Reports, Forms, and Recordkeeping Requirements, 60789-60795 [2017-27635]

Agencies

• National Highway Traffic Safety Administration
• DEPARTMENT OF TRANSPORTATION

[Federal Register Volume 82, Number 245 (Friday, December 22, 2017)]
[Notices]
[Pages 60789-60795]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2017-27635]


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DEPARTMENT OF TRANSPORTATION

National Highway Traffic Safety Administration

[U.S. DOT Docket Number NHTSA-2016-0065]


Reports, Forms, and Recordkeeping Requirements

AGENCY: National Highway Traffic Safety Administration (NHTSA), U.S. 
Department of Transportation.

ACTION: Notice.

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SUMMARY: In compliance with the Paperwork Reduction Act of 1995, this 
notice announces that the Information Collection Request (ICR) 
abstracted below has been forwarded to the Office of Management and 
Budget (OMB) for review and comment. The ICR describes the nature of 
the information collections and their expected burden. The Federal 
Register Notice with a 60-day comment period was published on October 
2, 2017.

DATES: Comments must be submitted to OMB on or before January 22, 2018.

ADDRESSES: Send comments to the Office of Information and Regulatory 
Affairs, OMB, 725 17th Street NW, Washington, DC 20503.

FOR FURTHER INFORMATION CONTACT: Stephen Hench, Office of Chief Counsel 
(NCC-0100), Room W41-229, NHTSA, 1200 New Jersey Avenue SE, Washington, 
DC 20590. Telephone: 202.366.2992.

SUPPLEMENTARY INFORMATION: Under the Paperwork Reduction Act of 1995, 
before an agency submits a proposed collection of information to OMB 
for approval, it must first publish a document in the Federal Register 
providing a 60-day comment period and otherwise consult with members of 
the public and affected agencies concerning each proposed collection of 
information. The OMB has promulgated regulations describing what must 
be included in such a document. Under OMB's regulation, see 5 CFR 
1320.8(d), an agency must ask for public comment on the following:
    (i) Whether the proposed collection of information is necessary for 
the proper performance of the functions of the agency, including 
whether the information will have practical utility;
    (ii) the accuracy of the agency's estimate of the burden of the 
proposed collection of information, including the validity of the 
methodology and assumptions used;
    (iii) how to enhance the quality, utility, and clarity of the 
information to be collected; and
    (iv) how to minimize the burden of the collection of information on 
those who are to respond, including the use of appropriate automated, 
electronic, mechanical, or other technological collection techniques or 
other forms of information technology, e.g., permitting electronic 
submission of responses.
    In compliance with these requirements, NHTSA asks for public 
comments on the following collection of information:
    Title: Defect and Noncompliance Reporting and Notification.
    Type of Request: Renewal of a currently approved information 
collection.
    OMB Control Number: 2127-0004.
    Affected Public: Businesses or individuals.
    Abstract: The 60-day notice for this information collection 
received four (4) comments. Two of these comments were anonymously 
submitted and discuss issues unrelated to this information collection 
(a SEC rule, and global temperature changes). One of these comments, 
submitted by Gary and Sherry Buckingham, queries: ``Where and when will 
we know to get our air bags from Takata fixed?'' Vehicle manufacturers 
are required to mail letters to vehicle owners notifying them

[[Page 60790]]

