Guide Concerning Fuel Economy Advertising for New Automobiles, 27820-27824 [2014-10889]

Download as PDF 27820 Federal Register / Vol. 79, No. 94 / Thursday, May 15, 2014 / Proposed Rules encourages individuals to provide important safety information that it otherwise might not receive. The FAA designates the following information as protected from disclosure in accordance with 49 U.S.C. 40123 and 14 CFR part 193: b. Description of the type of information that may be voluntarily provided under the program and a summary of why the FAA finds that the information is safety-related. (1) The following types of reports are ordinarily submitted under the T–SAP or ATSAP: i. Noncompliance reports. Noncompliance reports identify specific instances of a failure to follow FAA directives. ii. Aviation safety concern reports. Aviation safety concerns that do not involve specific noncompliance with FAA directives. These may include, but are not limited to, potential safety events or perceived problems with policies, procedures, and equipment. (2) Technical Operations personnel support the delivery and efficiency of flight services through maintenance of the National Airspace System facilities, systems and equipment. Reports submitted by these employees under T– SAP ordinarily involve matters or observations occurring during the performance of their job responsibilities, and therefore the information submitted is inherently safety related. Air Traffic personnel provide and support the provision of air traffic services at FAA facilities throughout the NAS. Reports submitted by these employees under ATSAP ordinarily involve occurrences or problems identified or experienced during the performance of their job responsibilities which directly affect safety. Issued in Washington, DC, on May 9, 2014. Michael P. Huerta, Administrator, Federal Aviation Administration. [FR Doc. 2014–11150 Filed 5–14–14; 8:45 am] BILLING CODE 4910–13–P FEDERAL TRADE COMMISSION TKELLEY on DSK3SPTVN1PROD with PROPOSALS 16 CFR Part 259 Guide Concerning Fuel Economy Advertising for New Automobiles Federal Trade Commission. Regulatory Review; Request for public comment. AGENCY: ACTION: The Federal Trade Commission (‘‘FTC’’ or ‘‘Commission’’) resumes its regulatory review of the Guide Concerning Fuel Economy SUMMARY: VerDate Mar<15>2010 17:07 May 14, 2014 Jkt 232001 Advertising for New Automobiles (‘‘Fuel Economy Guide’’ or ‘‘Guide’’). The Commission seeks comments on potential amendments to update the Guide to reflect changes to the Environmental Protection Agency’s (‘‘EPA’’) fuel economy labeling rules, address advertising for alternative fueled vehicles, and consider other advertising claims prevalent in the market. Comments must be received on or before July 10, 2014. ADDRESSES: Interested parties may file a comment online or on paper by following the instructions in the Request for Comment part of the SUPPLEMENTARY INFORMATION section below. Write ‘‘Fuel Economy Guide, R711008’’ on your comment, and file your comment online at https:// ftcpublic.commentworks.com/ftc/ fueleconomyguide by following the instructions on the web-based form. If you prefer to file your comment on paper, mail your comment to the following address: Federal Trade Commission, Office of the Secretary, 600 Pennsylvania Avenue NW., Suite CC–5610, (Annex O), Washington, DC 20580, or deliver your comment to the following address: Federal Trade Commission, Office of the Secretary, Constitution Center, 400 7th Street SW., 5th Floor, Suite 5610, (Annex O), Washington, DC 20024. FOR FURTHER INFORMATION CONTACT: Hampton Newsome, (202) 326–2889, Attorney, Division of Enforcement, Bureau of Consumer Protection, Federal Trade Commission, Room M–8102B, 600 Pennsylvania Avenue NW., Washington, DC 20580. SUPPLEMENTARY INFORMATION: DATES: I. Background The Commission issued the Fuel Economy Guide (16 CFR Part 259) in 1975 to prevent deceptive fuel economy advertising for new automobiles and to facilitate the use of fuel economy information in advertising. The Guide helps advertisers avoid unfair or deceptive claims under Section 5 of the FTC Act. To accomplish this goal, the Guide advises marketers to disclose established EPA fuel economy estimates (e.g., miles per gallon or ‘‘mpg’’) whenever they make any fuel economy claim based on those estimates. In addition, 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 test’s source, driving conditions, and vehicle configurations. PO 00000 Frm 00049 Fmt 4702 Sfmt 4702 On April 28, 2009 (74 FR 19148), the Commission published a Notice of Proposed Rulemaking (‘‘NPRM’’) soliciting comments on proposed amendments to the Guide. The Commission then postponed its Guide review in a June 1, 2011 Notice (76 FR 31467) pending new fuel economy labeling requirements from the EPA and completion of the FTC’s Alternative Fuel Rule (16 CFR Part 309) review. The Commission explained that Fuel Economy Guide revisions would be premature before the conclusion of these regulatory proceedings. With these two activities now complete, the Commission resumes its review of the Fuel Economy Guide with this document.1 The document contains a discussion of the Guide’s format and content, a brief analysis of earlier comments received, and a discussion of several fuel economy claims. The Commission seeks comments on these issues, including issues it has raised in earlier documents, and any other matter related to the Guide. Though this document contains several proposed changes to the Guide, it does not present specific, proposed text revisions. The Commission will wait and include, if warranted, such specific language in a subsequent document after reviewing comments and consumer research results. In considering potential revisions to the FTC Guide, commenters should focus on information that helps marketers avoid deceptive or unfair claims prohibited by the FTC Act.2 The Guide is not intended to identify disclosures that are merely helpful or desirable to consumers. Likewise, commenters should not address the adequacy of EPA fuel economy test procedures or the accuracy of EPA label content. Such issues fall within the EPA’s purview and the Commission generally defers to that agency’s technical expertise and statutory authority over such matters and are 1 The Commission announced final revisions to the Alternative Fuels Rule in an April 23, 2013 Final Rule (78 FR 23832). In 2011, EPA completed revisions to its fuel economy labeling requirements, which, among other things, addressed labels for alternative-fueled vehicles (AFVs) not specifically addressed in past EPA requirements. See 76 FR 39478 (July 6, 2011). 2 15 U.S.C. 45(a). The Guides do not have the force and effect of law and are not independently enforceable. However, failure to comply with industry guides may result in law enforcement action under applicable statutory provisions. The Commission, therefore, can take action under the FTC Act if a business makes fuel economy claims inconsistent with the Guides. In any such enforcement action, the Commission must prove that the act or practice at issue is unfair or deceptive in violation of Section 5 of the FTC Act. E:\FR\FM\15MYP1.SGM 15MYP1 Federal Register / Vol. 79, No. 94 / Thursday, May 15, 2014 / Proposed Rules generally outside the scope of the Guide. II. Issues for Comment The Commission seeks comment on several issues related to the Fuel Economy Guide including some raised by earlier comments,3 and others identified by the Commission based on recent EPA label changes. These issues fall into two categories: General matters related to the Guide review and specific fuel economy advertising claims. A. General Matters for the Guide Review As discussed below, the Commission seeks comment on general issues related to the Guide including definitions, citation format, the Guide’s overall format, and consumer research. TKELLEY on DSK3SPTVN1PROD with PROPOSALS 1. Definitions In its previous NPRM, the Commission proposed fives changes related to the Guide’s definitions section (16 CFR 259.1). The Commission received no comments in response. The Commission again seeks comment on these changes.4 First, the Commission proposes to replace several outdated terms in the Guide to ensure they are consistent with those in EPA’s current fuel economy rules.5 Specifically, the definition ‘‘Estimated city mpg.’’ would change to ‘‘Estimated city fuel economy’’; ‘‘Estimated highway mpg.’’ would change to ‘‘Estimated highway fuel economy’’; and the term ‘‘fuel economy’’ would change to refer to a vehicle’s ‘‘fuel efficiency.’’ In addition, the Commission proposes to eliminate the term ‘‘estimated in-use fuel economy range’’ because EPA’s fuel economy label no longer provides such information.6 Second, the Commission proposes to add the term ‘‘Combined fuel economy’’ to Section 259.1 of the Guide to ensure consistency and reduce potential confusion because EPA now uses this term on its label.7 Consistent with EPA 3 In response to the 2009 document, the Commission received eight comments from sources including the automobile manufacturing industry, local government, and consumers groups. Comments are available at: https://www.ftc.gov/os/ comments/fueleconadguidepropamend/index.shtm. Generally, the comments supported retention of the Guide and recognized its benefits. 