Koenigsegg Automotive AB; Morgan Motor Company Limited; Receipt of Applications for Renewals of Temporary Exemptions From the Advanced Air Bag Requirements of FMVSS No. 208, 20082-20087 [2011-8468]
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20082
Federal Register / Vol. 76, No. 69 / Monday, April 11, 2011 / Notices
[FR Doc. 2011–8532 Filed 4–8–11; 8:45 am]
BILLING CODE 4910–81–P
DEPARTMENT OF TRANSPORTATION
National Highway Traffic Safety
Administration
[Docket No. NHTSA–2011–0006]
Koenigsegg Automotive AB; Morgan
Motor Company Limited; Receipt of
Applications for Renewals of
Temporary Exemptions From the
Advanced Air Bag Requirements of
FMVSS No. 208
National Highway Traffic
Safety Administration (NHTSA),
Department of Transportation (DOT).
ACTION: Notice of receipt of applications
for renewals of temporary exemptions
and request for comments.
AGENCY:
In accordance with the
procedures in 49 CFR Part 555,
Koenigsegg Automotive AB
Koenigsegg’’) and Morgan Motor
Company Limited (‘‘Morgan’’) have
petitioned the agency for renewals of
temporary exemption from advanced air
bag requirements of FMVSS No. 208,
‘‘Occupant crash protection.’’The basis
for each application is that compliance
would cause substantial economic
hardship to a manufacturer that has
tried in good faith to comply with the
standard.
This notice of receipt of applications
for renewal of temporary exemptions is
published in accordance with the
statutory provisions of 49 U.S.C.
30113(b)(2). Please note that we are
publishing together the notice of receipt
of the two applications for renewal to
ensure efficient use of agency resources
and to facilitate processing of the
applications. NHTSA has made no
judgments on the merits of each
application. NHTSA will consider each
application separately. We ask that
commenters also consider each
application separately and submit
comments specific to individual
applications.
SUMMARY:
Comments must be received on
or before May 11, 2011.
ADDRESSES: You may submit comments
to the docket number identified in the
heading of this document by any of the
following methods:
• Federal eRulemaking Portal: Go to
https://www.regulations.gov. Follow the
online instructions for submitting
comments.
• Mail: Docket Management Facility,
M–30, U.S. Department of
Transportation, West Building, Ground
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Floor, Rm. W12–140, 1200 New Jersey
Avenue, SE., Washington, DC 20590.
• Hand Delivery or Courier: West
Building Ground Floor, Room W12–140,
1200 New Jersey Avenue, SE., between
9 a.m. and 5 p.m. Eastern Time, Monday
through Friday, except Federal holidays.
• Fax: (202) 493–2251.
Regardless of how you submit your
comments, you should mention the
docket number of this document.
You may call the Docket at 202–366–
9324.
Instructions: For detailed instructions
on submitting comments and additional
information on the rulemaking process,
see the Public Participation heading of
the Supplementary Information section
of this document. Note that all
comments received will be posted
without change to https://
www.regulations.gov, including any
personal information provided. Please
see the Privacy Act discussion below.
Privacy Act: Anyone is able to search
the electronic form of all comments
received into any of our dockets by the
name of the individual submitting the
comment (or signing the comment, if
submitted on behalf of an association,
business, labor union, etc.). You may
review DOT’s complete Privacy Act
Statement in the Federal Register
published on April 11, 2000 (65 FR
19477–78).
We shall consider all comments
received before the close of business on
the comment closing date indicated
below. To the extent possible, we shall
also consider comments filed after the
closing date.
FOR FURTHER INFORMATION CONTACT: Ms.
Dorothy Nakama, Office of the Chief
Counsel, NCC–112, National Highway
Traffic Safety Administration, 1200 New
Jersey Ave., SE., Washington, DC 20590.
Telephone: (202) 366–2992; Fax: (202)
366–3820.
I. Advanced Air Bag Requirements and
Small Volume Manufacturers
In 2000, NHTSA upgraded the
requirements for air bags in passenger
cars and light trucks, requiring what are
commonly known as ‘‘advanced air
bags.’’ 1 The upgrade was designed to
meet the goals of improving protection
for occupants of all sizes, belted and
unbelted, in moderate-to-high-speed
crashes, and of minimizing the risks
posed by air bags to infants, children,
and other occupants, especially in lowspeed crashes. The rule accomplished
this by establishing new test
requirements and injury criteria and
specifying the use of an entire family of
1 See
65 FR 30680 (May 12, 2000) (Docket No.
NHTSA–2000–7013).
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test dummies: the then-existing dummy
representing 50th percentile adult
males, and new dummies representing
5th percentile adult females, 6-year-old
children, 3-year-old children, and
1-year-old infants.
The advanced air bag requirements
were a culmination of a comprehensive
plan that the agency announced in 1996
to address the adverse effects of air bags.
This plan also included an extensive
consumer education program to
encourage the placement of children in
rear seats.
The new requirements were phased in
beginning with the 2004 model year.
Small volume manufacturers (i.e.,
original vehicle manufacturers
producing or assembling fewer than
5,000 vehicles annually for sale in the
United States) were not subject to the
advanced air bag requirements until
September 1, 2006.
In recent years, NHTSA has addressed
a number of petitions for exemption
from the advanced air bag requirements
of FMVSS No. 208. The majority of
these requests have come from small
manufacturers which have petitioned on
the basis of substantial economic
hardship to a manufacturer that has
tried in good faith to comply with the
standard.
Although NHTSA has granted a
number of these petitions in situations
where the manufacturer is supplying
standard air bags in lieu of advanced air
bags,2 NHTSA is considering (1)
whether it is in the public interest to
continue to grant such petitions,
particularly in the same manner as in
the past, given the number of years
these requirements have now been in
effect and the benefits of advanced air
bags, and (2) to the extent such petitions
are granted, what plans and
countermeasures to protect child and
infant occupants, short of compliance
with the advanced air bags, should be
expected.
Given the passage of time since the
advanced air bag requirements were
established and have been
implemented, and in light of the
benefits of advanced air bags, NHTSA is
considering whether it is in the public
interest to continue to grant exemptions
from these requirements, particularly in
the same manner as in the past. The
costs of compliance with the advanced
air bag requirements of FMVSS No. 208
are costs that all entrants to the U.S.
automobile marketplace should expect
to bear. Furthermore, NHTSA
understands that, in contrast to the
2 See, e.g., grant of petition to Panoz, 72 FR 28759
(May 22, 2007), or grant of petition to Koenigsegg,
72 FR 17608 (April 9, 2007).
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initial years after the advanced air bag
requirements went into effect, low
volume manufacturers now have access
to advanced air bag technology.
Accordingly, NHTSA tentatively
concludes that the expense of advanced
air bag technology may not now be
sufficient, in and of itself, to justify the
grant of a petition for a hardship
exemption from the advanced air bag
requirements.
NHTSA further notes that exemptions
from motor vehicle safety standards are
to be granted on a ‘‘temporary basis.’’ 3
In prior petitions NHTSA has granted
temporary exemptions from the
advanced air bag requirements as a
means of affording eligible
manufacturers a transition period to
comply with the exempted standard.
Accordingly, in deciding whether to
grant an exemption based on substantial
economic hardship, NHTSA ordinarily
considers the steps that the
manufacturer has already taken to
achieve compliance, as well as the
future steps the manufacturer plans to
take during the exemption period and
the estimated date by which full
compliance will be achieved.4
NHTSA invites comment on whether
and in what circumstances (e.g., nature
of vehicles, number of vehicles, level of
efforts to comply with the requirements,
timing as to number of years since the
requirements were implemented, etc.) it
should continue to grant petitions for
exemptions from the advanced air bag
requirements of FMVSS No. 208. We
note that any policy statements we may
make in this area would not have the
effect of precluding manufacturers from
submitting subsequent petitions for
exemption. However, we believe it
could be helpful for manufacturers to
know our general views in advance of
submitting a petition.
We also request comment on the issue
of, to the extent such petitions are
granted, what plans and
countermeasures to protect child and
infant occupants, short of compliance
with the advanced air bags, should be
expected. We note that in responding to
some recent petitions for exemption
from the advanced air bag requirements
of FMVSS No. 208, NHTSA has
considered the fact that the petitioner
planned to install some
countermeasures for the protection of
child passengers.5
NHTSA also invites comment on the
likelihood that a child or infant will be
3 49
U.S.C. 30113(b)(1).
CFR 555.6(a)(2).
5 See, e.g., grant of petition of Think Technology
AS, 74 FR 40634–01 (Aug. 12, 2009); grant of
petition of Ferrari S.p.A., 74 FR 36303–02 (July 22,
2009).
4 49
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a passenger in either a Morgan or
Koenigsegg vehicle sold in the U.S.
As always, we are concerned about
the potential safety implication of any
temporary exemption granted by this
agency. In the present case, we are
addressing two petitions that seek
renewals of temporary exemptions from
the advanced air bag requirements. Each
petitioner is a manufacturer of low
volume, specialty sports cars.
II. Overview of Petitions for Economic
Hardship Exemption
In accordance with 49 U.S.C. 30113
and the procedures in 49 CFR Part 555,
Koenigsegg Automotive AB
(‘‘Koenigsegg’’) and Morgan Motor
Company (‘‘Morgan’’) have petitioned
the agency for renewals of temporary
exemptions from certain advanced air
bag requirements of FMVSS No. 208
(S14).