when a remedy is available and how to obtain the free remedy. 
Additionally, individuals may consult NHTSA's Takata Recall Spotlight 
website (https://www.nhtsa.gov/recall-spotlight/takata-air-bags), and 
utilize NHTSA's VIN Look-Up Tool (available at https://www.nhtsa.gov/recalls), to obtain information including how the recalls may affect 
their specific vehicle(s). The final comment received was submitted by 
the Alliance of Automobile Manufacturers (Alliance) and the Association 
of Global Automakers (Global Automakers) (hereinafter collectively 
``Alliance & Global''). Alliance & Global offered comments on estimates 
related to safety recall reporting and owner notification obligations, 
as well as estimates related to manufacturer obligations under the 
Takata Coordinated Remedy Program. A summary of these comments is below 
with the corresponding burden estimates, along with the agency's 
response.
    This collection covers the information collection requirements 
found within various statutory sections in the Motor Vehicle Safety Act 
of 1966 (Act), 49 U.S.C. 30101, et seq., that address and require 
manufacturer notifications to NHTSA of safety-related defects and 
failures to comply with Federal Motor Vehicle Safety Standards (FMVSS) 
in motor vehicles and motor vehicle equipment, as well as the provision 
of particular information related to the ensuing owner and dealers 
notifications and free remedy campaigns that follow those 
notifications. The sections of the Act imposing these requirements 
include 49 U.S.C. 30118, 30119, 30120, and 30166. Many of these 
requirements are implemented through, and addressed with more 
specificity in, 49 CFR part 573, Defect and Noncompliance 
Responsibility and Reports (Part 573) and 49 CFR 577, Defect and 
Noncompliance Notification (Part 577).
    Pursuant to the Act, motor vehicle and motor vehicle equipment 
manufacturers are obligated to notify, and then provide various 
information and documents to, NHTSA in the event a safety defect or 
noncompliance with Federal Motor Vehicle Safety Standards (FMVSS) is 
identified in products they manufactured. See 49 U.S.C. 30118(b) and 49 
CFR 573.6. Manufacturers are further required to notify owners, 
purchasers, dealers, and distributors about the safety defect or 
noncompliance. See 49 U.S.C. 30118(b), 30120(a); 49 CFR 577.7, 577.13. 
Manufacturers are required to provide to NHTSA copies of communications 
pertaining to recall campaigns that they issue to owners, purchasers, 
dealers, and distributors. See 49 U.S.C. 30166(f); 49 CFR 573.6(c)(10).
    Manufacturers are also required to file with NHTSA a plan 
explaining how they intend to reimburse owners and purchasers who paid 
to have their products remedied before being notified of the safety 
defect or noncompliance, and explain that plan in the notifications 
they issue to owners and purchasers about the safety defect or 
noncompliance. See 49 U.S.C. 30120(d) and 49 CFR 573.13. Manufacturers 
are further required to keep lists of the respective owners, 
purchasers, dealers, distributors, lessors, and lessees of the products 
determined to be defective or noncompliant and involved in a recall 
campaign, and are required to provide NHTSA with a minimum of six 
quarterly reports reporting on the progress of their recall campaigns. 
See 49 CFR 573.8 and 573.7, respectively.
    In addition, in an enforcement action, certain manufacturers may be 
required by administrative order to conduct supplemental recall 
communications utilizing non-traditional means (e.g., text messaging, 
social media) crucial to achieving completion of a unique, large-scale 
recall. Presently, NHTSA is overseeing manufacturer recalls of 
unprecedented complexity involving Takata air bag inflators, where it 
has required such supplemental owner communications.\1\
