida, also supported continued 
publication of the Guide. In its view, manufacturers and dealers would 
engage in unfair or deceptive trade practices routinely if the Guide 
did not exist. Broward County uses the Guide to review fuel economy 
advertisements and to bring enforcement actions in its role as a 
watchdog over the advertising and sale of new vehicles. Without the 
Guide, Broward County believes ``consumers would be at a significant 
disadvantage when buying a new car.'' Broward County also noted that 
the Guide yields benefits for both consumers and industry by 
encouraging consistency in fuel economy advertising, which provides 
``stability and equality for the consumer when purchasing a new car.'' 
In addition, Broward County indicated that, in its view, ``auto dealers 
and manufacturers find it easier, more cost effective and less labor 
intensive to use the pre-determined EPA estimates.''
    While all the comments generally supported the Guide, several noted 
the need to update specific provisions. For example, both Alliance and 
AIAM urged the Commission to amend the Guide to ensure consistency with 
EPA regulations and reflect changes in vehicle technology and fuel use. 
AIAM noted, however, that despite the need for conforming changes, 
there is no need to alter the basic information in the Guide.
    Discussion: The Commission plans to retain the Guide. The comments 
received suggest that the Fuel Economy Guide is useful to both 
consumers and the new vehicle industry. The Guide encourages clarity in 
advertising fuel economy and helps combat unfair or deceptive 
practices. While these benefits are difficult to quantify, the comments 
suggest that they are significant. At the same time, the comments 
indicate that any burdens associated with the Guide are minimal. 
Therefore, it appears that there is a continuing need for the Fuel 
Economy Guide and that its benefits outweigh any costs it may entail. 
In addition, we expect that the Guide's benefits will continue into the 
future. Whether due to high gasoline prices or consumer interest in 
minimizing energy use for environmental reasons, we expect advertisers 
will continue to use fuel economy as a way to distinguish their 
vehicles.
    In addition to retaining the Guide, we are also proposing several 
amendments in response to EPA rule changes and other developments 
related to fuel economy advertising. The emergence of new automobile 
technology, such as electric hybrid vehicles, underscores the 
importance of ensuring that the Guide is applicable to a changing 
market. The proposed amendments, as discussed in detail below, should 
help ensure the Guide keeps pace with these various changes.

B. Definitions--Section 259.1

    Issues, Comments, and Discussion: Several commenters recommended 
changes to the Guide's definitions and citations in light of recent 
changes to EPA requirements. These various terms and issues are 
addressed as follows:
    New Automobile: The current Guide defines ``new automobile'' as 
``[a]ny passenger automobile or light truck for which a fuel economy 
label is required under the Energy Policy and Conservation Act (42 
U.S.C. 6201 et seq.) or rules promulgated thereunder, the equitable or 
legal title to which has never been transferred by a manufacturer, 
distributor, or dealer to an ultimate purchaser.'' The Alliance, NADA, 
AIAM, and Broward County all noted that EPA will require a fuel economy 
label for medium duty passenger vehicles manufactured during the 2011 
model year or thereafter. Accordingly, they suggested that the 
Commission amend the Guide's definition of ``new automobile'' to 
reflect this upcoming change.
    In response to these comments, the Commission proposes to amend the 
definition of ``new automobile'' to include the term ``medium duty 
passenger vehicle.'' The amended definition, however, would only apply 
to vehicles ``for which a fuel economy label is required.'' 
Accordingly, the Guide would not cover medium duty passenger vehicles 
until EPA regulations require labeling for such vehicles in 2011.
    Statutory and Regulatory Citations: Both AIAM and the Alliance 
recommended that the Commission update the Guide's citation to the 
Energy Policy and Conservation Act to 49 U.S.C. 32901. The Alliance 
also suggested changes to the Guide's citations to EPA regulations to 
reflect the new amendments. To remain current in the future, NADA 
recommended that the Commission replace specific cites in the Fuel 
Economy Guide with more general references to EPA regulations such as 
40 CFR Part 600.
    Based on these comments, the Commission proposes to update the 
citation to EPCA (i.e., 49 U.S.C. 32901). In addition, we propose to 
replace specific regulatory citations with a general reference to EPA 
regulations at 40 CFR Part 600. This will reduce the need to amend the 
Guide in the future while still providing a useful reference to EPA 
regulations.
    Fuel Economy: The current Guide uses terms such as ``mpg'' (miles-
per-gallon), ``consumption,'' and ``mileage'' as fuel efficiency 
descriptors for vehicles. The Alliance, NADA, and AIAM suggested the 
Commission use the term ``fuel economy'' when referring to a vehicle's 
fuel efficiency, instead of these other terms because ``fuel economy'' 
is the ``standard industry term . . . and is readily understood by the 
public.'' We agree that the Guide should use the standard industry 
terms. Therefore, we propose to amend the Guide to use the term ``fuel 
economy'' when describing a vehicle's fuel efficiency. Accordingly, the 
proposed amendments use that term in lieu of other descriptors.
    Estimated Highway, City, and Combined Fuel Economy: The current 
Guide provides information on estimated highway and city fuel economy 
but does not provide guidance on combined fuel economy. Both NADA and 
Broward County suggested that the FTC amend the Fuel Economy Guide to 
address claims for combined fuel economy because such information is 
now required on the EPA label. In particular, NADA recommended that the 
FTC adopt EPA's definition of that term.\5\ We agree with the comments 
that the Guide should include references to ``combined fuel economy.'' 
Because manufacturers must disclose such information on EPA's fuel 
economy label, the Guide should also include the