4 The Commission, in the 2009 NPRM, also proposed to add two terms, ‘‘Fuel’’ and ‘‘Alternative Fueled Vehicles,’’ to distinguish the vehicles that would be covered by the guidance for the EPA label requirements from those covered by the proposed guidance regarding alternative fueled vehicles. 74 FR 19148. 5 See 40 CFR 600.002. 6 See 16 CFR 259.1(e) (definition of ‘‘estimated inuse fuel economy range’’). 7 See 40 CFR 600, Appendix VI. VerDate Mar<15>2010 17:07 May 14, 2014 Jkt 232001 requirements,8 the Commission proposes to 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.’’ 9 The new term would expand the Commission’s guidance to marketers whose vehicles now display combined fuel economy estimate information required by the EPA. Third, the Commission proposes to amend the Guide’s definition of ‘‘new automobile’’ to incorporate changes made to the EPA’s fuel labeling requirements. The EPA’s rules require vehicle manufacturers to display a fuel economy label for a new class of vehicles, ‘‘medium-duty passenger vehicles.’’ 10 To conform with EPA’s change, the Commission plans to augment the definition of ‘‘new automobile’’ to include ‘‘medium-duty passenger vehicle’’ as one of the classes of vehicles covered by the Fuel Economy Guide. Fourth, the Commission proposes several minor revisions including an amendment to the definition of ‘‘range of fuel economy’’ to eliminate the phrase ‘‘in use,’’ and changes to the definitions for ‘‘estimated city mpg’’ and ‘‘estimated highway mpg’’ to ensure consistency with the terms and definitions used by the EPA. The Commission also proposes to eliminate an obsolete reference to the term ‘‘unique nameplate’’ in footnote 2 of the Guide and replace it with the more appropriate EPA term ‘‘model type.’’ 11 Finally, the Commission proposes to reorganize the definition of ‘‘new automobile’’ to reduce the definition’s length and potential confusion. Specifically, the proposed amendment would remove the definitions ‘‘dealer,’’ ‘‘manufacturer,’’ and ‘‘ultimate purchaser’’ from ‘‘new automobile’’ and list them as separate terms under section 259.1.12 8 See 40 CFR 600.206–12. Commission proposes to adopt EPA’s definition for the term. See 71 FR 77872, 77927 (Dec. 27, 2006). 10 40 CFR 86.1803–01. Previously, the EPA required fuel economy labels for only passenger automobiles and light trucks. 11 77 FR 77928. 12 The definitions for ‘‘dealer,’’ ‘‘manufacturer,’’ and ‘‘ultimate purchaser’’ have not been altered in any other way. 9 The PO 00000 Frm 00050 Fmt 4702 Sfmt 4702 27821 2. Regulatory Citations In its previous NPRM, the FTC proposed to replace all specific regulatory citations to EPA regulations in the Guide with general citations (40 CFR Part 600) to reduce the frequency of future Guide changes should EPA amend its regulations. In comments, the Association of International Automobile Manufacturers, Inc. (‘‘AIAM’’) noted that this proposal would create confusion because the general EPA provisions cited in the proposal contain two different sets of fuel economy requirements, one of which is not directly applicable to FTC’s Guide. To avoid such confusion, the Commission no longer plans to use general citations in the Guide. 3. Guide Format The Commission also proposes to improve the Guide’s format to ensure consistency with other recently amended FTC guides, such as the Guides For the Use of Environmental Marketing Claims.13 Under this format, the revised Guide would contain a list of general principles to help marketers avoid deceptive practices, coupled with specific sample claims to illustrate those principles. This format, with its detailed examples, places the general principles in a useful context for marketers and helps readers locate relevant information. In addition, the sample claims frame the general principles in a clear context, thus improving understanding of the Guide. The Commission seeks comment on such an approach, including, as discussed in more detail below, the types of claims that the Guide should feature. 4. Consumer Research The Commission plans to conduct consumer research to enhance the Commission’s understanding of how consumers understand fuel economy advertising claims. In particular, the Commission plans to explore several common advertising claims, such as general fuel economy claims, unqualified or minimally qualified mpg disclosures, and claims for vehicle driving range based on non-EPA test procedures. The FTC and its contractor will administer questions to the respondents online over the Internet. The study will employ standard consumer survey methodologies, such as choice experiments, to explore how different claims affect consumer decision-making. The Commission will 13 See Guides for the Use of Environmental Marketing Claims (‘‘Green Guides’’) (16 CFR Part 260); Guides Concerning the Use of Endorsements and Testimonials in Advertising (16 CFR Part 255). E:\FR\FM\15MYP1.SGM 15MYP1 27822 Federal Register / Vol. 79, No. 94 / Thursday, May 15, 2014 / Proposed Rules provide more detail regarding the study in a separate document. B. Types of Fuel Economy Claims As discussed in detail below, the Commission seeks comment on specific types of advertising claims, including EPA-based miles-per-gallon claims, claims based on non-EPA tests, claims related to vehicle configuration, range of fuel economy claims, and alternative fueled vehicle claims. TKELLEY on DSK3SPTVN1PROD with PROPOSALS 1. EPA Miles-Per-Gallon Claims The Commission seeks comment on the Guide’s current provisions for mpg claims (section 259.2(a)). The current Guide states that any express or implied fuel economy claim must be accompanied by a corresponding EPA fuel economy rating (i.e., EPA mpg number) matching the representation. For example, if an advertisement contains a city-related representation (e.g., ‘‘XYC car gets great mileage in the city’’), the Guide advises the advertiser to disclose the vehicle’s EPA city mileage rating.14 In the NPRM, the Commission noted that EPA’s labeling rule now requires manufacturers to disclose a ‘‘combined’’ fuel economy estimate, in addition to city and highway estimates, on the fuel economy label.15 Accordingly, consistent with guidance for highway and city ratings, the proposed amendments advised advertisers to disclose an EPA combined fuel economy estimate for any representation related to combined fuel economy.16 In response, commenters raised several concerns about the current guidance for mpg claims. First, two commenters insisted that both city and highway fuel economy estimates must appear in all advertisements because such estimates are material to consumers’ purchasing decisions.17 14 The Guide does not direct marketers to provide both highway and city ratings unless the advertisement contains fuel economy claims related to both city and highway performance. Where a fuel economy claim does not specify highway or city performance (e.g., ‘‘XYZ car gets great mileage’’), the Guide indicates that the marketer should disclose the vehicle’s city mpg. The Guide also advises marketers to state that EPA is the source of the mpg ratings and that such ratings are estimates. 15 74 FR 19149. 16 74 FR 19150. Section 259.2(a) does not prohibit disclosure of both the city and highway estimates. For example, a manufacturer could display the EPA’s city and highway economy estimate in a print advertisement for a vehicle. Alternately, the same company could display only the EPA’s combined fuel economy estimate in a television advertisement for the same vehicle and still comply with the current Guide. 17 Montgomery County, Maryland, Office of Consumer Protection (#541056–00007) (‘‘Montgomery County’’); Public Citizen, the Center for Auto Safety, and the Safe Climate Campaign VerDate Mar<15>2010 17:07 May 14, 2014 Jkt 232001 Second, comments suggested that disclosure of a single mpg rating (e.g., highway mileage only) overstates the actual fuel economy for some contexts and that, regardless of the presence of qualifying language, consumers will expect a vehicle to attain the advertised mileage.18 Furthermore, Public Citizen and other consumer group commenters expressed concern that manufacturers advertise only the most favorable fuel economy estimates for their vehicles.19 Finally, another commenter suggested that only the combined city and highway fuel economy rating be allowed in advertising.20 The Commission seeks comments on various aspects of the mpg provision of the current Guide (section 259.2(a)). Commenters should limit their comments to addressing deceptive and unfair claims under the FTC Act and should not recommend guidance, including affirmative disclosures, merely because such information would help consumer purchasing decisions. Among other things, the Commission seeks comments on: (1) Whether a general fuel economy claim (e.g., ‘‘XYZ car gets great mileage’’) should be accompanied by a specific mpg disclosure to prevent consumer deception or unfairness; (2) whether an advertisement is unfair or deceptive if it provides only one type of mileage rating (e.g., an advertisement that only provides highway mpg); (3) whether an unspecified mpg claim (e.g., ‘‘37 mpg’’) is deceptive if the advertisement fails to identify whether the rating is city, highway, or combined; (4) how consumers understand ‘‘up to’’ mpg claims, which sometimes appear in ads (e.g., ‘‘up to 45 mpg’’); (5) whether the combined EPA mpg rating should serve as the default disclosure for unspecified fuel economy claims (instead of the city mpg as currently indicated in the Guide); (6) whether the Guide should advise marketers to avoid statements (#541056–00009) (‘‘Public Citizen’’). Public Citizen proposed that both city and highway estimates be displayed and that the city fuel economy be expressed in larger text than the highway fuel economy. Montgomery County further suggested that the Guide adopt a comparative fuel economy scale, ‘‘similar to the 0–10 scale for air pollution provided by the EPA.’’ 18 Public Citizen; Montgomery County. Montgomery County argued that disclosing only one fuel economy rating could be misleading to consumers with hybrid vehicles: ‘‘Unlike traditional autos . . . hybrids often receive higher city than highway ratings. . . . [M]any consumers, familiar with EPA estimates, look at the high city estimate in a hybrid ad and conclude, based on past experience, that the unstated highway mileage must be even higher.’’ Montgomery County at 2. 19 Public Citizen. 20 Consumer Federation of America et al. (‘‘CFA’’) (#541056–00006). PO 00000 Frm 00051 Fmt 4702 Sfmt 4702 that imply a linear relationship between mpg and fuel costs; (7) whether fuel economy advertisements containing mpg claims should identify EPA as the source of the ratings; and (8) whether FTC should provide additional guidance regarding disclaimers that the EPA ratings are only estimates. 2. Claims Based on Non-EPA Estimates The Commission is also considering whether the Guide’s provisions for advertising claims based on non-EPA tests should be updated. Section 259.2(c) advises that advertisers may make fuel economy claims based on non-EPA information only if 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. In response to the NPRM, the comments offered conflicting views on this guidance. Some consumer groups urged the FTC to prohibit altogether any non-EPA fuel economy estimate in advertising because such estimates may thwart consumers’ efforts to compare vehicle fuel economy.21 The Council of Better Business Bureaus (‘‘BBB’’) supported the current Guide’s non-EPA claim provision explaining that it gives advertisers the flexibility to advertise legitimate fuel efficiency claims while still permitting fair comparisons with other vehicles. The Commission seeks further comment on this issue. Commenters should address, among other things, the prevalence of non-EPA fuel economy claims, including both traditional fuel economy claims (e.g., mpg) as well as electric vehicle driving range claims (e.g., ‘‘100 miles per charge’’); and the adequacy of the current guidance for preventing deception. 3. Claims Related to Model Groups The current Guide advises manufacturers to limit fuel economy ratings to the corresponding model type to ensure advertised fuel economy ratings match the advertised vehicles specification, citing EPA requirements for vehicle configuration (40 CFR 21 CFA stated that despite required source disclosures, non-EPA information would, ‘‘[a]t the worst . . . mislead consumers; at the best, simply confuse them and prevent them from using advertised rating information comparatively.’’ Public Citizen shared the CFA’s concerns and further stated that, ‘‘Allowing a non-EPA derived estimate does not have any consumer utility . . . [and] the existence of two different fuel economy rating systems in fuel economy advertisements can only create consumer confusion and mistrust for the reliability of both . . . ’’ Public Citizen at 4. E:\FR\FM\15MYP1.SGM 15MYP1 Federal Register / Vol. 79, No. 94 / Thursday, May 15, 2014 / Proposed Rules In the NPRM, the Commission proposed disclosure requirements for vehicles covered by the FTC’s Alternative Fuels Rule (16 CFR Part 309).26 The proposed amendment mirrored the Guide’s other provisions by advising marketers to advertise estimated cruising ranges determined under the Alternative Fuels Rule as well as non-FTC sources. In advertisements that display non-FTC derived estimates, the proposal advised advertisers to: (1) Display the estimated cruising range required on the FTC label more prominently than any other estimate; (2) disclose the source of the cruising range estimate; and (3) display any material differences between the method used and the method required by the FTC’s labeling rule.27 Commenters raised several issues with the proposed amendments. Some argued that the numerous inconsistencies in EPA and FTC standards and calculations for AFVs would render any prospective guidance confusing and ineffective.28 Another group of commenters recommended guidance about alternative fueled vehicles that also use gasoline (i.e., flexible fueled vehicles (FFV)).29 In particular, these comments noted that many FFVs have one fuel economy rating for gasoline and another for alternative fuel operation. They recommended disclosure of fuel economy estimates for every allowable fuel a vehicle may use. They also urged additional disclosures to reduce consumer confusion and raise awareness that alternative fueled vehicles may operate more efficiently on gasoline than on alternative fuel. In April 2013, the Commission amended the Alternative Fuels Rule to consolidate the FTC’s alternative fueled vehicle labels with EPA’s new fuel economy labels.30 Because those amendments removed any potential conflict between FTC and EPA labels, there is no need for information in the Guide related to FTC alternative fueled vehicles labels. Nonetheless, the Commission seeks additional comment on whether the Guide should address advertising for FFVs, particularly as it pertains to different fuel economy estimates for different fuels. Specifically, commenters should address whether advertisements that provide a vehicle’s gasoline mpg rating and identify the vehicle as an FFV should also disclose that vehicle’s alternative fuel mpg rating. In addressing this issue, commenters should indicate whether such ads are common and whether FTC guidance 22 The EPA’s fuel economy regulations define model type as ‘‘a unique combination of car line, basic engine, and transmission class’’ 40 CFR 600.002–85 (emphasis added.) 23 Section 259.2, n. 2 states that the ‘‘estimated city mpg’’ and the ‘‘estimated highway mpg’’ must be those applicable to the specific nameplate being advertised. Fuel economy estimates assigned to ‘‘unique nameplates’’ apply only to such unique car lines. As discussed earlier in this document, the Commission also proposes to eliminate 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.’’ 24 BBB; Public Citizen. 25 Public Citizen. Similarly, Montgomery County offered several examples of noncompliant advertising as further proof that failing to disclose the vehicle configuration to which the estimates apply is deceptive. 26 77 FR 19152. 27 The Commission also proposed adding two terms, ‘‘Fuel’’ and ‘‘Alternative Fueled Vehicles,’’ to distinguish the vehicles that would be covered by the guidance for the EPA label requirements from those covered by the proposed guidance regarding alternative fueled vehicles. The NPRM defined ‘‘Fuel’’ to include gasoline and diesel fuel, electrical energy, alcohol, and natural gas. The NPRM also defined ‘‘Alternative Fueled Vehicle’’ to cover any vehicle that qualifies as a covered vehicle under 16 CFR Part 309. This term covers any vehicle designed to operate solely on an alternative fuel, or dual-fuel such as ethanol, natural gas, liquefied petroleum gas, hydrogen, coal-derived fuel, fuels from biological materials, electricity, or other fuels determined by the secretary to yield substantial security and environmental benefits. 28 See, e.g., Alliance of Automobile Manufacturers (#541056–00002). 29 See Public Citizen. 30 78 FR 23832 (April 23, 2013). 600.207).22 Specifically, section 259.2, n. 2 of the Guide warns against using a single fuel economy estimate for all vehicles bearing a common model name, if separate vehicles within that model group have different fuel economy ratings.23 Addressing this issue, two commenters argued that the Guide should require all advertisements to disclose the model year and the vehicle configuration tested.24 Public Citizen noted that the current Guide would allow the ‘‘highest fuel economy vehicle configuration of one model to be applied to all vehicle configurations of that model.’’ 25 The BBB noted that, in some advertising, marketers fail to identify ‘‘the specific vehicle variables affecting a vehicle’s fuel economy not specified (e.g., automatic or standard transmission, engine size, four wheel drive versus front wheel drive, etc.).’’ The Commission seeks further comment on this issue. Among other things, the Commission invites commenters to address whether the FTC should provide further guidance to help advertisers avoid deceptive claims in this context. TKELLEY on DSK3SPTVN1PROD with PROPOSALS 4. Claims for Alternative Fueled Vehicles VerDate Mar<15>2010 17:07 May 14, 2014 Jkt 232001 PO 00000 Frm 00052 Fmt 4702 Sfmt 4702 27823 would help marketers avoid deceptive claims. 