The basis for Koenigsegg’s application
and for Morgan’s application is that
compliance would cause substantial
economic hardship 6 to a manufacturer
that has tried in good faith to comply
with that standard. A copy of each
petition 7 is available for review and has
been placed in the docket for this
notice. The agency closely examines
and considers the information provided
by manufacturers in support of these
factors, and, in addition, pursuant to
49 U.S.C. 30113(b)(3)(A), determines
whether exemption is in the public
interest and consistent with the Safety
Act.8
A manufacturer is eligible to apply for
a hardship exemption if its total motor
vehicle production in its most recent
year of production did not exceed
10,000 vehicles, as determined by the
NHTSA Administrator (49 U.S.C.
30113).
Finally, while 49 U.S.C. 30113(b)
states that exemptions from a Safety Act
standard are to be granted on a
‘‘temporary basis,’’ 9 the statute also
expressly provides for renewal of an
6 When considering financial matters involving
companies based in the European Union (EU), it is
important to recognize that EU and U.S. accounting
principles have certain differences in their
treatment of revenue, expenses, and profits. Public
statements by EU manufacturers relating to
financial results should be understood in this
context. This agency analyzes claims of financial
hardship carefully and in accordance with U.S.
accounting principles.
7 Morgan has requested confidential treatment
under 49 CFR Part 512 for certain business and
financial information submitted as part of its
petition for temporary exemption. Accordingly, the
information placed in the docket does not contain
such information that the agency has determined to
be confidential.
8 The Safety Act is codified as Title 49, United
States Code, Chapter 301.
9 49 U.S.C 30113(b)(1).
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exemption on reapplication.
Manufacturers are nevertheless
cautioned that the agency’s decision to
grant an initial petition in no way
predetermines that the agency will
repeatedly grant renewal petitions,
thereby imparting semi-permanent
exemption from a safety standard.
Exempted manufacturers seeking
renewal must bear in mind that the
agency is directed to consider financial
hardship as but one factor, along with
the manufacturer’s on-going good faith
efforts to comply with the regulation,
the public interest, consistency with the
Safety Act, generally, as well as other
such matters provided in the statute.
We note that under 49 CFR 555.8(e),
‘‘If an application for renewal of
temporary exemption that meets the
requirements of § 555.5 has been filed
not later than 60 days before the
termination date of an exemption, the
exemption does not terminate until the
Administrator grants or denies the
application for renewal.’’ In the case of
the petitions for renewal from both
Koenigsegg and Morgan, each
manufacturer submitted its petition for
renewal by the deadline stated in
49 CFR 555.8(e).
III. Petition of Koenigsegg
Background—Koenigsegg Automotive
is a Swedish corporation formed in 1999
to produce high-performance sports
cars, which are not intended for daily
commuting purposes. Koenigsegg is a
privately owned company with fewer
than 100 shareholders, and
manufactures fewer than 50 cars per
year. At the time Koenigsegg applied for
its initial exemption, the Koenigsegg
product line for U.S. sale consisted of
the CC model. The Koenigsegg CCX was
developed as the next generation of
Koenigsegg vehicles after production of
the CCR model ended on December 30,
2005. The CCX model (the subject of
Koenigsegg’s petitions for temporary
exemption) was scheduled to go into
production in 2006 and to continue at
least through the end of 2009.
Originally, planning to sell vehicles
only in the European, Mid-East, and
Far-East markets, Koenigsegg decided in
late 2005 to seek entry to the U.S.
market for reasons related to ongoing
financial viability. The retail price of the
CCX is reported to be over $700,000 per
vehicle.
In a Federal Register document of
April 9, 2007 (72 FR 17608), Koenigsegg
was granted a temporary exemption
from the advanced air bag requirements
of FMVSS No. 208, Occupant Crash
Protection, and from certain provisions
of FMVSS No. 108, Lamps, Reflective
Devices, and Associated Equipment for
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the CCX. The exemption was granted for
the period from April 9, 2007 (the date
of Federal Register publication of the
grant of Koenigsegg’s petition) through
December 31, 2009. In accordance with
49 CFR part 555, the basis for the grant
was that compliance would cause
substantial economic hardship to a
manufacturer that has tried in good faith
to comply with the standard, and the
exemption would have a negligible
impact on motor vehicle safety.
In a submission dated October 29,
2009, Koenigsegg petitioned for a partial
renewal of its temporary exemption,
seeking a temporary exemption from the
advanced air bag requirements only for
the CCX. Koenigsegg did not seek
renewal of the exemption from FMVSS
No. 108 requirements. Koenigsegg
sought a renewal of temporary
exemption from the advanced air bag
requirements for the CCX for an
additional three years, from January 1,
2010 through December 31, 2012.
As discussed in further detail below,
the petitioner argued that it tried in
good faith, but could not bring the
vehicle into compliance with the
advanced air bag requirements, and
would incur substantial economic
hardship if it cannot sell continue to sell
vehicles in the U.S.
Eligibility. Koenigsegg is a small,
privately-owned company with at
present, 40 full-time staff members and
several part-time employees. Koenigsegg
advises NHTSA that it is not affiliated
with any other automobile
manufacturer. At the time Koenigsegg
submitted its petition to NHTSA,
Koenigsegg was negotiating to purchase
SAAB Automobile, but SAAB was not
sold to Koenigsegg.
The company is a small volume
manufacturer whose total production
has been between four and eight
vehicles per year for the past four years.
According to profit and loss accounts
provided by Koenigsegg, the company
has experienced losses in calendar year
(CY) 2006 of $3,771,571,10 losses in CY
2007 of $3,673,124, and losses in CY
2008 of $274,255. In CY 2009,
Koenigsegg reported a profit of
$178,281.
Since it was granted the exemption
from advanced air bags in 2007,
Koenigsegg stated that worldwide
economic conditions required a reevaluation of its business and sales
projections. Koenigsegg’s earlier plan to
manufacture as many as 50 vehicles per
year has been adjusted to approximately
20 vehicles per year. Recently,
Koenigsegg has initiated a ‘‘Custom
10 All dollar amounts cited are based on an
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Vision’’ program that allows customers a
measure of customization (within
vehicle specification boundaries) of
their vehicles. This initiative has
increased the costs of building the
vehicles and resulted in an increase in
the retail sales price of each vehicle.11
As an additional source of income,
Koenigsegg has been able to sell its
engineering services to third parties and
cites the ‘‘Quant concept car’’ 12 as one
project.
According to forecasts presented in its
petition, Koenigsegg anticipates the
following number of CCX vehicles
would be imported into the United
States, if its requested renewal of
exemption were to be granted: 10 CCXs
in CY 2010; 12 CCXs in CY 2011, and
17 CCXs in CY 2012.
Requested Exemptions. Koenigsegg
stated that it intends to certify the CCX
as complying with the rigid barrier
belted test requirement using the 50th
percentile adult male test dummy set
forth in S14.5.1 of FMVSS No. 208. The
petitioner stated that it previously
determined the CCX’s compliance with
rigid barrier unbelted test requirements
using the 50th percentile adult male test
dummy through the S13 sled test using
a generic pulse rather than a full vehicle
test. Koenigsegg stated that it, therefore,
cannot at present say with certainty that
the CCX will comply with the unbelted
test requirement under S14.5.2, which is
a 20–25 mph rigid barrier test. As for the
CCX’s compliance with the other
advanced air bag requirements,
Koenigsegg stated that it does not know
whether the CCX will be compliant
because to date it has not had the
financial ability to conduct the
necessary testing. As such, Koenigsegg
is requesting an exemption for the CCX
from the rigid barrier unbelted test
requirement with the 50th percentile
adult male test dummy (S14.5.2), the
rigid barrier test requirement using the
5th percentile adult female test dummy
(belted and unbelted, S15), the offset
deformable barrier test requirement
using the 5th percentile adult female
test dummy (S17), the requirements to
provide protection for infants and
children (S19, S21, and S23) and the
requirement using an out-of-position 5th
11 Koenigsegg did not specify the amount of the
increase in price.
12 In footnote 1 in its petition, Koenigsegg
describes the ‘‘Quant concept car’’ as follows: ‘‘The
Quant project was a commission from NLG, a Swiss
high tech company specializing in the development
of new patented solar cell and rechargeable battery
technologies, who wanted a high profile concept car
to showcase their technologies. Koenigsegg was
responsible for the vehicle concept, styling and
showcar manufacturing and painting, show ready
* * *’’
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percentile adult female test dummy at
the driver position (S25).
Koenigsegg’s Statement of Economic
Hardship—Publicly available
information and financial documents
submitted to NHTSA by the petitioner
indicate that sales of the CCX will result
in greater financial losses unless
Koenigsegg obtains renewal of the
temporary exemption from the
advanced air bag requirements.