[[Page 19151]]

term in addressing fuel economy advertising claims. This will ensure 
that the scope of the Guide is consistent with the scope of fuel 
economy representations required on the EPA label.
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    \5\ EPA regulations (40 CFR 600.002-08) define ``combined fuel 
economy'' as ``(1) the fuel economy value determined for a vehicle 
(or vehicles) by harmonically averaging the city and highway fuel 
economy values, weighted 0.55 and 0.45 respectively, (2) for 
electric vehicles, the term means the equivalent petroleum-based 
fuel economy value as determined by the calculation procedure 
promulgated by the Secretary of Energy.''
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    Range Claims: In addressing fuel economy range claims, the Guide 
uses the terms ``expected range of fuel economy'' and ``range of 
estimated fuel economy values for the class of new automobiles.'' This 
provision is meant to apply to any claims related to a fuel economy 
range and not just claims containing these specific terms. To clarify 
this intent, we propose to add the phrase ``or similar language'' 
following the appearance of the terms ``expected range of fuel 
economy'' and ``range of estimated fuel economy values for the class of 
new automobiles.''\6\
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    \6\ Broward County recommended that the definition of 
``estimated in-use fuel economy range'' at Section 259.1(e) include 
the EPA-required phrase ``Expected range for most drivers [ ] to [ ] 
MPG.'' See 40 CFR 600.307-08(b)(5). We expect that the insertion of 
the phrase ``or similar language'' will address that concern.
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    Other Minor Changes: We also propose to make the following four, 
minor changes to the Guide:
 MPG. We propose amending the Guide's definitions for city and highway 
fuel economy estimates so that they are consistent with the terms and 
definitions used by EPA. For example, we propose to change the term 
``estimated city mpg'' to ``estimated city fuel economy,'' the term 
used by EPA in its regulations.\7\
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    \7\ The proposed definitions for these two terms read: 
``Estimated city fuel economy. The city fuel economy determined in 
accordance with the city test procedure employed and published by 
the U.S. Environmental Protection Agency as described in 40 CFR Part 
600 and expressed in miles-per-gallon, to the nearest whole mile-
per-gallon, as measured, reported, published, or accepted by the 
U.S. Environmental Protection Agency''; and ``Estimated highway fuel 
economy. The highway fuel economy determined in accordance with the 
highway test procedure employed and published by the U.S. 
Environmental Protection Agency as described in 40 CFR Part 600 and 
expressed in miles-per-gallon, to the nearest whole mile-per-gallon, 
as measured, reported, published, or accepted by the U.S. 
Environmental Protection Agency.''