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    \1\ See ``Notice of Coordinated Remedy Program Proceeding for 
the Replacement of Certain Takata Air Bag Inflator,'' available at 
https://www.regulations.gov/docket?D=NHTSA-2015-0055.
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    The Act and Part 573 also contain numerous information collection 
requirements specific to tire recall and remedy campaigns. These 
requirements relate to the proper disposal of recalled tires, including 
a requirement that the manufacturer conducting the tire recall submit a 
plan and provide specific instructions to certain persons (such as 
dealers and distributors) addressing that disposal, and a requirement 
that those persons report back to the manufacturer certain deviations 
from the plan. See 49 U.S.C. 30120(d) and 49 CFR 573.6(c)(9). The 
regulations also require that manufacturers report to NHTSA intentional 
and knowing sales or leases of defective or noncompliant tires.
    49 U.S.C. 30166(n) and its implementing regulation found at 49 CFR 
573.10 mandate that anyone who knowingly and willfully sells or leases 
for use on a motor vehicle a defective tire or a tire that is not 
compliant with FMVSS, and with actual knowledge that the tire 
manufacturer has notified its dealers of the defect or noncompliance as 
required under the Act, is required to report that sale or lease to 
NHTSA no more than five working days after the person to whom the tire 
was sold or leased takes possession of it.
    Estimated Burden: The existing information collection associated 
with 49 CFR part 573 and portions of 49 CFR part 577 currently has an 
estimated annual burden of 36,070 hours associated with an estimated 
275 respondents per year.\2\ Our prior estimates of the burden hours 
and cost associated with the requirements currently covered by this 
information collection require adjustment as follows.
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    \2\ See 81 FR 70269 (October 11, 2016).
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    Based on current information, we estimate 274 distinct 
manufacturers filing an average of 963 part 573 Safety Recall Reports 
each year. This is a change from our previous estimate of 854 part 573 
Safety Recall Reports filed by 275 manufacturers each year. In 
addition, with reference to the metric associated with NHTSA's VIN 
Look-up Tool regulation, see 49 CFR 573.15, we estimate it takes the 17 
major passenger-vehicle manufacturers (that each produce more than 
25,000 vehicles annually) more burden hours to complete these Reports 
to NHTSA. See 81 FR 70270 (October 11, 2016). Between 2014 and 2016, 
the major passenger-vehicle manufacturers collectively conducted an 
average of 299 recalls annually.
    We estimate that maintenance of the required owner, purchaser, 
dealer, and distributor lists requires 8 hours a year per manufacturer. 
Alliance & Global commented that it was unclear what this task 
involves, but that ``[i]f it includes obtaining the data and curating 
it for accuracy on a weekly or biweekly basis, this estimate is far too 
low.'' Without more information, it is difficult for NHTSA to revise 
its estimate in light of this comment. However, we note that this list 
maintenance involves tasks necessary to ensure a company has accurate 
records (e.g., names and addresses) of owners, purchasers, dealers, and 
distributors for use in discharging recall-notification obligations 
under 49 CFR parts 573 and 577, and that the amount of data and nature 
of information curation will vary from manufacturer to manufacturer. 
NHTSA continues to estimate at this time that maintenance of the 
required owner, purchaser, dealer, and distributors lists requires 8 
hours a year per manufacturer.
    We estimated that it takes a major passenger-vehicle manufacturer 
20 burden hours, on average, to prepare and file their Part 573 
Reports. In a