Koenigsegg states that the U.S.
accounts for approximately 35 to 40
percent of the worldwide market for the
CCX. Koenigsegg states that for CY 2006
through 2008, its financial statements
have shown losses of over $7.7 million
dollars.13
Koenigsegg states that if the renewal
of the temporary exemption from
advanced air bag requirements is not
granted, there will be losses over CYs
2009–2011 of more than $3.3 million.14
With a renewal of the temporary
exemption from advanced air bag
requirements, Koenigsegg forecasts
profits of $3.6 million for CYs 2010
through 2012.15
Koenigsegg states that without the
renewal of the temporary exemption,
the CCX cannot be sold in the U.S. from
CY 2010 through 2012, and it needs the
income from U.S. sales until the next
version of the CCX is produced in 2013
with advanced air bags. Koenigsegg
asserts that the financial impact of a
denial of renewal of the temporary
exemption would be more than lost
sales. Koenigsegg’s view is that with no
U.S. sales for a three year period, it will
‘‘surrender’’ its small, but, in
Koenigsegg’s view, ‘‘significant’’ market
share to competitors, and expressed
concern that it will not be able to regain
that lost market share. Furthermore,
because the CYs 2010 through 2012 U.S.
sales of the CCX are expected to make
up half of worldwide sales of the CCX,
Koenigsegg stated it is ‘‘likely’’ that it
would no longer be viable for
Koenigsegg to continue to produce the
CCX for any market.
13 All dollar amounts cited are based on an
exchange rate of 6.8 krona to the U.S. dollar.
14 Koenigsegg states it will make a profit of
$178,281 in CY 2009 (the last year of the temporary
exemption from advanced air bag and FMVSS No.
108 requirements), and without a renewal of the
temporary exemption from advanced air bag
requirements, forecasts that it will incur a loss of
$2,607,200 in CY 2010, and that it will incur a loss
of $704,785 in CY 2011.
15 With a renewal of the temporary exemption
from advanced air bag requirements, Koenigsegg
forecasts that it will make a profit of $6,636
(assuming U.S. sales of 10 CCX vehicles) in CY
2010, make a profit of $1,131,449 (assuming U.S.
sales of 12 CCX vehicles) in CY 2011, and will make
a profit of $2,493,698 (assuming U.S. sales of 17
CCX vehicles) in CY 2012.
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Koenigsegg’s Statement of Good Faith
Efforts to Comply With Advanced Air
Bag Requirements—Koenigsegg
provided the following information in
support of its statement that it has made
the requisite good faith efforts to meet
advanced air bag requirements. In its
initial petition for temporary exemption
from advanced air bag requirements,
Koenigsegg anticipated ‘‘that two years
would be needed to install an advanced
air bag system on the CCX.’’ 16 At that
time, Koenigsegg planned to produce a
second generation of the CCX model by
late 2009, which would be certified as
complying with all applicable U.S.
standards, including those for advanced
air bags.
However, Koenigsegg is facing
unanticipated financial challenges.
Since it was granted the temporary
exemption from advanced air bag
requirements in April 2007, Koenigsegg
cited ‘‘unexpected events’’ that have
necessitated the product cycle of the
CCX to be extended from December
2009 to December 2012. The
introduction of the successor vehicle to
the CCX has been delayed for three
years because Koenigsegg has used
available funds to comply with the
California Air Resources Board (CARB)
requirements for the U.S. market. The
world economic situation has hindered
Koenigsegg’s search for outside
financing to develop the new model.
Koenigsegg stated that: ‘‘The limited
funds available are felt to be better
utilized on improving the CCX with
regards to 35 mph occupant protection.’’
Koenigsegg stated that expenditures
also went to meeting U.S. and European
carbon dioxide emissions requirements
and FMVSS No. 108 headlamp
requirements.
In 2009, when it realized the
successor vehicle to the CCX was going
to be delayed, Koenigsegg once again
looked into the possibility of fitting
advanced air bags into the current CCX.
Koenigsegg had hoped that
technological and supplier availability
had changed since it made its last
review in 2005. After its 2009 review,
Koenigsegg concluded that advanced air
bags for the current CCX were not
available.
Nevertheless, there has been some
progress in developing advanced air
bags for the CCX. Koenigsegg states that
it has undertaken significant work and
through many iterations of crash
analysis simulation, now understands
the extent of redesign. Koenigsegg states
that complete compliance with FMVSS
No. 208 is hindered by the number of
crash test vehicles needed to validate all
16 72
FR 17608, at 17611, April 9, 2007.
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the test cases. Koenigsegg states that in
adopting the new development plan, it
would take three vehicles and 10 full
front end assemblies, at a cost to
Koenigsegg of $4.5 million. Koenigsegg
states that at present, this amount of
money is neither financially or
commercially feasible.
Koenigsegg explained how it has
focused on developing advanced air
bags for the CCX successor vehicle.
Koenigsegg has started working with a
consortium consisting of IDIADA,
Bosch, and Key Safety Systems, to
develop a ‘‘low risk’’ advanced air bag
development program that would be
feasible for a small volume
manufacturer to complete. This effort is
primarily based on a drastic reduction
in the number of test vehicles, and is
based on continued rebuild and repair
of frontal structures that are bolted on
to the vehicle. Koenigsegg stated that
this was possible because of the
‘‘advanced monococque chassis
concept’’ upon which the CCX successor
will be based. Koenigsegg further stated
that the successor to the CCX will
comply with the FMVSS No. 214 Side
Impact Protection pole test criteria.
Koenigsegg described how the work
initiated for the advanced air bag
program will be shared: Koenigsegg will
take overall vehicle engineering
responsibility; IDIADA will perform all
CAE (computer aided engineering) and
manage the crash test program; Bosch
will be responsible for the air bag ECU
(electronic control unit) hardware/
software development; and Key Safety
Systems (KSS) will be responsible for
the DAB (driver side air bag)/PAB
(passenger side air bag) and restraint
system hardware adaptation and
calibration, including all sled tests.
Koenigsegg’s plan is to spend over
$1.3 million in outside development
costs plus $2.8 million for the cost of
development vehicles. Because of the
worldwide economic situation, which
has affected automotive sales,
Koenigsegg states that it needs more
time to be able to raise the capital to
meet the advanced air bag development
expenditures.
Koenigsegg Argues an Exemption
Would Be in the Public Interest. The
petitioner put forth several arguments in
favor of a finding that the requested
renewal of an exemption from advanced
air bag requirements would be
consistent with the public interest.
Specifically, Koenigsegg argued that the
vehicle would be equipped with a fullycompliant standard U.S. air bag system.
Other than the lack of an advanced air
bag, Koenigsegg emphasized that the
CCX will comply with applicable
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FMVSSs and with Part 581, Bumper
Standard.
As additional bases for showing that
its requested renewal of an exemption
would be in the public interest,
Koenigsegg offered the following. The
company asserted that there is
consumer demand in the U.S. for the
CCX, and granting this application will
allow the demand to be met, thereby
expanding consumer choice. The
company also suggested another reason
why granting the renewal of the
exemption would not be expected to
have a significant impact on safety,
specifically because the vehicle is
unlikely to be used extensively by
owners, due to its ‘‘sporty (second car)
nature.’’ Finally, Koenigsegg indicated
that the CCX incorporates advanced
engineering and certain advanced safety
features that are not required by the
FMVSSs, including racing brakes with
anti-lock capability and traction control.
In addition, the company argued that
the CCX has enhanced fuel efficiency
due to its highly aerodynamic design.
IV. Petition of Morgan
Background—Founded in 1909,
Morgan is a small, privately-owned
vehicle manufacturer producing
approximately 650 specialty sports cars
per year.17 Morgan manufactures several
models, but at present, only sells the
Aero 8 in the U.S. Morgan intended to
produce a vehicle line specific to the
U.S. market, with Ford supplying the
engine and transmission. However, for
technical reasons, the project did not
come to fruition, and Morgan
temporarily stopped selling vehicles in
the U.S. in 2004. In May 2005, Morgan
obtained a temporary exemption from
this agency’s bumper standard and
began selling the Aero 8 in the U.S.
On July 12, 2006 (71 FR 39386),
NHTSA published a notice of receipt of
five applications for temporary
exemptions from the advanced air bag
requirements of FMVSS No. 208.
Among these petitions was one from
Morgan, for the Aero 8, which is
discussed at pages 39390–39391.
Morgan’s petition is included in the
docket for that notice, i.e., Docket
NHTSA–2006–25324.
We granted Morgan’s petition for
temporary exemption in a Federal
Register notice of September 7, 2006 (71
FR 52851). The discussion of Morgan’s
grant is on pages 52862 though 52865.
The grant of temporary exemption is for
the Morgan Aero 8 ‘‘From S15.2, S17,
17 A manufacturer is eligible to apply for a
hardship exemption if its total motor vehicle
production in its most recent year of production
does not exceed 10,000, as determined by the
NHTSA Administrator (15 U.S.C. 1410(d)(1)).
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20086
Federal Register / Vol. 76, No. 69 / Monday, April 11, 2011 / Notices
S19, S21, S23, and S25 of 49 CFR
571.208.’’ The exemption was granted
for the period from September 1, 2006
to August 31, 2009.
In a petition dated June 11, 2009,
Morgan asked for a renewal of the
temporary exemption for a two year
period, from September 1, 2009 to
August 31, 2011. NHTSA’s statute at 49
U.S.C. 30113(b) states that exemptions
from a Federal motor vehicle safety
standard are to be granted on a
‘‘temporary basis.’’ 18 However, the
statute also expressly provides for
renewal of an exemption on
reapplication.
Morgan’s petition would apply to the
Aero 8 and the Aero Super Sport, an
interim vehicle also based on the Aero
platform. The Aero Super Sport will be
available on an interim basis until a
successor vehicle (code named the
AP8), is complete and ready for sale.