 In-Use. We propose eliminating the words ``in-use'' from the term for 
fuel economy range because ``in-use'' is not generally used by EPA and 
also may imply that data is generated from actual driving conditions 
and not the laboratory tests required by EPA regulations.\8\
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    \8\ The proposed definition reads: ``Range of fuel economy. The 
range of city, highway, or combined fuel economy of the particular 
new automobile on which the label is affixed, as determined in 
accordance with procedures employed by the U.S. Environmental 
Protection Agency as described in 40 CFR Part 600 and expressed in 
miles-per-gallon, to the nearest whole mile-per-gallon, as measured, 
reported, or accepted by the U.S. Environment Protection Agency.''

 Unique Nameplate. We propose eliminating an obsolete reference to the 
term ``unique nameplate'' in footnote 2 of the Guide and replacing it 
with the more appropriate EPA term ``model type.''\9\
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    \9\ The relevant portion of the proposed footnote language 
reads: ``Fuel economy estimates assigned to model types (see 40 CFR 
600.208-08(a)(2)), should not be used for other vehicles in a car 
line that have different fuel economy ratings. For example, if a 
manufacturer has a model named the `XZA' that has fuel economy 
estimates assigned to it and a derivative model named the `Econo-
XZA' that has separate, higher fuel economy estimates assigned to 
it, these higher numbers assigned to the `Econo-XZA' cannot be used 
in advertisements for the `XZA.'''

 New Automobile. Embedded within the definition of ``new automobile'' 
in the current Guide are other definitions for the terms ``dealer,'' 
``manufacturer,'' and ``ultimate purchaser.'' We propose to amend this 
provision by creating separate definitions for these latter three 
terms.

C. Non-EPA Estimates--Section 259.2(c)

    Issue and Comments: Section 259.2(c) of the Guide addresses fuel 
economy claims derived from non-EPA tests. The Guide indicates that 
advertisers can make fuel economy claims based on non-EPA information 
as long as they: 1) disclose the corresponding EPA estimates with more 
prominence than other estimates, 2) identify the source of the non-EPA 
information, and 3) disclose how their non-EPA test differs from the 
EPA test in terms of driving conditions and other relevant variables.
    NADA suggested that the Commission delete Section 259.2(c) because 
the ``benefit of being able to advertise non-EPA fuel economy estimates 
is outweighed by the need for uniformity, clarity, and fairness.'' In 
its view, the FTC should retain this section only if there is evidence 
that sellers regularly advertise ``non-EPA fuel economy estimates, and 
are expected to conduct similar advertising in the future.'' Broward 
County did not suggest that FTC eliminate this section but recommended 
changes in light of EPA's recent amendments. In particular, it 
recommended the addition of more examples in Section 259.2(c)(3) of the 
test conditions and variables that may differ from those covered by the 
EPA test, such as high speed/rapid acceleration driving, use of air 
conditioning, cold temperature operation, road grade, wind, tire 
pressure, load, and the effects of different fuel properties.
    Discussion: The Commission proposes retaining the Guide's current 
provision related to non-EPA fuel economy claims. We have identified no 
basis to prohibit fuel economy advertising claims based on non-EPA 
tests. We recognize that many interested parties favor disclosure of 
EPA data because it creates a level playing field for industry members 
and provides familiar, standardized information for consumers. In 
addition, claims based on the non-EPA data have the potential to 
mislead consumers if the basis for such claims are not adequately 
disclosed. We have no evidence, however, to conclude that such claims 
are deceptive in all contexts. Accordingly, the proposed amended Guide 
retains the section related to non-EPA tests.
    We are not proposing to expand the list of examples related to test 
conditions and variables that advertisers may need to disclose when 
making fuel economy claims based on non-EPA testing, as suggested by 
Broward County. The current Guide is clear that the existing five 
examples are not exhaustive. Absent clear evidence of problems with 
particular test discrepancies (e.g., tire pressure, road grade), there 
appears to be little benefit in adding additional examples to the 
list.\10\
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    \10\ Footnotes 7 and 8 in the current Guide provide guidance 
regarding the relative size and prominence of fuel economy claims 
based on non-EPA and EPA estimates in television, radio, and print 
advertisements. We propose to add language clarifying that these 
footnotes provide examples and do not dictate the only approach in 
every context. We recognize that there may be other ways to ensure 
that the EPA estimates receive ``more prominence than any other 
estimate'' beyond those detailed in these footnotes. The proposed 
language also clarifies that the guidance applies to any advertising 
medium, not only to television, radio, and print.
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D. Alternative Fueled Vehicles