[[Page 60791]]

previous agency response to prior comments from Nissan North America, 
Inc. (Nissan), we acknowledged that major passenger-vehicle 
manufacturers may require more burden hours to file these reports, and 
agreed with Nissan's estimate of 20 burden hours for this requirement. 
See 81 FR 70270 (October 11, 2016). Alliance & Global here provide 
further input on this metric as it bears on major passenger-vehicle 
manufacturers, commenting that as a ``best fit'' of information 
collected from its member companies, its members spend 40 hours 
completing each Part 573 Recall Report. NHTSA repeats its observations 
that most manufacturers who conduct safety recalls are not major 
passenger-vehicle manufacturers, and that most other manufacturers 
include very few products in the average safety recall. NHTSA further 
observes that many members of the Alliance & Global are major 
passenger-vehicle manufacturers, and that therefore its comments are 
more representative of, and applicable to the burdens for, such 
manufacturers. NHTSA thanks the Alliance & Global for its comment, and 
now estimates that the major passenger-vehicle manufacturers will 
require 40 burden hours to prepare and file their Part 573 Recall 
Reports. NHTSA continues to estimate it takes all other manufacturers 4 
hours to prepare and file their Part 573 Recall Reports.
    Accordingly, we estimate the annual burden hours related to the 
reporting to NHTSA of a safety defect or noncompliance for the 17 major 
passenger vehicle-manufacturers to be 11,960 hours annually (299 
notices x 40 hours/report), and that all other manufacturers require a 
total of 2,656 hours annually (664 notices x 4 hours/report) to file 
their notices. Accordingly, the estimated annual burden hours related 
to the reporting to NHTSA of a safety defect or noncompliance is 16,808 
hours (11,960 hours + 2,656 hours) + (274 MFRs x 8 hours to maintain 
purchaser lists).\3\
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    \3\ For more information about how we derived these and certain 
other estimates please see 81 FR 70269 (October 11, 2016).
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    We estimate that an additional 40 hours will be needed to account 
for major passenger-vehicle manufacturers adding details to Part 573 
Safety Recall Reports relating to the intended schedule for notifying 
its dealers and distributors, and tailoring its notifications to 
dealers and distributors in accordance with the requirements of 49 CFR 
577.13. For all other manufacturers, an additional 2 hours will be 
needed to account for this obligation. This burden is estimated at 
13,288 hours annually (664 notices x 2 hours/notification) + (299 
notices x 40 hours/notification).
    49 U.S.C. 30166(f) requires manufacturers to provide the Agency 
copies of all communications regarding defects and noncompliances sent 
to owners, purchasers, and dealerships. Manufacturers must index these 
communications by the year, make, and model of the vehicle as well as 
provide a concise summary of the subject of the communication. We 
estimated this burden requires 30 minutes for each vehicle recall. 
Alliance & Global commented that as a ``best fit'' of information 
collected from its member companies, its members spend 3 hours per 
recall on this requirement. NHTSA does acknowledge that its previous 
estimate could have been low, particularly in the case of larger 
recalls involving a diverse group of vehicle years, makes, and models, 
which Alliance & Global members may face more frequently than smaller 
manufacturers. Accordingly, NHTSA now estimates this burden to be 3 
hours for the 17 major passenger-vehicle manufacturers. This totals an 
estimated 1,229 hours annually (299 recalls x 3 hours for the 17 major 
passenger-vehicle manufacturers) + (664 recalls x .5 for all other 
manufacturers).
    In the event a manufacturer supplied the defective or noncompliant 
product to independent dealers through independent distributors, that 
manufacturer is required to include in its notifications to those 
distributors an instruction that the distributors are to then provide 
copies of the manufacturer's notification of the defect or 
noncompliance to all known distributors or retail outlets further down 
the distribution chain within five working days. See 49 CFR 
577.7(c)(2)(iv). As a practical matter, this requirement would only 
apply to equipment manufacturers since vehicle manufacturers generally 
sell and lease vehicles through a dealer network, and not through 
independent distributors. We believe our previous estimate of 95 
equipment recalls per year needs to be adjusted to 87 equipment recalls 
per year to better reflect recent data. Although distributors are not 
required to follow that instruction, we expect that they will, and have 
estimated the burden associated with these notifications (identifying 
retail outlets, making copies of the manufacturer's notice, and 
mailing) to be 5 hours per recall campaign. Assuming an average of 3 
distributors per equipment item, (which is a liberal estimate given 
that many equipment manufacturers do not use independent distributors) 
the total number of burden hours associated with this third-party 
notification burden is approximately 1,305 hours per year (87 recalls x 
3 distributors x 5 hours).
    As for the burden linked with a manufacturer's preparation of and 
notification concerning its reimbursement for pre-notification 
remedies, we estimated that the preparation of a reimbursement plan 
takes approximately 4 hours annually, an additional .5 hours is spent 
tailoring each plan to particular defect and noncompliance 
notifications to NHTSA and adding tailored language about the plan to a 
particular safety recall's owner notification letters, and an 
additional 12 hours annually is spent disseminating plan information. 
Alliance & Global commented that as a ``best fit'' of information 
collected from its member companies, its members spend 1.5 hours, 
instead of .5 hours, tailoring reimbursement plans for a given recall.
    NHTSA appreciates Alliance & Global's comment, and acknowledges 
that its previous estimate could have been low, particularly in the 
case of larger recalls involving a diverse group of vehicle years, 
makes, and models, which Alliance & Global members may face more 
frequently than smaller manufacturers. NHTSA now estimates this burden 
to be 1 hour for the 17 major passenger-vehicle manufacturers. 
Incorporating this revision, for this burden NHTSA estimates a total 
5,165 annual hours (274 MFRs x 4 hours to prepare plan) + [(299 recalls 
x 1.5 hours tailoring plan for each recall for 17 major passenger-
vehicle manufacturers) + (664 recalls x .5 tailoring plan for all other 
manufacturers)] + (274 MFRs x 12 hours to disseminate plan 
information)).
    The Safety Act and 49 CFR part 573 also contain numerous 
information collection requirements specific to tire recall and remedy 
campaigns, as well as a statutory and regulatory reporting requirement 
that anyone who knowingly and intentionally sells or leases a defective 
or noncompliant tire notify NHTSA of that activity.
    Manufacturers are required to include specific information related 
to tire disposal in the notifications they provide NHTSA concerning 
identification of a safety defect or noncompliance with FMVSS in their 
tires, as well as in the notifications they issue to their dealers or 
other tire outlets participating in the recall campaign. See 49 CFR 
573.6(c)(9). We estimate that the agency administers 12 tire recalls 
each year, on average. We estimate that the inclusion of this 
additional information will require an additional two hours of effort 
beyond the subtotal above associated with non-tire recall