5. Fuel Economy Range Claims Section 259.2(b)(1) addresses ‘‘estimated in-use fuel economy range’’ claims (e.g., ‘‘expected range for most drivers 15 to 21 mpg’’). Because EPA’s revised label no longer contains this information and no evidence suggests such claims are prevalent in the market, the Commission proposes to eliminate that specific provision from the Guide. At this time, the Commission does not propose to eliminate section 259.2(b)(2), which addresses range information for automobile classes (e.g., ‘‘Small SUVs range from 16 to 32 mpg’’). III. Request for Comments You can file a comment online or on paper. For the Commission to consider your comment, we must receive it on or before July 10, 2014. Write ‘‘Fuel Economy Guide, R711008’’ on your comment. Your comment—including your name and your state—will be placed on the public record of this proceeding, including, to the extent practicable, on the public Commission Web site, at https://www.ftc.gov/os/ publiccomments.shtm. As a matter of discretion, the Commission tries to remove individuals’ home contact information from comments before placing them on the Commission Web site. Because your comment will be made public, you are solely responsible for making sure that your comment does not include any sensitive personal information, such as anyone’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. You are also solely responsible for making sure that your comment does not include any sensitive health information, such as medical records or other individually identifiable health information. In addition, do not include any ‘‘[t]rade secret or any commercial or financial information which is . . . privileged or confidential,’’ as discussed in Section 6(f) of the FTC Act, 15 U.S.C. 46(f), and FTC Rule 4.10(a)(2), 16 CFR 4.10(a)(2). In particular, do not include competitively sensitive information such as costs, sales statistics, inventories, formulas, patterns, devices, manufacturing processes, or customer names. If you want the Commission to give your comment confidential treatment, you must file it in paper form, with a request for confidential treatment, and you have to follow the procedure E:\FR\FM\15MYP1.SGM 15MYP1 27824 Federal Register / Vol. 79, No. 94 / Thursday, May 15, 2014 / Proposed Rules explained in FTC Rule 4.9(c), 16 CFR 4.9(c).31 Your comment will be kept confidential only if the FTC General Counsel grants your request in accordance with the law and the public interest. Postal mail addressed to the Commission is subject to delay due to heightened security screening. As a result, we encourage you to submit your comments online. To make sure that the Commission considers your online comment, you must file it at https:// ftcpublic.commentworks.com/ftc/ fueleconomyguide, by following the instruction on the web-based form. If this Notice appears at https:// www.regulations.gov, you also may file a comment through that Web site. If you file your comment on paper, write ‘‘Fuel Economy Guide, R711008’’ on your comment and on the envelope, and mail it to the following address: Federal Trade Commission, Office of the Secretary, 600 Pennsylvania Avenue NW, Suite CC–5610, (Annex O), Washington, DC 20580, or deliver your comment to the following address: Federal Trade Commission, Office of the Secretary, Constitution Center, 400 7th Street SW., 5th Floor, Suite 5610, (Annex O), Washington, DC 20024. If possible, submit your paper comment to the Commission by courier or overnight service. Visit the Commission Web site at https://www.ftc.gov to read this NPRM and the News Release describing this proceeding. The FTC Act and other laws that 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 on or before July 10, 2014. You can find more information, including routine uses permitted by the Privacy Act, in the Commission’s privacy policy, at https:// www.ftc.gov/ftc/privacy.htm. By direction of the Commission. Donald S. Clark, Secretary. [FR Doc. 2014–10889 Filed 5–14–14; 8:45 am] TKELLEY on DSK3SPTVN1PROD with PROPOSALS BILLING CODE 6750–01–P 31 In particular, the written request for confidential treatment that accompanies the comment must include the factual and legal basis for the request, and must identify the specific portions of the comment to be withheld from the public record. See FTC Rule 4.9(c), 16 CFR 4.9(c). VerDate Mar<15>2010 17:07 May 14, 2014 Jkt 232001 EQUAL EMPLOYMENT OPPORTUNITY COMMISSION 29 CFR Part 1614 RIN 3046–AA94 The Federal Sector’s Obligation To Be a Model Employer of Individuals With Disabilities Equal Employment Opportunity Commission. ACTION: Advance notice of proposed rulemaking. AGENCY: The Equal Employment Opportunity Commission (‘‘EEOC’’ or ‘‘Commission’’) is issuing an Advance Notice of Proposed Rulemaking to invite the public to comment on how it can amend its regulations to clarify the federal government’s obligation to be a model employer of individuals with disabilities. DATES: Submit comments on or before July 14, 2014. ADDRESSES: You may submit comments, identified by RIN 3046–AA94, by any of the following methods: • Federal eRulemaking Portal: https:// www.regulations.gov. Follow the instructions for submitting comments. • Fax: (202) 663–4114. (There is no toll free FAX number). Only comments of six or fewer pages will be accepted via FAX transmittal, in order to assure access to the equipment. Receipt of FAX transmittals will not be acknowledged, except that the sender may request confirmation of receipt by calling the Executive Secretariat staff at (202) 663– 4070 (voice) or (202) 663–4074 (TTY). (These are not toll free numbers). • Mail: Bernadette Wilson, Acting Executive Officer, Executive Secretariat, Equal Employment Opportunity Commission, U.S. Equal Employment Opportunity Commission, 131 M Street NE., Washington, DC 20507. • Hand Delivery/Courier: Bernadette Wilson, Acting Executive Officer, Executive Secretariat, Equal Employment Opportunity Commission, U.S. Equal Employment Opportunity Commission, 131 M Street NE., Washington, DC 20507. Instructions: The Commission invites comments from all interested parties. All comment submissions must include the agency name and docket number or the Regulatory Information Number (‘‘RIN’’) for this rulemaking. Comments need be submitted in only one of the above-listed formats. All comments received will be posted without change to https://www.regulations.gov, including any personal information you provide. Docket: For access to the docket to read background documents or SUMMARY: PO 00000 Frm 00053 Fmt 4702 Sfmt 4702 comments received, go to https:// www.regulations.gov. Copies of the received comments also will be available for review at the Commission’s library, 131 M Street NE., Suite 4NW08R, Washington, DC 20507, between the hours of 9:30 a.m. and 5:00 p.m., from July 14, 2014 until the Commission publishes the rule in final form. FOR FURTHER INFORMATION CONTACT: Christopher Kuczynski, Assistant Legal Counsel, or Aaron Konopasky, Senior Attorney-Advisor, at (202) 663–4637 (voice) or (202) 663–7026 (TTY). (These are not toll free numbers.) Requests for this notice in an alternative format should be made to the Office of Communications and Legislative Affairs at (202) 663–4191 (voice) or (202) 663– 4494 (TTY). SUPPLEMENTARY INFORMATION: Section 501 of the Rehabilitation Act of 1973, as amended (‘‘section 501’’),1 requires both nondiscrimination and affirmative action with respect to federal employees and applicants for federal employment who are individuals with disabilities. It provides specifically that the standards used to determine whether a federal agency 2 has discriminated against an individual with a disability ‘‘shall be the standards applied under title I of the Americans with Disabilities Act of 1990 . . . and the provisions of sections 501 through 504, and 510, of the Americans with Disabilities Act of 1990 . . . as such sections relate to employment.’’ 3 It also requires federal agencies to maintain, update annually, and submit to the Commission an ‘‘affirmative action program plan for the hiring, placement, and advancement of individuals with disabilities.’’ 4 Commission regulations implementing section 501 reiterate that federal agencies are prohibited from discriminating against individuals with disabilities under Americans with Disabilities Act (‘‘ADA’’) standards, and further clarify that 29 CFR part 1630 is intended to set forth those standards.5 Additionally, the section 501 regulations provide that the federal government ‘‘shall be a model employer of individuals with disabilities.’’ 6 1 29 U.S.C. 791. 501 applies to ‘‘each department, agency, and instrumentality (including the United States Postal Service and the Postal Regulatory Commission) in the executive branch and the Smithsonian Institution.’’ 29 U.S.C. 791(b). For convenience, this Notice uses the term ‘‘federal agency’’ or ‘‘agency’’ to mean any federal entity covered by Section 501. 3 29 U.S.C. 791(g). 4 29 U.S.C. 791(b). 5 29 CFR 1614.203(b). 6 29 CFR 1614.203(a). 2 Section E:\FR\FM\15MYP1.SGM 15MYP1