    Issue and Comments: When addressing fuel economy estimates, the 
current Guide refers to ``gasoline consumption or mileage of new 
automobiles'' (emphasis added). It does not mention other fuel types 
such as diesel, electricity, and ethanol. The comments questioned 
whether the Guide is unnecessarily limited to advertisements involving 
gasoline. The Alliance argued that such a limitation is inappropriate 
because many vehicles also run on alternative fuels. NADA explained 
that manufacturers are producing new vehicle types such as hybrids 
designed to run on electricity, liquid fuel, or a combination of the 
two; dedicated alternative fuel vehicles; and dual or flex-fuel 
vehicles. NADA recommended that the Guide require disclosure of: 1) all 
fuels used by new vehicles; 2) the fuels actually used to

[[Page 19152]]

generate advertised EPA estimates; and 3) any appropriate information 
from the Commission's labeling requirements for alternative fuels and 
alternative fueled vehicles (16 CFR Part 309). For example, NADA 
suggested that advertisements for dual or flex-fuel vehicles indicate 
the estimated range for each type of fuel. NADA believes that such 
information would ``enable consumers to better compare vehicles using 
the same fuel and/or technology and to better compare new technology 
and alternative fuel vehicles to their gasoline counterparts.''
    Discussion: The Commission proposes to amend the Guide in two 
respects related to alternative fuel vehicles. First, we propose to 
clarify that the Guide's provisions apply to all fuel types covered by 
EPA's current fuel economy labeling program. Second, we propose adding 
guidance related to advertising claims for the cruising range of 
vehicles run by alternative fuels such as electricity.
    First, we agree with commenters that the FTC's guidance should 
cover claims related to newer vehicle types and a broader range of fuel 
categories to help advertisers avoid making deceptive claims in the 
changing automobile market. The amendments, therefore, would remove 
references to ``gasoline'' throughout the Guide (e.g., in the 
definitions for city and highway fuel economy) and replace them with 
references to the term ``fuel.'' The proposed amendments would also add 
a definition for ``fuel'' to the Guide that specifically refers to 
fuels covered under EPA's current labeling requirements, namely 
gasoline, electricity, alcohol, and natural gas.\11\
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    \11\ See https://www.fueleconomy.gov/ for a list of currently 
available alternative fueled vehicles.
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    Second, the Commission proposes to add guidance related to cruising 
range information for alternative fueled vehicles, as suggested by 
NADA. The FTC's Alternative Fueled Vehicle Rule (16 CFR Part 309) 
requires estimated cruising range disclosures on labels for alternative 
fuel vehicles such as those powered by electricity, natural gas, and 
hydrogen.\12\ For most alternative fueled vehicle types, the Rule also 
identifies specific procedures manufacturers must use to calculate 
those cruising ranges (e.g., EPA- and FTC-mandated procedures for most 
vehicles).\13\ Cruising ranges provide consumers with important 
information about the number of miles vehicles will travel between 
refueling (e.g., the number of miles an electric vehicle will travel on 
a single charge).
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    \12\ The FTC's labeling requirements apply to vehicles capable 
of operating on methanol (or other alcohols), ethanol at mixtures of 
85 percent or more, natural gas, liquefied petroleum gas, hydrogen, 
coal-derived liquid fuels, fuels derived from biological materials, 
and electricity. See 16 CFR 309.1.
    \13\ For most vehicles, the FTC Rule requires the use of EPA 
fuel economy data to derive cruising ranges. For electric vehicles, 
however, manufacturers must determine cruising ranges using Society 
of Automotive Engineers (``SAE'') Surface Vehicle Recommended 
Practice SAE J1634--1993--05--20, ``Electric Vehicle Energy 
Consumption and Range Test Procedure.'' 16 CFR 309.22(a)(2). For 
non-electric vehicles that are not subject to EPA's fuel economy 
labeling regulations (40 CFR Part 600) (e.g., certain ethanol 
vehicles), the FTC's Alternative Fuel Vehicle Rule requires 
manufacturers to have competent and reliable evidence that 
substantiates the minimum and maximum number of miles the vehicle 
will travel between refueling and recharging. See 16 CFR 309.22.
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    Industry trends suggest that advertisements related to cruising 
range will increase over the next several years. Recently, 
manufacturers have increased their development and marketing of 
vehicles that use alternative fuels such as ethanol\14\ and compressed 
natural gas. They are also developing a variety of vehicles that use 
technologies not previously available on a wide basis, such as plug-in 
electric vehicles (``PHEVs''), pure electric vehicles (``EVs''), and 
vehicles that use hydrogen fuel cell technology. Given these 
developments, advertising claims for cruising range are likely to 
become more prevalent.
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    \14\ Although EPA's fuel economy labeling requirements currently 
do not apply to ethanol, EPA is considering the issue. See 71 FR at 
77904-05.
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    Though we expect that most advertisers will use the FTC-required 
procedures to derive cruising range estimates, some may seek to use 
alternative estimates in advertising. Such claims, advertised without 
qualification, could harm consumers by confusing or deceiving those who 
assume the cruising range estimates appearing in advertisements are the 
same as those appearing on the FTC-required vehicle label. To avoid 
such problems, the proposed Guide amendments would indicate that 
advertisers making such claims should identify the estimate required on 
the FTC label, disclose the source of the non-FTC derived cruising 
range information, and describe any material differences between the 
FTC-mandated and non-FTC procedures.\15\ Because the Commission already 
has established similar guidance for analogous claims related to fuel 
economy in Section 259.2(c), we have based this new proposed guidance 
for alternative fuel vehicle claims on those existing provisions.
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    \15\ As part of these proposed changes related to alternative 
fueled vehicles, the amendments would also add definitions to 
Section 259.1 for ``alternative fueled vehicle'' and ``estimated 
cruising range.''
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    We invite comments on this proposal. In particular, we seek 
information on whether cruising range estimates will become 
increasingly prevalent in the future and whether the proposed guidance 
is necessary to help prevent deceptive advertising.