Morgan’s Statement of Economic
Hardship—In its petition for temporary
exemption for the Aero 8 for September
1, 2006 through August 31, 2009,
Morgan estimated that U.S. sales of the
Aero 8 would be several hundred
vehicles a year. In the June 11, 2009
petition, Morgan reports that it has sold
19 Aero 8s in the U.S. from September
2006 to the present. The 19 vehicles
represent ‘‘less than 3% of what had
been expected.’’
Morgan stated it has been focusing
over the last two years on the Aero
model range successor, (code named the
AP8) which will be a completely new
design. However, since the original
petition was granted in 2006, it was
decided to extend the availability of the
present Aero model from September
2009 to the fall of 2011, in large part due
to world economic conditions.
Because, over the past few years,
Morgan did not sell as many vehicles in
the U.S. as it had hoped, and because of
other economic considerations, Morgan
decided to delay development of the
new AP8. In order to ‘‘improve available
funds,’’ Morgan decided to concentrate
on the Aero Super Sport, an interim
project based on the Aero platform,
which Morgan hopes will be able to
generate enough revenue so that Morgan
can continue to develop the AP8. The
Aero Super Sport was slated to be
available in the U.S. in January 2010.
Morgan seeks an extension of the
temporary exemption from the
advanced air bag requirements for the
Aero Super Sport. Morgan intends to
use the exemption to cover a ‘‘limited
production run of 50 U.S. Aero Super
Sport cars.’’ Morgan states the Aero
Super Sport will be the last model that
18 49
U.S.C. 30113(b)(1).
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17:49 Apr 08, 2011
Jkt 223001
is based on the Aero chassis and that
uses the standard air bag system.
Morgan states that the Aero ‘‘must’’
come to an end in 2011 because the
production of the steering wheel has
ended, and no further stock, other than
that already owned by Morgan, is
available. Morgan stated that this
essentially forced end to production is
important because ‘‘it essentially
precludes further requests by Morgan to
NHTSA to prolong the Aero platform in
the U.S.’’
Morgan estimates that, assuming 50
Aero Super Sports are sold in the U.S.,
the total number of exempted vehicles
that Morgan manufactures and sells in
the U.S. will be 69 (50 Aero Super
Sports plus the 19 Aero 8s already sold).
If Morgan can sell 69 vehicles, that will
be 656 fewer vehicles than the projected
sales in Morgan’s first petition for
temporary exemption in 2005.
Morgan’s Statement of Good Faith
Efforts to Comply—In its previous
submission, Morgan stated that it has
been working with the air bag supplier
Siemens to develop an advanced air bag
system for the Aero 8. However, a lack
of funds and technical problems
precluded the implementation of an
advanced air bag system for the Aero 8.
It said that the minimum time needed
to develop an advanced air bag system
(provided that there is a source of
revenue) is two years. Specific technical
challenges include the following.
Morgan does not have access to the
necessary sensor technology to pursue
the ‘‘full suppression’’ passenger air bag
option. Due to the design of the Aero 8
platform dashboard, an entirely new
interior solution and design must be
developed. Chassis modifications are
anticipated due to the originally stiff
chassis design.
In its February 2006 petition, Morgan
stated that for vehicles to be built
between September 2006–September
2009, the Aero 8 vehicles will have (and
in fact, did have) standard air bags. Back
then, Morgan stated its belief that when
its advanced air bag system is ready in
2009, the air bag system will
simultaneously be installed in both the
Aero and other models.
Morgan’s Statement of Public
Interest—In its original petition
concerning the Aero, Morgan put forth
several arguments supporting its view
that the requested exemption is
consistent with the public interest.
According to Morgan, if the exemption
was denied and Morgan stops U.S. sales,
Morgan’s U.S. dealers would
unavoidably have numerous lay-offs,
resulting in U.S. unemployment. Denial
of an exemption would reduce
consumer choice in the specialty sports
PO 00000
Frm 00136
Fmt 4703
Sfmt 4703
car market sector in which Morgan cars
compete. That company argued that the
Morgan vehicles will not be used
extensively by owners, and are unlikely
to carry small children. Finally,
according to Morgan, granting an
exemption would assure the continued
availability of proper parts and service
support for existing Morgan owners.
Without an exemption, Morgan would
be forced from the U.S. market, and
Morgan dealers would find it difficult to
support existing customers.
In its petition asking for a renewal of
the temporary exemption from FMVSS
No. 208, Morgan reiterated these points.
V. Public Comment Period
We are providing a 30-day comment
period on Koenigsegg’s and Morgan’s
petitions for an extension of a temporary
exemption from the advanced air bag
requirement of FMVSS No. 208. After
considering public comments and other
available information, we will publish a
notice of final action addressing each
application in the Federal Register.
VI. Public Participation
How do I prepare and submit
comments?
Your comments must be written and
in English. To ensure that your
comments are correctly filed in the
Docket, please include the docket
number of this document in your
comments.
Your comments must not be more
than 15 pages long. (49 CFR 553.21). We
established this limit to encourage you
to write your primary comments in a
concise fashion. However, you may
attach necessary additional documents
to your comments. There is no limit on
the length of the attachments.
Please submit two copies of your
comments, including the attachments,
to the Docket at the address given above
under ADDRESSES.
Comments may also be submitted to
the docket electronically by logging into
https://www.regulations.gov. Follow the
online instructions for submitting
comments.
Please note that pursuant to the Data
Quality Act, in order for substantive
data to be relied upon and used by the
agency, it must meet the information
quality standards set forth in the OMB
and DOT Data Quality Act guidelines.
Accordingly, we encourage you to
consult the guidelines in preparing your
comments. OMB’s guidelines may be
accessed at https://www.whitehouse.gov/
omb/fedreg/reproducible.html.
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Federal Register / Vol. 76, No. 69 / Monday, April 11, 2011 / Notices
How can I be sure that my comments
were received?
If you wish Docket Management to
notify you upon its receipt of your
comments, enclose a self-addressed,
stamped postcard in the envelope
containing your comments. Upon
receiving your comments, Docket
Management will return the postcard by
mail.
How do I submit confidential business
information?
If you wish to submit any information
under a claim of confidentiality, you
should submit three copies of your
complete submission, including the
information you claim to be confidential
business information, to the Chief
Counsel, NHTSA, at the address given
above under FOR FURTHER INFORMATION
CONTACT. In addition, you should
submit two copies, from which you
have deleted the claimed confidential
business information, to Docket
Management at the address given above
under ADDRESSES. When you send a
comment containing information
claimed to be confidential business
information, you should include a cover
letter setting forth the information
specified in our confidential business
information regulation. (49 CFR part
512.)
srobinson on DSKHWCL6B1PROD with NOTICES
Will the agency consider late
comments?
We will consider all comments that
Docket Management receives before the
close of business on the comment
closing date indicated above under
DATES. To the extent possible, we will
also consider comments that Docket
Management receives after that date. If
Docket Management receives a comment
too late for us to consider in developing
a final rule (assuming that one is
issued), we will consider that comment
as an informal suggestion for future
rulemaking action.
How can I read the comments submitted
by other people?
You may read the comments received
by Docket Management at the address
given above under ADDRESSES. The
hours of the Docket are indicated above
in the same location. You may also see
the comments on the Internet. To read
the comments on the Internet, go to
https://www.regulations.gov. Follow the
online instructions for accessing the
dockets.
Please note that even after the
comment closing date, we will continue
to file relevant information in the
Docket as it becomes available. Further,
some people may submit late comments.
Accordingly, we recommend that you
VerDate Mar<15>2010
17:49 Apr 08, 2011
Jkt 223001
periodically check the Docket for new
material.
Authority: 49 U.S.C. 30113; delegations of
authority at 49 CFR 1.50. and 501.8.
Issued on: April 5, 2011.
Joseph S. Carra,
Acting Associate Administrator for
Rulemaking.
[FR Doc. 2011–8468 Filed 4–8–11; 8:45 am]
BILLING CODE 4910–59–P
DEPARTMENT OF TRANSPORTATION
Surface Transportation Board
[Docket No. AB 55 (Sub-No. 705X)]
CSX Transportation, Inc.—
Discontinuance of Service
Exemption—in Pinellas County, Fla.
CSX Transportation, Inc. (CSXT) filed
a verified notice of exemption under 49
CFR part 1152 subpart F—Exempt
Abandonments and Discontinuances of
Service to discontinue service over
approximately a 0.45-mile rail line on
CSXT’s Southern Region, Jacksonville
Division, Clearwater Subdivision,
extending between milepost ARE 897.55
near 16th Street North and milepost
ARE 898.00 at the junction of 1st
Avenue South and Dr. Martin Luther
King Street in St. Petersburg, Pinellas
County, Fla. The line traverses United
States Postal Service Zip Code 33707.
CSXT has certified that: (1) No local
traffic has moved over the line for at
least 2 years; (2) there is no overhead
traffic to be rerouted over other lines; (3)
no formal complaint filed by a user of
rail service on the line (or by a state or
local government entity acting on behalf
of such user) regarding cessation of
service over the line either is pending
with the Surface Transportation Board
or with any U.S. District Court or has
been decided in favor of complainant
within the 2-year period; and (4) the
requirements at 49 CFR 1105.12
(newspaper publication) and 49 CFR
1152.50(d)(1) (notice to governmental
agencies) have been met.