Agencies

FEDERAL TRADE COMMISSION

[Federal Register Volume 79, Number 94 (Thursday, May 15, 2014)]
[Proposed Rules]
[Pages 27820-27824]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2014-10889]

=======================================================================
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FEDERAL TRADE COMMISSION

16 CFR Part 259

Guide Concerning Fuel Economy Advertising for New Automobiles

AGENCY: Federal Trade Commission.

ACTION: Regulatory Review; Request for public comment.

-----------------------------------------------------------------------

SUMMARY: The Federal Trade Commission (``FTC'' or ``Commission'')
resumes its regulatory review of the Guide Concerning Fuel Economy
Advertising for New Automobiles (``Fuel Economy Guide'' or ``Guide'').
The Commission seeks comments on potential amendments to update the
Guide to reflect changes to the Environmental Protection Agency's
(``EPA'') fuel economy labeling rules, address advertising for
alternative fueled vehicles, and consider other advertising claims
prevalent in the market.

DATES: Comments must be received on or before July 10, 2014.

ADDRESSES: Interested parties may file a comment online or on paper by
following the instructions in the Request for Comment part of the
SUPPLEMENTARY INFORMATION section below. Write ``Fuel Economy Guide,
R711008'' on your comment, and file your comment online at https://ftcpublic.commentworks.com/ftc/fueleconomyguide by following the
instructions on the web-based form. If you prefer to file your comment
on paper, mail your comment to the following address: Federal Trade
Commission, Office of the Secretary, 600 Pennsylvania Avenue NW., Suite
CC-5610, (Annex O), Washington, DC 20580, or deliver your comment to
the following address: Federal Trade Commission, Office of the
Secretary, Constitution Center, 400 7th Street SW., 5th Floor, Suite
5610, (Annex O), Washington, DC 20024.

FOR FURTHER INFORMATION CONTACT: Hampton Newsome, (202) 326-2889,
Attorney, Division of Enforcement, Bureau of Consumer Protection,
Federal Trade Commission, Room M-8102B, 600 Pennsylvania Avenue NW.,
Washington, DC 20580.

SUPPLEMENTARY INFORMATION:

I. Background

The Commission issued the Fuel Economy Guide (16 CFR Part 259) in
1975 to prevent deceptive fuel economy advertising for new automobiles
and to facilitate the use of fuel economy information in advertising.
The Guide helps advertisers avoid unfair or deceptive claims under
Section 5 of the FTC Act. To accomplish this goal, the Guide advises
marketers to disclose established EPA fuel economy estimates (e.g.,
miles per gallon or ``mpg'') whenever they make any fuel economy claim
based on those estimates. In addition, 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 test's source, driving conditions, and vehicle
configurations.
On April 28, 2009 (74 FR 19148), the Commission published a Notice
of Proposed Rulemaking (``NPRM'') soliciting comments on proposed
amendments to the Guide. The Commission then postponed its Guide review
in a June 1, 2011 Notice (76 FR 31467) pending new fuel economy
labeling requirements from the EPA and completion of the FTC's
Alternative Fuel Rule (16 CFR Part 309) review. The Commission
explained that Fuel Economy Guide revisions would be premature before
the conclusion of these regulatory proceedings.
With these two activities now complete, the Commission resumes its
review of the Fuel Economy Guide with this document.\1\ The document
contains a discussion of the Guide's format and content, a brief
analysis of earlier comments received, and a discussion of several fuel
economy claims. The Commission seeks comments on these issues,
including issues it has raised in earlier documents, and any other
matter related to the Guide. Though this document contains several
proposed changes to the Guide, it does not present specific, proposed
text revisions. The Commission will wait and include, if warranted,
such specific language in a subsequent document after reviewing
comments and consumer research results.
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\1\ The Commission announced final revisions to the Alternative
Fuels Rule in an April 23, 2013 Final Rule (78 FR 23832). In 2011,
EPA completed revisions to its fuel economy labeling requirements,
which, among other things, addressed labels for alternative-fueled
vehicles (AFVs) not specifically addressed in past EPA requirements.
See 76 FR 39478 (July 6, 2011).
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In considering potential revisions to the FTC Guide, commenters
should focus on information that helps marketers avoid deceptive or
unfair claims prohibited by the FTC Act.\2\ The Guide is not intended
to identify disclosures that are merely helpful or desirable to
consumers. Likewise, commenters should not address the adequacy of EPA
fuel economy test procedures or the accuracy of EPA label content. Such
issues fall within the EPA's purview and the Commission generally
defers to that agency's technical expertise and statutory authority
over such matters and are