E. Model Year

    Issue and Comments: The current Fuel Economy Guide does not address 
a vehicle's model year. NADA suggested that fuel economy advertisements 
should specify the vehicle's model year because EPA's new fuel economy 
standards took effect in model year 2008. NADA believes that clear 
disclosure of model year is important to allow consumers to make 
appropriate comparisons between models labeled with the old test 
results and those labeled with the new results.
    Response: The Commission is not proposing to change the Guide to 
address disclosures related to model year. We understand that the EPA 
test procedure amendments yielded fuel economy numbers for all 2008 
vehicles that are substantially different from those for 2007 models. 
This inconsistency, however, reflected a temporary transition and we 
expect that any confusion has diminished as 2007 vehicles have been 
sold. Accordingly, any specific guidance on the use of model year 
information in advertisements in the Fuel Economy Guide would be 
obsolete.\16\
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    \16\ We note that nothing prohibits the inclusion of model year 
information in an advertisement.
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F. Consumer Education

    Issue and Comments: Broward County urged the Commission to increase 
its consumer education efforts to ensure that consumers understand the 
impact of changes in EPA's test procedures.
    Discussion: The Commission currently provides consumers with 
information related to fuel and fuel economy through its website at 
(https://www.ftc.gov/energy). These resources include information on gas 
mileage, questionable ``gas-savings'' products, alternative fueled 
vehicles, and octane ratings. We will consider adding additional 
consumer education materials as appropriate. As for information about 
the new fuel economy estimates, we note that EPA and DOE already 
maintain a website https://www.fueleconomy.gov that provides 
comprehensive consumer information on the fuel economy issues, 
including detailed information on the new fuel economy ratings and 
labels

[[Page 19153]]

(https://www.fueleconomy.gov/feg/ratings2008.shtml).