As a condition to this exemption, any
employee adversely affected by the
discontinuance of service shall be
protected under Oregon Short Line
Railroad—Abandonment Portion
Goshen Branch Between Firth &
Ammon, in Bingham & Bonneville
Counties, Idaho, 360 I.C.C. 91 (1979). To
address whether this condition
adequately protects affected employees,
a petition for partial revocation under
49 U.S.C. § 10502(d) must be filed.
Provided no formal expression of
intent to file an offer of financial
assistance (OFA) has been received, this
PO 00000
Frm 00137
Fmt 4703
Sfmt 4703
20087
exemption will be effective on May 11,
2011, unless stayed pending
reconsideration. Petitions to stay that do
not involve environmental issues and
formal expressions of intent to file an
OFA for continued rail service under 49
CFR 1152.27(c)(2) 1 must be filed by
April 21, 2011.2 Petitions to reopen
must be filed by May 2, 2011, with the
Surface Transportation Board, 395 E
Street, SW., Washington, DC 20423–
0001.
A copy of any petition filed with the
Board should be sent to CSXT’s
representative: Louis E. Gitomer, Law
Offices of Louis E. Gitomer, LLC, 600
Baltimore Avenue, Suite 301, Towson,
MD 21204.
If the verified notice contains false or
misleading information, the exemption
is void ab initio.
Board decisions and notices are
available on our Web site at https://
www.stb.dot.gov.
Decided: April 1, 2011.
By the Board, Rachel D. Campbell,
Director, Office of Proceedings.
Jeffrey Herzig,
Clearance Clerk.
[FR Doc. 2011–8439 Filed 4–8–11; 8:45 am]
BILLING CODE 4915–01–P
DEPARTMENT OF THE TREASURY
Proposed Collection; Comment
Request; State Small Business Credit
Initiative Allocation Agreement
Departmental Offices, Small
Business Lending Funds, Treasury.
ACTION: Notice and request for
comments.
AGENCY:
In accordance with the
Paperwork Reduction Act of 1995,
Public Law 104–13 (44 U.S.C.
3506(c)(2)(A)), this notice invites the
general public and other public agencies
to comment on a proposed information
collection for which approval from the
Office of Management and Budget
(OMB) will be requested. The proposed
collection would be an extension of a
currently approved collection under
OMB No. 1505–0227 which is due to
expire June 30, 2011.
DATES: Written comments must be
received on or before June 10, 2011 to
be assured of consideration.
SUMMARY:
1 Each OFA must be accompanied by the filing
fee, which is currently set at $1,500. See 49 CFR
1002.2(f)(25).
2 Because this is a discontinuance proceeding and
not an abandonment, trail use/rail banking and
public use conditions are not appropriate. Likewise,
no environmental or historic documentation is
required here under 49 CFR 1105.6(c) and 49 CFR
1105.8(b), respectively.
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]]>Agencies
[Federal Register Volume 76, Number 69 (Monday, April 11, 2011)]
[Notices]
[Pages 20082-20087]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2011-8468]
-----------------------------------------------------------------------
DEPARTMENT OF TRANSPORTATION
National Highway Traffic Safety Administration
[Docket No. NHTSA-2011-0006]
Koenigsegg Automotive AB; Morgan Motor Company Limited; Receipt
of Applications for Renewals of Temporary Exemptions From the Advanced
Air Bag Requirements of FMVSS No. 208
AGENCY: National Highway Traffic Safety Administration (NHTSA),
Department of Transportation (DOT).
ACTION: Notice of receipt of applications for renewals of temporary
exemptions and request for comments.
-----------------------------------------------------------------------
SUMMARY: In accordance with the procedures in 49 CFR Part 555,
Koenigsegg Automotive AB Koenigsegg'') and Morgan Motor Company Limited
(``Morgan'') have petitioned the agency for renewals of temporary
exemption from advanced air bag requirements of FMVSS No. 208,
``Occupant crash protection.''The basis for each application is that
compliance would cause substantial economic hardship to a manufacturer
that has tried in good faith to comply with the standard.
This notice of receipt of applications for renewal of temporary
exemptions is published in accordance with the statutory provisions of
49 U.S.C. 30113(b)(2). Please note that we are publishing together the
notice of receipt of the two applications for renewal to ensure
efficient use of agency resources and to facilitate processing of the
applications. NHTSA has made no judgments on the merits of each
application. NHTSA will consider each application separately. We ask
that commenters also consider each application separately and submit
comments specific to individual applications.
DATES: Comments must be received on or before May 11, 2011.
ADDRESSES: You may submit comments to the docket number identified in
the heading of this document by any of the following methods:
Federal eRulemaking Portal: Go to https://www.regulations.gov. Follow the online instructions for submitting
comments.
Mail: Docket Management Facility, M-30, U.S. Department of
Transportation, West Building, Ground Floor, Rm. W12-140, 1200 New
Jersey Avenue, SE., Washington, DC 20590.
Hand Delivery or Courier: West Building Ground Floor, Room
W12-140, 1200 New Jersey Avenue, SE., between 9 a.m. and 5 p.m. Eastern
Time, Monday through Friday, except Federal holidays.
Fax: (202) 493-2251.
Regardless of how you submit your comments, you should mention the
docket number of this document.
You may call the Docket at 202-366-9324.
Instructions: For detailed instructions on submitting comments and
additional information on the rulemaking process, see the Public
Participation heading of the Supplementary Information section of this
document. Note that all comments received will be posted without change
to https://www.regulations.gov, including any personal information
provided. Please see the Privacy Act discussion below.
Privacy Act: Anyone is able to search the electronic form of all
comments received into any of our dockets by the name of the individual
submitting the comment (or signing the comment, if submitted on behalf
of an association, business, labor union, etc.). You may review DOT's
complete Privacy Act Statement in the Federal Register published on
April 11, 2000 (65 FR 19477-78).
We shall consider all comments received before the close of
business on the comment closing date indicated below. To the extent
possible, we shall also consider comments filed after the closing date.
FOR FURTHER INFORMATION CONTACT: Ms. Dorothy Nakama, Office of the
Chief Counsel, NCC-112, National Highway Traffic Safety Administration,
1200 New Jersey Ave., SE., Washington, DC 20590. Telephone: (202) 366-
2992; Fax: (202) 366-3820.
I. Advanced Air Bag Requirements and Small Volume Manufacturers
In 2000, NHTSA upgraded the requirements for air bags in passenger
cars and light trucks, requiring what are commonly known as ``advanced
air bags.'' \1\ The upgrade was designed to meet the goals of improving
protection for occupants of all sizes, belted and unbelted, in
moderate-to-high-speed crashes, and of minimizing the risks posed by
air bags to infants, children, and other occupants, especially in low-
speed crashes. The rule accomplished this by establishing new test
requirements and injury criteria and specifying the use of an entire
family of test dummies: the then-existing dummy representing 50th
percentile adult males, and new dummies representing 5th percentile
adult females, 6-year-old children, 3-year-old children, and 1-year-old
infants.
---------------------------------------------------------------------------
\1\ See 65 FR 30680 (May 12, 2000) (Docket No. NHTSA-2000-7013).
---------------------------------------------------------------------------
The advanced air bag requirements were a culmination of a
comprehensive plan that the agency announced in 1996 to address the
adverse effects of air bags. This plan also included an extensive
consumer education program to encourage the placement of children in
rear seats.
The new requirements were phased in beginning with the 2004 model
year. Small volume manufacturers (i.e., original vehicle manufacturers
producing or assembling fewer than 5,000 vehicles annually for sale in
the United States) were not subject to the advanced air bag
requirements until September 1, 2006.
In recent years, NHTSA has addressed a number of petitions for
exemption from the advanced air bag requirements of FMVSS No. 208. The
majority of these requests have come from small manufacturers which
have petitioned on the basis of substantial economic hardship to a
manufacturer that has tried in good faith to comply with the standard.
Although NHTSA has granted a number of these petitions in
situations where the manufacturer is supplying standard air bags in
lieu of advanced air bags,\2\ NHTSA is considering (1) whether it is in
the public interest to continue to grant such petitions, particularly
in the same manner as in the past, given the number of years these
requirements have now been in effect and the benefits of advanced air
bags, and (2) to the extent such petitions are granted, what plans and
countermeasures to protect child and infant occupants, short of
compliance with the advanced air bags, should be expected.
---------------------------------------------------------------------------
\2\ See, e.g., grant of petition to Panoz, 72 FR 28759 (May 22,
2007), or grant of petition to Koenigsegg, 72 FR 17608 (April 9,
2007).
---------------------------------------------------------------------------
Given the passage of time since the advanced air bag requirements
were established and have been implemented, and in light of the
benefits of advanced air bags, NHTSA is considering whether it is in
the public interest to continue to grant exemptions from these
requirements, particularly in the same manner as in the past. The costs
of compliance with the advanced air bag requirements of FMVSS No. 208
are costs that all entrants to the U.S. automobile marketplace should
expect to bear. Furthermore, NHTSA understands that, in contrast to the
[[Page 20083]]
initial years after the advanced air bag requirements went into effect,
low volume manufacturers now have access to advanced air bag
technology. Accordingly, NHTSA tentatively concludes that the expense
of advanced air bag technology may not now be sufficient, in and of
itself, to justify the grant of a petition for a hardship exemption
from the advanced air bag requirements.