[[Page 27821]]

generally outside the scope of the Guide.
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\2\ 15 U.S.C. 45(a). The Guides do not have the force and effect
of law and are not independently enforceable. However, failure to
comply with industry guides may result in law enforcement action
under applicable statutory provisions. The Commission, therefore,
can take action under the FTC Act if a business makes fuel economy
claims inconsistent with the Guides. In any such enforcement action,
the Commission must prove that the act or practice at issue is
unfair or deceptive in violation of Section 5 of the FTC Act.
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II. Issues for Comment

The Commission seeks comment on several issues related to the Fuel
Economy Guide including some raised by earlier comments,\3\ and others
identified by the Commission based on recent EPA label changes. These
issues fall into two categories: General matters related to the Guide
review and specific fuel economy advertising claims.
---------------------------------------------------------------------------

\3\ In response to the 2009 document, the Commission received
eight comments from sources including the automobile manufacturing
industry, local government, and consumers groups. Comments are
available at: https://www.ftc.gov/os/comments/fueleconadguidepropamend/index.shtm. Generally, the comments
supported retention of the Guide and recognized its benefits.
---------------------------------------------------------------------------

A. General Matters for the Guide Review

As discussed below, the Commission seeks comment on general issues
related to the Guide including definitions, citation format, the
Guide's overall format, and consumer research.
1. Definitions
In its previous NPRM, the Commission proposed fives changes related
to the Guide's definitions section (16 CFR 259.1). The Commission
received no comments in response. The Commission again seeks comment on
these changes.\4\
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\4\ The Commission, in the 2009 NPRM, also proposed to add two
terms, ``Fuel'' and ``Alternative Fueled Vehicles,'' to distinguish
the vehicles that would be covered by the guidance for the EPA label
requirements from those covered by the proposed guidance regarding
alternative fueled vehicles. 74 FR 19148.
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First, the Commission proposes to replace several outdated terms in
the Guide to ensure they are consistent with those in EPA's current
fuel economy rules.\5\ Specifically, the definition ``Estimated city
mpg.'' would change to ``Estimated city fuel economy''; ``Estimated
highway mpg.'' would change to ``Estimated highway fuel economy''; and
the term ``fuel economy'' would change to refer to a vehicle's ``fuel
efficiency.'' In addition, the Commission proposes to eliminate the
term ``estimated in-use fuel economy range'' because EPA's fuel economy
label no longer provides such information.\6\
---------------------------------------------------------------------------

\5\ See 40 CFR 600.002.
\6\ See 16 CFR 259.1(e) (definition of ``estimated in-use fuel
economy range'').
---------------------------------------------------------------------------

Second, the Commission proposes to add the term ``Combined fuel
economy'' to Section 259.1 of the Guide to ensure consistency and
reduce potential confusion because EPA now uses this term on its
label.\7\ Consistent with EPA requirements,\8\ the Commission proposes
to 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.'' \9\ The new term
would expand the Commission's guidance to marketers whose vehicles now
display combined fuel economy estimate information required by the EPA.
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\7\ See 40 CFR 600, Appendix VI.
\8\ See 40 CFR 600.206-12.
\9\ The Commission proposes to adopt EPA's definition for the
term. See 71 FR 77872, 77927 (Dec. 27, 2006).
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Third, the Commission proposes to amend the Guide's definition of
``new automobile'' to incorporate changes made to the EPA's fuel
labeling requirements. The EPA's rules require vehicle manufacturers to
display a fuel economy label for a new class of vehicles, ``medium-duty
passenger vehicles.'' \10\ To conform with EPA's change, the Commission
plans to augment the definition of ``new automobile'' to include
``medium-duty passenger vehicle'' as one of the classes of vehicles
covered by the Fuel Economy Guide.
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\10\ 40 CFR 86.1803-01. Previously, the EPA required fuel
economy labels for only passenger automobiles and light trucks.
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Fourth, the Commission proposes several minor revisions including
an amendment to the definition of ``range of fuel economy'' to
eliminate the phrase ``in use,'' and changes to the definitions for
``estimated city mpg'' and ``estimated highway mpg'' to ensure
consistency with the terms and definitions used by the EPA. The
Commission also proposes to eliminate an obsolete reference to the term
``unique nameplate'' in footnote 2 of the Guide and replace it with the
more appropriate EPA term ``model type.'' \11\
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\11\ 77 FR 77928.
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Finally, the Commission proposes to reorganize the definition of
``new automobile'' to reduce the definition's length and potential
confusion. Specifically, the proposed amendment would remove the
definitions ``dealer,'' ``manufacturer,'' and ``ultimate purchaser''
from ``new automobile'' and list them as separate terms under section
259.1.\12\
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\12\ The definitions for ``dealer,'' ``manufacturer,'' and
``ultimate purchaser'' have not been altered in any other way.
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2. Regulatory Citations
In its previous NPRM, the FTC proposed to replace all specific
regulatory citations to EPA regulations in the Guide with general
citations (40 CFR Part 600) to reduce the frequency of future Guide
changes should EPA amend its regulations. In comments, the Association
of International Automobile Manufacturers, Inc. (``AIAM'') noted that
this proposal would create confusion because the general EPA provisions
cited in the proposal contain two different sets of fuel economy
requirements, one of which is not directly applicable to FTC's Guide.
To avoid such confusion, the Commission no longer plans to use general
citations in the Guide.
3. Guide Format
The Commission also proposes to improve the Guide's format to
ensure consistency with other recently amended FTC guides, such as the
Guides For the Use of Environmental Marketing Claims.\13\ Under this
format, the revised Guide would contain a list of general principles to
help marketers avoid deceptive practices, coupled with specific sample
claims to illustrate those principles. This format, with its detailed
examples, places the general principles in a useful context for
marketers and helps readers locate relevant information. In addition,
the sample claims frame the general principles in a clear context, thus
improving understanding of the Guide. The Commission seeks comment on
such an approach, including, as discussed in more detail below, the
types of claims that the Guide should feature.
---------------------------------------------------------------------------

\13\ See Guides for the Use of Environmental Marketing Claims
(``Green Guides'') (16 CFR Part 260); Guides Concerning the Use of
Endorsements and Testimonials in Advertising (16 CFR Part 255).
---------------------------------------------------------------------------

4. Consumer Research
The Commission plans to conduct consumer research to enhance the
Commission's understanding of how consumers understand fuel economy
advertising claims. In particular, the Commission plans to explore
several common advertising claims, such as general fuel economy claims,
unqualified or minimally qualified mpg disclosures, and claims for
vehicle driving range based on non-EPA test procedures. The FTC and its
contractor will administer questions to the respondents online over the
Internet. The study will employ standard consumer survey methodologies,
such as choice experiments, to explore how different claims affect
consumer decision-making. The Commission will

[[Page 27822]]

provide more detail regarding the study in a separate document.