III. Request for Comment and Regulatory Review Program

    The Commission solicits written public comments on any aspect of 
the proposed amendments to the Fuel Economy Guide announced in this 
Notice. We specifically request comments on the following questions:
    (1) What costs or burdens, or other impacts, would the proposed 
amendments impose, and on whom? What evidence supports the asserted 
costs, burdens, or other impacts?
    (2) What modifications, if any, should the Commission make to the 
proposed amendments to increase their benefits to consumers?
    (a) What evidence supports your proposed modifications? Please 
submit any such evidence.
    (b) How would these modifications affect the costs and benefits of 
the proposed amendments for consumers?
    (c) How would these modifications affect the costs and benefits of 
the proposed requirements for businesses, and in particular, small 
businesses?
    (3) What modifications, if any, should the Commission make to the 
proposed amendments to decrease their burdens on businesses?
    (a) What evidence supports your proposed modifications? Please 
submit any such evidence.
    (b) How would these modifications affect the costs and benefits of 
the proposed requirements for consumers?
    (c) How would these modifications affect the costs and benefits of 
the proposed requirements for businesses, and in particular, small 
businesses?
    (4) Should the Guide include provisions related to cruising range 
claims for alternative fuel vehicles as proposed? Will cruising range 
estimates become increasingly prevalent in the future? Is the proposed 
guidance necessary to help prevent deceptive advertising related to 
such claims?

List of Subjects in 16 CFR Part 259

    Advertising, Fuel economy, Trade practices.
    For the reasons set forth in the preamble, the Commission proposes 
to amend 16 CFR Part 259 as follows:

PART 259--GUIDE CONCERNING FUEL ECONOMY ADVERTISING FOR NEW 
AUTOMOBILES

    1. The authority citation for part 259 continues to read as 
follows:

    Authority: 15 U.S.C. 41--58.

    2. Section 259.1 is revised to read as follows:


Sec.  259.1  Definitions.

    For the purposes of this part, the following definitions shall 
apply:
    (a) Alternative fueled vehicle. Any vehicle that qualifies as a 
covered vehicle under 16 CFR Part 309.
    (b) Dealer. Any person located in the United States or any 
territory thereof engaged in the sale or distribution of new 
automobiles to the ultimate purchaser.
    (c) Estimated city fuel economy. The city fuel economy determined 
in accordance with the city test procedure employed and published by 
the U.S. Environmental Protection Agency as described in 40 CFR Part 
600 and expressed in miles-per-gallon, to the nearest whole mile-per-
gallon, as measured, reported, published, or accepted by the U.S. 
Environmental Protection Agency.
    (d) Estimated combined fuel economy. The combined fuel economy 
value determined for a vehicle (or vehicles) in accordance with U.S. 
Environmental Protection Agency regulations described in 40 CFR Part 
600 and expressed in miles-per-gallon, to the nearest whole mile-per-
gallon, as measured, reported, published, or accepted by the U.S. 
Environmental Protection Agency.
    (e) Estimated cruising range. An estimate of the number of miles an 
alternative fueled vehicle will travel between refueling as defined and 
determined pursuant to 16 CFR Part 309.
    (f) Estimated highway fuel economy. The highway fuel economy 
determined in accordance with the highway test procedure employed and 
published by the U.S. Environmental Protection Agency as described in 
40 CFR Part 600 and expressed in miles-per-gallon, to the nearest whole 
mile-per-gallon, as measured, reported, published, or accepted by the 
U.S. Environmental Protection Agency.
    (g) Fuel.
    (1) Gasoline and diesel fuel for gasoline- or diesel-powered 
automobiles; or
    (2) Electrical energy for electrically powered automobiles; or
    (3) Alcohol for alcohol-powered automobiles; or
    (4) Natural gas for natural gas-powered automobiles.
    (h) Fuel economy. (1) The average number of miles traveled by an 
automobile or group of automobiles per volume of fuel consumed as 
calculated in this part; or
    (2) The equivalent petroleum-based fuel economy for an electrically 
powered automobile as determined by the Secretary of Energy.
    (i) Manufacturer. Any person engaged in the manufacturing or 
assembling of new automobiles, including any person importing new 
automobiles for resale and any person who acts for and is under the 
control of such manufacturer, assembler, or importer in connection with 
the distribution of new automobiles.
    (j) New automobile. Any passenger automobile, medium duty passenger 
vehicle, or light truck for which a fuel economy label is required 
under the Energy Policy and Conservation Act (42 U.S.C. 32901 et seq.) 
or rules promulgated thereunder, the equitable or legal title to which 
has never been transferred by a manufacturer, distributor, or dealer to 
an ultimate purchaser.
    (k) Range of fuel economy. The range of city, highway, or combined 
fuel economy of the particular new automobile on which the label is 
affixed, as determined in accordance with procedures employed by the 
U.S. Environmental Protection Agency as described in 40 CFR Part 600, 
and expressed in miles-per-gallon, to the nearest whole mile-per-
gallon, as measured, reported, or accepted by the U.S. Environmental 
Protection Agency.
    (l) Ultimate purchaser. The first person, other than a dealer 
purchasing in his or her capacity as a dealer, who in good faith 
purchases a new automobile for purposes other than resale, including a 
person who leases such vehicle for his or her personal use.
    (m) Vehicle configuration. The unique combination of automobile 
features, as defined in 40 CFR Part 600.
    3. Section 259.2 is revised to read as follows:


Sec.  259.2  Advertising disclosures.

    (a) No manufacturer or dealer shall make any express or implied 
representation in advertising concerning the fuel economy of any new 
automobile\1\ unless such representation is accompanied by the 
following clear and conspicuous disclosures:
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    \1\ The Commission will regard as an express or implied fuel 
economy representation one which a reasonable consumer, upon 
considering the representation in the context of the entire 
advertisement, would understand as referring to the fuel economy of 
the vehicle or vehicles advertised.
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    (1) If the advertisement makes:
    (i) Representations about city, highway, and combined fuel economy, 
or any combination of the three, the advertisement must disclose the 
applicable estimated fuel economy information for each type of fuel

[[Page 19154]]

economy represented in the advertisement;\2\
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    \2\ For purposes of Sec. 259.2(a), the ``city fuel economy,'' 
the ``highway fuel economy,'' and the ``combined fuel economy'' must 
be those applicable to the specific model type being advertised. 
Fuel economy estimates assigned to model types (see 40 CFR 600.208-
08(a)(2)), should not be used for other vehicles in a car line that 
have different fuel economy ratings. For example, if a manufacturer 
has a model named the ``XZA'' that has fuel economy estimates 
assigned to it and a derivative model named the ``Econo-XZA'' that 
has separate, higher fuel economy estimates assigned to it, these 
higher numbers assigned to the ``Econo-XZA'' cannot be used in 
advertisements for the ``XZA.''
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    (ii) A representation regarding only city, only highway, or only 
combined fuel economy, the corresponding EPA fuel economy estimate must 
be disclosed;\3\
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    \3\ For example, if the representation clearly refers only to 
highway fuel economy, only the ``estimated highway fuel economy'' 
need be disclosed.
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    (iii) A general fuel economy claim without reference to any 
estimated fuel economy determined pursuant to EPA requirements, the 
estimated city fuel economy must be disclosed.\4\
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    \4\ Nothing in this section should be construed as prohibiting 
disclosure of both the city and highway estimates.
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    (2) That the U.S. Environmental Protection Agency is the source of 
the estimated ``city fuel economy,'' ``highway fuel economy,'' and 
``combined fuel economy,'' and that the numbers are estimates.\5\
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    \5\ The Commission will regard the following as the minimum 
disclosure necessary to comply with Sec. 259.2(a)(2), regardless of 
the media in which the advertisement appears:
    ``EPA estimate(s).'' For video, if the estimated mpg appears in 
the visual, the disclosure must appear visually; if the estimated 
mpg is audio, the disclosure must be audio.
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    (b) If an advertisement for a new automobile cites:
    (1) The ``expected range of fuel economy'' or similar language, the 
advertisement must state with equal prominence both the upper and lower 
number of the range, an explanation of the meaning of the numbers 
(i.e., city fuel economy range or highway fuel economy range or 
combined fuel economy range or any combination of the three), and that 
the U.S. Environmental Protection Agency is the source of the figures.
    (2) The ``range of estimated fuel economy values for the class of 
new automobiles'' or similar language as a basis for comparing the fuel 
economy of two or more automobiles, such comparison must be made to the 
same type of range (i.e., city, highway, or combined).\6\
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    \6\ For example, an advertisement could not promote a vehicle's 
fuel economy by comparing the vehicle's estimated highway fuel 
economy to the city estimates of other vehicles in its class.
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    (c) Fuel economy estimates derived from a non-EPA test may be 
disclosed provided that:
    (1) The advertisement also discloses the ``estimated city fuel 
economy,'' the ``estimated highway fuel economy,'' and/or the 
``estimated combined fuel economy'' as required by Sec. 259.2(a), and 
the disclosure required by Sec. 259.2(a), and gives the ``estimated 
city fuel economy,'' the ``estimated highway fuel economy,'' and/or the 