NHTSA further notes that exemptions from motor vehicle safety
standards are to be granted on a ``temporary basis.'' \3\ In prior
petitions NHTSA has granted temporary exemptions from the advanced air
bag requirements as a means of affording eligible manufacturers a
transition period to comply with the exempted standard. Accordingly, in
deciding whether to grant an exemption based on substantial economic
hardship, NHTSA ordinarily considers the steps that the manufacturer
has already taken to achieve compliance, as well as the future steps
the manufacturer plans to take during the exemption period and the
estimated date by which full compliance will be achieved.\4\
---------------------------------------------------------------------------
\3\ 49 U.S.C. 30113(b)(1).
\4\ 49 CFR 555.6(a)(2).
---------------------------------------------------------------------------
NHTSA invites comment on whether and in what circumstances (e.g.,
nature of vehicles, number of vehicles, level of efforts to comply with
the requirements, timing as to number of years since the requirements
were implemented, etc.) it should continue to grant petitions for
exemptions from the advanced air bag requirements of FMVSS No. 208. We
note that any policy statements we may make in this area would not have
the effect of precluding manufacturers from submitting subsequent
petitions for exemption. However, we believe it could be helpful for
manufacturers to know our general views in advance of submitting a
petition.
We also request comment on the issue of, to the extent such
petitions are granted, what plans and countermeasures to protect child
and infant occupants, short of compliance with the advanced air bags,
should be expected. We note that in responding to some recent petitions
for exemption from the advanced air bag requirements of FMVSS No. 208,
NHTSA has considered the fact that the petitioner planned to install
some countermeasures for the protection of child passengers.\5\
---------------------------------------------------------------------------
\5\ See, e.g., grant of petition of Think Technology AS, 74 FR
40634-01 (Aug. 12, 2009); grant of petition of Ferrari S.p.A., 74 FR
36303-02 (July 22, 2009).
---------------------------------------------------------------------------
NHTSA also invites comment on the likelihood that a child or infant
will be a passenger in either a Morgan or Koenigsegg vehicle sold in
the U.S.
As always, we are concerned about the potential safety implication
of any temporary exemption granted by this agency. In the present case,
we are addressing two petitions that seek renewals of temporary
exemptions from the advanced air bag requirements. Each petitioner is a
manufacturer of low volume, specialty sports cars.
II. Overview of Petitions for Economic Hardship Exemption
In accordance with 49 U.S.C. 30113 and the procedures in 49 CFR
Part 555, Koenigsegg Automotive AB (``Koenigsegg'') and Morgan Motor
Company (``Morgan'') have petitioned the agency for renewals of
temporary exemptions from certain advanced air bag requirements of
FMVSS No. 208 (S14).
The basis for Koenigsegg's application and for Morgan's application
is that compliance would cause substantial economic hardship \6\ to a
manufacturer that has tried in good faith to comply with that standard.
A copy of each petition \7\ is available for review and has been placed
in the docket for this notice. The agency closely examines and
considers the information provided by manufacturers in support of these
factors, and, in addition, pursuant to 49 U.S.C. 30113(b)(3)(A),
determines whether exemption is in the public interest and consistent
with the Safety Act.\8\
---------------------------------------------------------------------------
\6\ When considering financial matters involving companies based
in the European Union (EU), it is important to recognize that EU and
U.S. accounting principles have certain differences in their
treatment of revenue, expenses, and profits. Public statements by EU
manufacturers relating to financial results should be understood in
this context. This agency analyzes claims of financial hardship
carefully and in accordance with U.S. accounting principles.
\7\ Morgan has requested confidential treatment under 49 CFR
Part 512 for certain business and financial information submitted as
part of its petition for temporary exemption. Accordingly, the
information placed in the docket does not contain such information
that the agency has determined to be confidential.
\8\ The Safety Act is codified as Title 49, United States Code,
Chapter 301.
---------------------------------------------------------------------------
A manufacturer is eligible to apply for a hardship exemption if its
total motor vehicle production in its most recent year of production
did not exceed 10,000 vehicles, as determined by the NHTSA
Administrator (49 U.S.C. 30113).
Finally, while 49 U.S.C. 30113(b) states that exemptions from a
Safety Act standard are to be granted on a ``temporary basis,'' \9\ the
statute also expressly provides for renewal of an exemption on
reapplication. Manufacturers are nevertheless cautioned that the
agency's decision to grant an initial petition in no way predetermines
that the agency will repeatedly grant renewal petitions, thereby
imparting semi-permanent exemption from a safety standard. Exempted
manufacturers seeking renewal must bear in mind that the agency is
directed to consider financial hardship as but one factor, along with
the manufacturer's on-going good faith efforts to comply with the
regulation, the public interest, consistency with the Safety Act,
generally, as well as other such matters provided in the statute.
---------------------------------------------------------------------------
\9\ 49 U.S.C 30113(b)(1).
---------------------------------------------------------------------------
We note that under 49 CFR 555.8(e), ``If an application for renewal
of temporary exemption that meets the requirements of Sec. 555.5 has
been filed not later than 60 days before the termination date of an
exemption, the exemption does not terminate until the Administrator
grants or denies the application for renewal.'' In the case of the
petitions for renewal from both Koenigsegg and Morgan, each
manufacturer submitted its petition for renewal by the deadline stated
in 49 CFR 555.8(e).
III. Petition of Koenigsegg
Background--Koenigsegg Automotive is a Swedish corporation formed
in 1999 to produce high-performance sports cars, which are not intended
for daily commuting purposes. Koenigsegg is a privately owned company
with fewer than 100 shareholders, and manufactures fewer than 50 cars
per year. At the time Koenigsegg applied for its initial exemption, the
Koenigsegg product line for U.S. sale consisted of the CC model. The
Koenigsegg CCX was developed as the next generation of Koenigsegg
vehicles after production of the CCR model ended on December 30, 2005.
The CCX model (the subject of Koenigsegg's petitions for temporary
exemption) was scheduled to go into production in 2006 and to continue
at least through the end of 2009. Originally, planning to sell vehicles
only in the European, Mid-East, and Far-East markets, Koenigsegg
decided in late 2005 to seek entry to the U.S. market for reasons
related to ongoing financial viability. The retail price of the CCX is
reported to be over $700,000 per vehicle.
In a Federal Register document of April 9, 2007 (72 FR 17608),
Koenigsegg was granted a temporary exemption from the advanced air bag
requirements of FMVSS No. 208, Occupant Crash Protection, and from
certain provisions of FMVSS No. 108, Lamps, Reflective Devices, and
Associated Equipment for
[[Page 20084]]
the CCX. The exemption was granted for the period from April 9, 2007
(the date of Federal Register publication of the grant of Koenigsegg's
petition) through December 31, 2009. In accordance with 49 CFR part
555, the basis for the grant was that compliance would cause
substantial economic hardship to a manufacturer that has tried in good
faith to comply with the standard, and the exemption would have a
negligible impact on motor vehicle safety.
In a submission dated October 29, 2009, Koenigsegg petitioned for a
partial renewal of its temporary exemption, seeking a temporary
exemption from the advanced air bag requirements only for the CCX.
Koenigsegg did not seek renewal of the exemption from FMVSS No. 108
requirements. Koenigsegg sought a renewal of temporary exemption from
the advanced air bag requirements for the CCX for an additional three
years, from January 1, 2010 through December 31, 2012.
As discussed in further detail below, the petitioner argued that it
tried in good faith, but could not bring the vehicle into compliance
with the advanced air bag requirements, and would incur substantial
economic hardship if it cannot sell continue to sell vehicles in the
U.S.
Eligibility. Koenigsegg is a small, privately-owned company with at
present, 40 full-time staff members and several part-time employees.
Koenigsegg advises NHTSA that it is not affiliated with any other
automobile manufacturer. At the time Koenigsegg submitted its petition
to NHTSA, Koenigsegg was negotiating to purchase SAAB Automobile, but
SAAB was not sold to Koenigsegg.
The company is a small volume manufacturer whose total production
has been between four and eight vehicles per year for the past four
years. According to profit and loss accounts provided by Koenigsegg,
the company has experienced losses in calendar year (CY) 2006 of
$3,771,571,\10\ losses in CY 2007 of $3,673,124, and losses in CY 2008
of $274,255. In CY 2009, Koenigsegg reported a profit of $178,281.
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\10\ All dollar amounts cited are based on an exchange rate of
6.8 krona to the U.S. dollar.
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Since it was granted the exemption from advanced air bags in 2007,
Koenigsegg stated that worldwide economic conditions required a re-
evaluation of its business and sales projections. Koenigsegg's earlier
plan to manufacture as many as 50 vehicles per year has been adjusted
to approximately 20 vehicles per year. Recently, Koenigsegg has
initiated a ``Custom Vision'' program that allows customers a measure
of customization (within vehicle specification boundaries) of their
vehicles. This initiative has increased the costs of building the
vehicles and resulted in an increase in the retail sales price of each
vehicle.\11\
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\11\ Koenigsegg did not specify the amount of the increase in
price.
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As an additional source of income, Koenigsegg has been able to sell
its engineering services to third parties and cites the ``Quant concept
car'' \12\ as one project.