B. Types of Fuel Economy Claims

As discussed in detail below, the Commission seeks comment on
specific types of advertising claims, including EPA-based miles-per-
gallon claims, claims based on non-EPA tests, claims related to vehicle
configuration, range of fuel economy claims, and alternative fueled
vehicle claims.
1. EPA Miles-Per-Gallon Claims
The Commission seeks comment on the Guide's current provisions for
mpg claims (section 259.2(a)). The current Guide states that any
express or implied fuel economy claim must be accompanied by a
corresponding EPA fuel economy rating (i.e., EPA mpg number) matching
the representation. For example, if an advertisement contains a city-
related representation (e.g., ``XYC car gets great mileage in the
city''), the Guide advises the advertiser to disclose the vehicle's EPA
city mileage rating.\14\
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\14\ The Guide does not direct marketers to provide both highway
and city ratings unless the advertisement contains fuel economy
claims related to both city and highway performance. Where a fuel
economy claim does not specify highway or city performance (e.g.,
``XYZ car gets great mileage''), the Guide indicates that the
marketer should disclose the vehicle's city mpg. The Guide also
advises marketers to state that EPA is the source of the mpg ratings
and that such ratings are estimates.
---------------------------------------------------------------------------

In the NPRM, the Commission noted that EPA's labeling rule now
requires manufacturers to disclose a ``combined'' fuel economy
estimate, in addition to city and highway estimates, on the fuel
economy label.\15\ Accordingly, consistent with guidance for highway
and city ratings, the proposed amendments advised advertisers to
disclose an EPA combined fuel economy estimate for any representation
related to combined fuel economy.\16\
---------------------------------------------------------------------------

\15\ 74 FR 19149.
\16\ 74 FR 19150. Section 259.2(a) does not prohibit disclosure
of both the city and highway estimates. For example, a manufacturer
could display the EPA's city and highway economy estimate in a print
advertisement for a vehicle. Alternately, the same company could
display only the EPA's combined fuel economy estimate in a
television advertisement for the same vehicle and still comply with
the current Guide.
---------------------------------------------------------------------------

In response, commenters raised several concerns about the current
guidance for mpg claims. First, two commenters insisted that both city
and highway fuel economy estimates must appear in all advertisements
because such estimates are material to consumers' purchasing
decisions.\17\ Second, comments suggested that disclosure of a single
mpg rating (e.g., highway mileage only) overstates the actual fuel
economy for some contexts and that, regardless of the presence of
qualifying language, consumers will expect a vehicle to attain the
advertised mileage.\18\ Furthermore, Public Citizen and other consumer
group commenters expressed concern that manufacturers advertise only
the most favorable fuel economy estimates for their vehicles.\19\
Finally, another commenter suggested that only the combined city and
highway fuel economy rating be allowed in advertising.\20\
---------------------------------------------------------------------------

\17\ Montgomery County, Maryland, Office of Consumer Protection
(541056-00007) (``Montgomery County''); Public Citizen, the
Center for Auto Safety, and the Safe Climate Campaign
(541056-00009) (``Public Citizen''). Public Citizen
proposed that both city and highway estimates be displayed and that
the city fuel economy be expressed in larger text than the highway
fuel economy. Montgomery County further suggested that the Guide
adopt a comparative fuel economy scale, ``similar to the 0-10 scale
for air pollution provided by the EPA.''
\18\ Public Citizen; Montgomery County. Montgomery County argued
that disclosing only one fuel economy rating could be misleading to
consumers with hybrid vehicles: ``Unlike traditional autos . . .
hybrids often receive higher city than highway ratings. . . . [M]any
consumers, familiar with EPA estimates, look at the high city
estimate in a hybrid ad and conclude, based on past experience, that
the unstated highway mileage must be even higher.'' Montgomery
County at 2.
\19\ Public Citizen.
\20\ Consumer Federation of America et al. (``CFA'')
(541056-00006).
---------------------------------------------------------------------------

The Commission seeks comments on various aspects of the mpg
provision of the current Guide (section 259.2(a)). Commenters should
limit their comments to addressing deceptive and unfair claims under
the FTC Act and should not recommend guidance, including affirmative
disclosures, merely because such information would help consumer
purchasing decisions. Among other things, the Commission seeks comments
on: (1) Whether a general fuel economy claim (e.g., ``XYZ car gets
great mileage'') should be accompanied by a specific mpg disclosure to
prevent consumer deception or unfairness; (2) whether an advertisement
is unfair or deceptive if it provides only one type of mileage rating
(e.g., an advertisement that only provides highway mpg); (3) whether an
unspecified mpg claim (e.g., ``37 mpg'') is deceptive if the
advertisement fails to identify whether the rating is city, highway, or
combined; (4) how consumers understand ``up to'' mpg claims, which
sometimes appear in ads (e.g., ``up to 45 mpg''); (5) whether the
combined EPA mpg rating should serve as the default disclosure for
unspecified fuel economy claims (instead of the city mpg as currently
indicated in the Guide); (6) whether the Guide should advise marketers
to avoid statements that imply a linear relationship between mpg and
fuel costs; (7) whether fuel economy advertisements containing mpg
claims should identify EPA as the source of the ratings; and (8)
whether FTC should provide additional guidance regarding disclaimers
that the EPA ratings are only estimates.
2. Claims Based on Non-EPA Estimates
The Commission is also considering whether the Guide's provisions
for advertising claims based on non-EPA tests should be updated.
Section 259.2(c) advises that advertisers may make fuel economy claims
based on non-EPA information only if 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.
In response to the NPRM, the comments offered conflicting views on
this guidance. Some consumer groups urged the FTC to prohibit
altogether any non-EPA fuel economy estimate in advertising because
such estimates may thwart consumers' efforts to compare vehicle fuel
economy.\21\ The Council of Better Business Bureaus (``BBB'') supported
the current Guide's non-EPA claim provision explaining that it gives
advertisers the flexibility to advertise legitimate fuel efficiency
claims while still permitting fair comparisons with other vehicles.
---------------------------------------------------------------------------

\21\ CFA stated that despite required source disclosures, non-
EPA information would, ``[a]t the worst . . . mislead consumers; at
the best, simply confuse them and prevent them from using advertised
rating information comparatively.'' Public Citizen shared the CFA's
concerns and further stated that, ``Allowing a non-EPA derived
estimate does not have any consumer utility . . . [and] the
existence of two different fuel economy rating systems in fuel
economy advertisements can only create consumer confusion and
mistrust for the reliability of both . . . '' Public Citizen at 4.
---------------------------------------------------------------------------

The Commission seeks further comment on this issue. Commenters
should address, among other things, the prevalence of non-EPA fuel
economy claims, including both traditional fuel economy claims (e.g.,
mpg) as well as electric vehicle driving range claims (e.g., ``100
miles per charge''); and the adequacy of the current guidance for
preventing deception.
3. Claims Related to Model Groups
The current Guide advises manufacturers to limit fuel economy
ratings to the corresponding model type to ensure advertised fuel
economy ratings match the advertised vehicles specification, citing EPA
requirements for vehicle configuration (40 CFR

[[Page 27823]]

600.207).\22\ Specifically, section 259.2, n. 2 of the Guide warns
against using a single fuel economy estimate for all vehicles bearing a
common model name, if separate vehicles within that model group have
different fuel economy ratings.\23\
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\22\ The EPA's fuel economy regulations define model type as ``a
unique combination of car line, basic engine, and transmission
class'' 40 CFR 600.002-85 (emphasis added.)
\23\ Section 259.2, n. 2 states that the ``estimated city mpg''
and the ``estimated highway mpg'' must be those applicable to the
specific nameplate being advertised. Fuel economy estimates assigned
to ``unique nameplates'' apply only to such unique car lines. As
discussed earlier in this document, the Commission also proposes to
eliminate 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.''
---------------------------------------------------------------------------

Addressing this issue, two commenters argued that the Guide should
require all advertisements to disclose the model year and the vehicle
configuration tested.\24\ Public Citizen noted that the current Guide
would allow the ``highest fuel economy vehicle configuration of one
model to be applied to all vehicle configurations of that model.'' \25\
The BBB noted that, in some advertising, marketers fail to identify
``the specific vehicle variables affecting a vehicle's fuel economy not
specified (e.g., automatic or standard transmission, engine size, four
wheel drive versus front wheel drive, etc.).''
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\24\ BBB; Public Citizen.
\25\ Public Citizen. Similarly, Montgomery County offered
several examples of noncompliant advertising as further proof that
failing to disclose the vehicle configuration to which the estimates
apply is deceptive.
---------------------------------------------------------------------------