``estimated combined fuel economy'' figure(s) substantially more 
prominence than any other estimate;\7\ provided, however, for any 
advertising medium in which any other estimate is used in the audio, 
equal prominence must be given the ``city fuel economy,'' the ``highway 
fuel economy,'' and/or the ``combined fuel economy'' figure(s);\8\
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    \7\ For example, the Commission regards the following as 
constituting ``substantially more prominence:''
    For video: If the estimate derived from the non-EPA test appears 
in the visual portion, the estimated city, highway, and/or combined 
mpg should appear in numbers twice as large as those used for any 
other estimate, and remain on the screen at least as long as any 
other estimate. Alternatively, if the estimate derived from the non-
EPA test appears in the visual portion, the estimated city, highway, 
and/or combined mpg should (1) appear simultaneously and with at 
least equal prominence as the other mileage estimate(s) in the 
visual portion, and (2) be stated in the audio portion. Each visual 
estimated city, highway, and/or combined mpg should be broadcast 
against a solid color background that contrasts easily with the 
color used for the numbers.
    For print: The estimated city, highway, and/or combined mpg 
should appear in clearly legible type at least twice as large as 
that used for any other estimate or in type of the same size as such 
other estimate, if it is clearly legible and conspicuously circled. 
The estimated city, highway, and/or combined mpg should appear 
against a solid color, contrasting background. They should not 
appear in a footnote unless all references to fuel economy appear in 
a footnote.
    \8\ For example, the Commission regards the following as 
constituting equal prominence: The estimated city, highway, and/or 
combined mpg should be stated, either before or after each 
disclosure of such other estimate at least as audibly as such other 
estimate.
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    (2) The source of the non-EPA test is clearly and conspicuously 
identified;
    (3) The driving conditions and variables simulated by the test 
which differ from those used to measure the ``estimated city fuel 
economy,'' the ``estimated highway fuel economy,'' and/or the 
``estimated combined fuel economy'' and which result in a change in 
fuel economy, are clearly and conspicuously disclosed;\9\ and
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    \9\ For dynamometer tests any difference between the EPA and 
non-EPA tests must be disclosed. For in-use tests, the Commission 
realizes that it is impossible to duplicate the EPA test conditions, 
and that in-use tests may be designed to simulate a particular 
driving situation. It must be clear from the context of the 
advertisement what driving situation is being simulated (e.g., cold 
weather driving, highway driving, and heavy load conditions). 
Furthermore, any driving or vehicle condition must be disclosed if 
it is significantly different from that which an appreciable number 
of consumers (whose driving condition is being simulated) would 
expect to encounter.
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    (4) The advertisement clearly and conspicuously discloses any 
distinctions in ``vehicle configuration'' and other equipment affecting 
mileage performance (e.g., design or equipment differences which 
distinguish subconfigurations as defined by EPA) between the 
automobiles tested in the non-EPA test and the EPA tests.
    (d) If an advertisement contains an estimated cruising range for an 
alternative fueled vehicle that is not determined in accordance with 
FTC's Labeling Requirements for Alternative Fuels and Alternative 
Fueled Vehicles (16 CFR Part 309), the advertisement must disclose 
clearly and conspicuously:
    (1) The estimated cruising range required on the FTC label (16 CFR 
Part 309) with substantially more prominence than any other estimate; 
provided, however, for any advertising medium in which any other 
estimate is used only in the audio, equal prominence must be given the 
estimated cruising range that is required on the FTC label;\10\
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    \10\ See footnotes 7 and 8 for guidance on prominence.
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    (2) The source of the cruising range estimate; and
    (3) Any material differences between the method used and the method 
required by the FTC's labeling requirements at 16 CFR 309.22.
    By direction of the Commission.

Donald S. Clark,
Secretary.
[FR Doc. E9-9649 Filed 4-27-09: 8:45 am]
BILLING CODE 6750-01-S