---------------------------------------------------------------------------
\12\ In footnote 1 in its petition, Koenigsegg describes the
``Quant concept car'' as follows: ``The Quant project was a
commission from NLG, a Swiss high tech company specializing in the
development of new patented solar cell and rechargeable battery
technologies, who wanted a high profile concept car to showcase
their technologies. Koenigsegg was responsible for the vehicle
concept, styling and showcar manufacturing and painting, show ready
* * *''
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According to forecasts presented in its petition, Koenigsegg
anticipates the following number of CCX vehicles would be imported into
the United States, if its requested renewal of exemption were to be
granted: 10 CCXs in CY 2010; 12 CCXs in CY 2011, and 17 CCXs in CY
2012.
Requested Exemptions. Koenigsegg stated that it intends to certify
the CCX as complying with the rigid barrier belted test requirement
using the 50th percentile adult male test dummy set forth in S14.5.1 of
FMVSS No. 208. The petitioner stated that it previously determined the
CCX's compliance with rigid barrier unbelted test requirements using
the 50th percentile adult male test dummy through the S13 sled test
using a generic pulse rather than a full vehicle test. Koenigsegg
stated that it, therefore, cannot at present say with certainty that
the CCX will comply with the unbelted test requirement under S14.5.2,
which is a 20-25 mph rigid barrier test. As for the CCX's compliance
with the other advanced air bag requirements, Koenigsegg stated that it
does not know whether the CCX will be compliant because to date it has
not had the financial ability to conduct the necessary testing. As
such, Koenigsegg is requesting an exemption for the CCX from the rigid
barrier unbelted test requirement with the 50th percentile adult male
test dummy (S14.5.2), the rigid barrier test requirement using the 5th
percentile adult female test dummy (belted and unbelted, S15), the
offset deformable barrier test requirement using the 5th percentile
adult female test dummy (S17), the requirements to provide protection
for infants and children (S19, S21, and S23) and the requirement using
an out-of-position 5th percentile adult female test dummy at the driver
position (S25).
Koenigsegg's Statement of Economic Hardship--Publicly available
information and financial documents submitted to NHTSA by the
petitioner indicate that sales of the CCX will result in greater
financial losses unless Koenigsegg obtains renewal of the temporary
exemption from the advanced air bag requirements.
Koenigsegg states that the U.S. accounts for approximately 35 to 40
percent of the worldwide market for the CCX. Koenigsegg states that for
CY 2006 through 2008, its financial statements have shown losses of
over $7.7 million dollars.\13\
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\13\ All dollar amounts cited are based on an exchange rate of
6.8 krona to the U.S. dollar.
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Koenigsegg states that if the renewal of the temporary exemption
from advanced air bag requirements is not granted, there will be losses
over CYs 2009-2011 of more than $3.3 million.\14\
---------------------------------------------------------------------------
\14\ Koenigsegg states it will make a profit of $178,281 in CY
2009 (the last year of the temporary exemption from advanced air bag
and FMVSS No. 108 requirements), and without a renewal of the
temporary exemption from advanced air bag requirements, forecasts
that it will incur a loss of $2,607,200 in CY 2010, and that it will
incur a loss of $704,785 in CY 2011.
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With a renewal of the temporary exemption from advanced air bag
requirements, Koenigsegg forecasts profits of $3.6 million for CYs 2010
through 2012.\15\
---------------------------------------------------------------------------
\15\ With a renewal of the temporary exemption from advanced air
bag requirements, Koenigsegg forecasts that it will make a profit of
$6,636 (assuming U.S. sales of 10 CCX vehicles) in CY 2010, make a
profit of $1,131,449 (assuming U.S. sales of 12 CCX vehicles) in CY
2011, and will make a profit of $2,493,698 (assuming U.S. sales of
17 CCX vehicles) in CY 2012.
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Koenigsegg states that without the renewal of the temporary
exemption, the CCX cannot be sold in the U.S. from CY 2010 through
2012, and it needs the income from U.S. sales until the next version of
the CCX is produced in 2013 with advanced air bags. Koenigsegg asserts
that the financial impact of a denial of renewal of the temporary
exemption would be more than lost sales. Koenigsegg's view is that with
no U.S. sales for a three year period, it will ``surrender'' its small,
but, in Koenigsegg's view, ``significant'' market share to competitors,
and expressed concern that it will not be able to regain that lost
market share. Furthermore, because the CYs 2010 through 2012 U.S. sales
of the CCX are expected to make up half of worldwide sales of the CCX,
Koenigsegg stated it is ``likely'' that it would no longer be viable
for Koenigsegg to continue to produce the CCX for any market.
[[Page 20085]]
Koenigsegg's Statement of Good Faith Efforts to Comply With
Advanced Air Bag Requirements--Koenigsegg provided the following
information in support of its statement that it has made the requisite
good faith efforts to meet advanced air bag requirements. In its
initial petition for temporary exemption from advanced air bag
requirements, Koenigsegg anticipated ``that two years would be needed
to install an advanced air bag system on the CCX.'' \16\ At that time,
Koenigsegg planned to produce a second generation of the CCX model by
late 2009, which would be certified as complying with all applicable
U.S. standards, including those for advanced air bags.
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\16\ 72 FR 17608, at 17611, April 9, 2007.
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However, Koenigsegg is facing unanticipated financial challenges.
Since it was granted the temporary exemption from advanced air bag
requirements in April 2007, Koenigsegg cited ``unexpected events'' that
have necessitated the product cycle of the CCX to be extended from
December 2009 to December 2012. The introduction of the successor
vehicle to the CCX has been delayed for three years because Koenigsegg
has used available funds to comply with the California Air Resources
Board (CARB) requirements for the U.S. market. The world economic
situation has hindered Koenigsegg's search for outside financing to
develop the new model. Koenigsegg stated that: ``The limited funds
available are felt to be better utilized on improving the CCX with
regards to 35 mph occupant protection.''
Koenigsegg stated that expenditures also went to meeting U.S. and
European carbon dioxide emissions requirements and FMVSS No. 108
headlamp requirements.
In 2009, when it realized the successor vehicle to the CCX was
going to be delayed, Koenigsegg once again looked into the possibility
of fitting advanced air bags into the current CCX. Koenigsegg had hoped
that technological and supplier availability had changed since it made
its last review in 2005. After its 2009 review, Koenigsegg concluded
that advanced air bags for the current CCX were not available.
Nevertheless, there has been some progress in developing advanced
air bags for the CCX. Koenigsegg states that it has undertaken
significant work and through many iterations of crash analysis
simulation, now understands the extent of redesign. Koenigsegg states
that complete compliance with FMVSS No. 208 is hindered by the number
of crash test vehicles needed to validate all the test cases.
Koenigsegg states that in adopting the new development plan, it would
take three vehicles and 10 full front end assemblies, at a cost to
Koenigsegg of $4.5 million. Koenigsegg states that at present, this
amount of money is neither financially or commercially feasible.
Koenigsegg explained how it has focused on developing advanced air
bags for the CCX successor vehicle. Koenigsegg has started working with
a consortium consisting of IDIADA, Bosch, and Key Safety Systems, to
develop a ``low risk'' advanced air bag development program that would
be feasible for a small volume manufacturer to complete. This effort is
primarily based on a drastic reduction in the number of test vehicles,
and is based on continued rebuild and repair of frontal structures that
are bolted on to the vehicle. Koenigsegg stated that this was possible
because of the ``advanced monococque chassis concept'' upon which the
CCX successor will be based. Koenigsegg further stated that the
successor to the CCX will comply with the FMVSS No. 214 Side Impact
Protection pole test criteria.
Koenigsegg described how the work initiated for the advanced air
bag program will be shared: Koenigsegg will take overall vehicle
engineering responsibility; IDIADA will perform all CAE (computer aided
engineering) and manage the crash test program; Bosch will be
responsible for the air bag ECU (electronic control unit) hardware/
software development; and Key Safety Systems (KSS) will be responsible
for the DAB (driver side air bag)/PAB (passenger side air bag) and
restraint system hardware adaptation and calibration, including all
sled tests.
Koenigsegg's plan is to spend over $1.3 million in outside
development costs plus $2.8 million for the cost of development
vehicles. Because of the worldwide economic situation, which has
affected automotive sales, Koenigsegg states that it needs more time to
be able to raise the capital to meet the advanced air bag development
expenditures.
Koenigsegg Argues an Exemption Would Be in the Public Interest. The
petitioner put forth several arguments in favor of a finding that the
requested renewal of an exemption from advanced air bag requirements
would be consistent with the public interest. Specifically, Koenigsegg
argued that the vehicle would be equipped with a fully-compliant
standard U.S. air bag system. Other than the lack of an advanced air
bag, Koenigsegg emphasized that the CCX will comply with applicable
FMVSSs and with Part 581, Bumper Standard.
As additional bases for showing that its requested renewal of an
exemption would be in the public interest, Koenigsegg offered the
following. The company asserted that there is consumer demand in the
U.S. for the CCX, and granting this application will allow the demand
to be met, thereby expanding consumer choice. The company also
suggested another reason why granting the renewal of the exemption
would not be expected to have a significant impact on safety,
specifically because the vehicle is unlikely to be used extensively by
owners, due to its ``sporty (second car) nature.'' Finally, Koenigsegg
indicated that the CCX incorporates advanced engineering and certain
advanced safety features that are not required by the FMVSSs, including
racing brakes with anti-lock capability and traction control. In
addition, the company argued that the CCX has enhanced fuel efficiency
due to its highly aerodynamic design.