The Commission seeks further comment on this issue. Among other
things, the Commission invites commenters to address whether the FTC
should provide further guidance to help advertisers avoid deceptive
claims in this context.
4. Claims for Alternative Fueled Vehicles
In the NPRM, the Commission proposed disclosure requirements for
vehicles covered by the FTC's Alternative Fuels Rule (16 CFR Part
309).\26\ The proposed amendment mirrored the Guide's other provisions
by advising marketers to advertise estimated cruising ranges determined
under the Alternative Fuels Rule as well as non-FTC sources. In
advertisements that display non-FTC derived estimates, the proposal
advised advertisers to: (1) Display the estimated cruising range
required on the FTC label more prominently than any other estimate; (2)
disclose the source of the cruising range estimate; and (3) display any
material differences between the method used and the method required by
the FTC's labeling rule.\27\
---------------------------------------------------------------------------

\26\ 77 FR 19152.
\27\ The Commission also proposed adding two terms, ``Fuel'' and
``Alternative Fueled Vehicles,'' to distinguish the vehicles that
would be covered by the guidance for the EPA label requirements from
those covered by the proposed guidance regarding alternative fueled
vehicles. The NPRM defined ``Fuel'' to include gasoline and diesel
fuel, electrical energy, alcohol, and natural gas. The NPRM also
defined ``Alternative Fueled Vehicle'' to cover any vehicle that
qualifies as a covered vehicle under 16 CFR Part 309. This term
covers any vehicle designed to operate solely on an alternative
fuel, or dual-fuel such as ethanol, natural gas, liquefied petroleum
gas, hydrogen, coal-derived fuel, fuels from biological materials,
electricity, or other fuels determined by the secretary to yield
substantial security and environmental benefits.
---------------------------------------------------------------------------

Commenters raised several issues with the proposed amendments. Some
argued that the numerous inconsistencies in EPA and FTC standards and
calculations for AFVs would render any prospective guidance confusing
and ineffective.\28\ Another group of commenters recommended guidance
about alternative fueled vehicles that also use gasoline (i.e.,
flexible fueled vehicles (FFV)).\29\ In particular, these comments
noted that many FFVs have one fuel economy rating for gasoline and
another for alternative fuel operation. They recommended disclosure of
fuel economy estimates for every allowable fuel a vehicle may use. They
also urged additional disclosures to reduce consumer confusion and
raise awareness that alternative fueled vehicles may operate more
efficiently on gasoline than on alternative fuel.
---------------------------------------------------------------------------

\28\ See, e.g., Alliance of Automobile Manufacturers
(541056-00002).
\29\ See Public Citizen.
---------------------------------------------------------------------------

In April 2013, the Commission amended the Alternative Fuels Rule to
consolidate the FTC's alternative fueled vehicle labels with EPA's new
fuel economy labels.\30\ Because those amendments removed any potential
conflict between FTC and EPA labels, there is no need for information
in the Guide related to FTC alternative fueled vehicles labels.
---------------------------------------------------------------------------

\30\ 78 FR 23832 (April 23, 2013).
---------------------------------------------------------------------------

Nonetheless, the Commission seeks additional comment on whether the
Guide should address advertising for FFVs, particularly as it pertains
to different fuel economy estimates for different fuels. Specifically,
commenters should address whether advertisements that provide a
vehicle's gasoline mpg rating and identify the vehicle as an FFV should
also disclose that vehicle's alternative fuel mpg rating. In addressing
this issue, commenters should indicate whether such ads are common and
whether FTC guidance would help marketers avoid deceptive claims.
5. Fuel Economy Range Claims
Section 259.2(b)(1) addresses ``estimated in-use fuel economy
range'' claims (e.g., ``expected range for most drivers 15 to 21
mpg''). Because EPA's revised label no longer contains this information
and no evidence suggests such claims are prevalent in the market, the
Commission proposes to eliminate that specific provision from the
Guide. At this time, the Commission does not propose to eliminate
section 259.2(b)(2), which addresses range information for automobile
classes (e.g., ``Small SUVs range from 16 to 32 mpg'').

III. Request for Comments

You can file a comment online or on paper. For the Commission to
consider your comment, we must receive it on or before July 10, 2014.
Write ``Fuel Economy Guide, R711008'' on your comment. Your comment--
including your name and your state--will be placed on the public record
of this proceeding, including, to the extent practicable, on the public
Commission Web site, at https://www.ftc.gov/os/publiccomments.shtm. As a
matter of discretion, the Commission tries to remove individuals' home
contact information from comments before placing them on the Commission
Web site.
Because your comment will be made public, you are solely
responsible for making sure that your comment does not include any
sensitive personal information, such as anyone'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. You are also
solely responsible for making sure that your comment does not include
any sensitive health information, such as medical records or other
individually identifiable health information. In addition, do not
include any ``[t]rade secret or any commercial or financial information
which is . . . privileged or confidential,'' as discussed in Section
6(f) of the FTC Act, 15 U.S.C. 46(f), and FTC Rule 4.10(a)(2), 16 CFR
4.10(a)(2). In particular, do not include competitively sensitive
information such as costs, sales statistics, inventories, formulas,
patterns, devices, manufacturing processes, or customer names.
If you want the Commission to give your comment confidential
treatment, you must file it in paper form, with a request for
confidential treatment, and you have to follow the procedure

[[Page 27824]]

explained in FTC Rule 4.9(c), 16 CFR 4.9(c).\31\ Your comment will be
kept confidential only if the FTC General Counsel grants your request
in accordance with the law and the public interest.
---------------------------------------------------------------------------

\31\ In particular, the written request for confidential
treatment that accompanies the comment must include the factual and
legal basis for the request, and must identify the specific portions
of the comment to be withheld from the public record. See FTC Rule
4.9(c), 16 CFR 4.9(c).
---------------------------------------------------------------------------

Postal mail addressed to the Commission is subject to delay due to
heightened security screening. As a result, we encourage you to submit
your comments online. To make sure that the Commission considers your
online comment, you must file it at https://ftcpublic.commentworks.com/ftc/fueleconomyguide, by following the instruction on the web-based
form. If this Notice appears at https://www.regulations.gov, you also
may file a comment through that Web site.
If you file your comment on paper, write ``Fuel Economy Guide,
R711008'' on your comment and on the envelope, and mail it to the
following address: Federal Trade Commission, Office of the Secretary,
600 Pennsylvania Avenue NW, Suite CC-5610, (Annex O), Washington, DC
20580, or deliver your comment to the following address: Federal Trade
Commission, Office of the Secretary, Constitution Center, 400 7th
Street SW., 5th Floor, Suite 5610, (Annex O), Washington, DC 20024. If
possible, submit your paper comment to the Commission by courier or
overnight service.
Visit the Commission Web site at https://www.ftc.gov to read this
NPRM and the News Release describing this proceeding. The FTC Act and
other laws that 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 on or before July 10, 2014. You can find more
information, including routine uses permitted by the Privacy Act, in
the Commission's privacy policy, at https://www.ftc.gov/ftc/privacy.htm.

By direction of the Commission.
Donald S. Clark,
Secretary.
[FR Doc. 2014-10889 Filed 5-14-14; 8:45 am]
BILLING CODE 6750-01-P

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