IV. Petition of Morgan
Background--Founded in 1909, Morgan is a small, privately-owned
vehicle manufacturer producing approximately 650 specialty sports cars
per year.\17\ Morgan manufactures several models, but at present, only
sells the Aero 8 in the U.S. Morgan intended to produce a vehicle line
specific to the U.S. market, with Ford supplying the engine and
transmission. However, for technical reasons, the project did not come
to fruition, and Morgan temporarily stopped selling vehicles in the
U.S. in 2004. In May 2005, Morgan obtained a temporary exemption from
this agency's bumper standard and began selling the Aero 8 in the U.S.
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\17\ A manufacturer is eligible to apply for a hardship
exemption if its total motor vehicle production in its most recent
year of production does not exceed 10,000, as determined by the
NHTSA Administrator (15 U.S.C. 1410(d)(1)).
---------------------------------------------------------------------------
On July 12, 2006 (71 FR 39386), NHTSA published a notice of receipt
of five applications for temporary exemptions from the advanced air bag
requirements of FMVSS No. 208. Among these petitions was one from
Morgan, for the Aero 8, which is discussed at pages 39390-39391.
Morgan's petition is included in the docket for that notice, i.e.,
Docket NHTSA-2006-25324.
We granted Morgan's petition for temporary exemption in a Federal
Register notice of September 7, 2006 (71 FR 52851). The discussion of
Morgan's grant is on pages 52862 though 52865. The grant of temporary
exemption is for the Morgan Aero 8 ``From S15.2, S17,
[[Page 20086]]
S19, S21, S23, and S25 of 49 CFR 571.208.'' The exemption was granted
for the period from September 1, 2006 to August 31, 2009.
In a petition dated June 11, 2009, Morgan asked for a renewal of
the temporary exemption for a two year period, from September 1, 2009
to August 31, 2011. NHTSA's statute at 49 U.S.C. 30113(b) states that
exemptions from a Federal motor vehicle safety standard are to be
granted on a ``temporary basis.'' \18\ However, the statute also
expressly provides for renewal of an exemption on reapplication.
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\18\ 49 U.S.C. 30113(b)(1).
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Morgan's petition would apply to the Aero 8 and the Aero Super
Sport, an interim vehicle also based on the Aero platform. The Aero
Super Sport will be available on an interim basis until a successor
vehicle (code named the AP8), is complete and ready for sale.
Morgan's Statement of Economic Hardship--In its petition for
temporary exemption for the Aero 8 for September 1, 2006 through August
31, 2009, Morgan estimated that U.S. sales of the Aero 8 would be
several hundred vehicles a year. In the June 11, 2009 petition, Morgan
reports that it has sold 19 Aero 8s in the U.S. from September 2006 to
the present. The 19 vehicles represent ``less than 3% of what had been
expected.''
Morgan stated it has been focusing over the last two years on the
Aero model range successor, (code named the AP8) which will be a
completely new design. However, since the original petition was granted
in 2006, it was decided to extend the availability of the present Aero
model from September 2009 to the fall of 2011, in large part due to
world economic conditions.
Because, over the past few years, Morgan did not sell as many
vehicles in the U.S. as it had hoped, and because of other economic
considerations, Morgan decided to delay development of the new AP8. In
order to ``improve available funds,'' Morgan decided to concentrate on
the Aero Super Sport, an interim project based on the Aero platform,
which Morgan hopes will be able to generate enough revenue so that
Morgan can continue to develop the AP8. The Aero Super Sport was slated
to be available in the U.S. in January 2010.
Morgan seeks an extension of the temporary exemption from the
advanced air bag requirements for the Aero Super Sport. Morgan intends
to use the exemption to cover a ``limited production run of 50 U.S.
Aero Super Sport cars.'' Morgan states the Aero Super Sport will be the
last model that is based on the Aero chassis and that uses the standard
air bag system.
Morgan states that the Aero ``must'' come to an end in 2011 because
the production of the steering wheel has ended, and no further stock,
other than that already owned by Morgan, is available. Morgan stated
that this essentially forced end to production is important because
``it essentially precludes further requests by Morgan to NHTSA to
prolong the Aero platform in the U.S.''
Morgan estimates that, assuming 50 Aero Super Sports are sold in
the U.S., the total number of exempted vehicles that Morgan
manufactures and sells in the U.S. will be 69 (50 Aero Super Sports
plus the 19 Aero 8s already sold). If Morgan can sell 69 vehicles, that
will be 656 fewer vehicles than the projected sales in Morgan's first
petition for temporary exemption in 2005.
Morgan's Statement of Good Faith Efforts to Comply--In its previous
submission, Morgan stated that it has been working with the air bag
supplier Siemens to develop an advanced air bag system for the Aero 8.
However, a lack of funds and technical problems precluded the
implementation of an advanced air bag system for the Aero 8. It said
that the minimum time needed to develop an advanced air bag system
(provided that there is a source of revenue) is two years. Specific
technical challenges include the following. Morgan does not have access
to the necessary sensor technology to pursue the ``full suppression''
passenger air bag option. Due to the design of the Aero 8 platform
dashboard, an entirely new interior solution and design must be
developed. Chassis modifications are anticipated due to the originally
stiff chassis design.
In its February 2006 petition, Morgan stated that for vehicles to
be built between September 2006-September 2009, the Aero 8 vehicles
will have (and in fact, did have) standard air bags. Back then, Morgan
stated its belief that when its advanced air bag system is ready in
2009, the air bag system will simultaneously be installed in both the
Aero and other models.
Morgan's Statement of Public Interest--In its original petition
concerning the Aero, Morgan put forth several arguments supporting its
view that the requested exemption is consistent with the public
interest. According to Morgan, if the exemption was denied and Morgan
stops U.S. sales, Morgan's U.S. dealers would unavoidably have numerous
lay-offs, resulting in U.S. unemployment. Denial of an exemption would
reduce consumer choice in the specialty sports car market sector in
which Morgan cars compete. That company argued that the Morgan vehicles
will not be used extensively by owners, and are unlikely to carry small
children. Finally, according to Morgan, granting an exemption would
assure the continued availability of proper parts and service support
for existing Morgan owners. Without an exemption, Morgan would be
forced from the U.S. market, and Morgan dealers would find it difficult
to support existing customers.
In its petition asking for a renewal of the temporary exemption
from FMVSS No. 208, Morgan reiterated these points.
V. Public Comment Period
We are providing a 30-day comment period on Koenigsegg's and
Morgan's petitions for an extension of a temporary exemption from the
advanced air bag requirement of FMVSS No. 208. After considering public
comments and other available information, we will publish a notice of
final action addressing each application in the Federal Register.
VI. Public Participation
How do I prepare and submit comments?
Your comments must be written and in English. To ensure that your
comments are correctly filed in the Docket, please include the docket
number of this document in your comments.
Your comments must not be more than 15 pages long. (49 CFR 553.21).
We established this limit to encourage you to write your primary
comments in a concise fashion. However, you may attach necessary
additional documents to your comments. There is no limit on the length
of the attachments.
Please submit two copies of your comments, including the
attachments, to the Docket at the address given above under ADDRESSES.
Comments may also be submitted to the docket electronically by
logging into https://www.regulations.gov. Follow the online instructions
for submitting comments.
Please note that pursuant to the Data Quality Act, in order for
substantive data to be relied upon and used by the agency, it must meet
the information quality standards set forth in the OMB and DOT Data
Quality Act guidelines. Accordingly, we encourage you to consult the
guidelines in preparing your comments. OMB's guidelines may be accessed
at https://www.whitehouse.gov/omb/fedreg/reproducible.html.
[[Page 20087]]
How can I be sure that my comments were received?
If you wish Docket Management to notify you upon its receipt of
your comments, enclose a self-addressed, stamped postcard in the
envelope containing your comments. Upon receiving your comments, Docket
Management will return the postcard by mail.
How do I submit confidential business information?
If you wish to submit any information under a claim of
confidentiality, you should submit three copies of your complete
submission, including the information you claim to be confidential
business information, to the Chief Counsel, NHTSA, at the address given
above under FOR FURTHER INFORMATION CONTACT. In addition, you should
submit two copies, from which you have deleted the claimed confidential
business information, to Docket Management at the address given above
under ADDRESSES. When you send a comment containing information claimed
to be confidential business information, you should include a cover
letter setting forth the information specified in our confidential
business information regulation. (49 CFR part 512.)
Will the agency consider late comments?
We will consider all comments that Docket Management receives
before the close of business on the comment closing date indicated
above under DATES. To the extent possible, we will also consider
comments that Docket Management receives after that date. If Docket
Management receives a comment too late for us to consider in developing
a final rule (assuming that one is issued), we will consider that
comment as an informal suggestion for future rulemaking action.
How can I read the comments submitted by other people?
You may read the comments received by Docket Management at the
address given above under ADDRESSES. The hours of the Docket are
indicated above in the same location. You may also see the comments on
the Internet. To read the comments on the Internet, go to https://www.regulations.gov. Follow the online instructions for accessing the
dockets.
Please note that even after the comment closing date, we will
continue to file relevant information in the Docket as it becomes
available. Further, some people may submit late comments. Accordingly,
we recommend that you periodically check the Docket for new material.
Authority: 49 U.S.C. 30113; delegations of authority at 49 CFR
1.50. and 501.8.
Issued on: April 5, 2011.
Joseph S. Carra,
Acting Associate Administrator for Rulemaking.
[FR Doc. 2011-8468 Filed 4-8-11; 8:45 am]
BILLING CODE 4910-59-P