[[Page 60792]]

campaigns. This additional effort consists of one hour for the NHTSA 
notification and one hour for the dealer notification for a total of 24 
burden hours (12 tire recalls a year x 2 hours per recall).
    Manufacturer-owned or controlled dealers are required to notify the 
manufacturer and provide certain information should they deviate from 
the manufacturer's disposal plan. Consistent with our previous 
analysis, we ascribe zero burden hours to this requirement since to 
date no such reports have been provided and our original expectation 
that dealers would comply with manufacturers' plans has proven true.
    Accordingly, we estimate 24 burden hours a year will be spent 
complying with the tire recall campaign requirements found in 49 CFR 
573.6(c)(9).
    The agency recently received one report under 49 U.S.C. 30166(n) 
and its implementing regulation at 49 CFR 573.10 of a defective or 
noncompliant tire being intentionally sold or leased, so our previous 
estimate of zero burden hours for this regulatory requirement is being 
revised. The agency estimates 1 burden hour annually will be spent 
preparing and submitting such reports.
    We continue to believe nine vehicle manufacturers, who did not 
operate VIN-based recalls lookup systems prior to August 2013, incur 
certain recurring burdens on an annual basis. We continue to estimate 
that 100 burden hours will be spent on system and database 
administrator support. These 100 burden hours include: Backup data 
management and monitoring; database management, updates, and log 
management; and data transfer, archiving, quality assurance, and 
cleanup procedures. We estimate another 100 burden hours will be 
incurred on web/application developer support. These burdens include: 
Operating system and security patch management; application/web server 
management; and application server system and log files management. We 
estimate these burdens will total 1,800 hours each year (9 MFRs x 200 
hours). We estimate the recurring costs of these burden hours will be 
$30,000 per manufacturer.\4\ We estimate that the total cost to the 
industry from these recurring expenses will total $270,000, on an 
annual basis (9 MFRs x $30,000).
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    \4\ $8,000 (for data center hosting for the physical server) + 
$12,000 (for system and database administrator support) + $10,000 
(for web/application developer support) = $30,000.
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    Changes to 49 CFR part 573 in 2013 required 27 manufacturers to 
update each recalled vehicle's repair status no less than every 7 days, 
for 15 years from the date the VIN is known to be included in the 
recall. This ongoing requirement to update the status of a VIN for 15 
years continues to add a recurring burden on top of the one-time burden 
to implement and operate these online search tools. We estimate that 8 
affected motorcycle manufacturers will make recalled VINs available for 
an average of 2 recalls each year and 19 affected passenger-vehicle 
manufacturers will make recalled VINs available for an average of 8 
recalls each year. We believe it will take no more than 1 hour, and 
potentially much less with automated systems, to update the VIN status 
of vehicles that have been remedied under the manufacturer's remedy 
program. We estimate this will require 8,736 burden hours per year (1 
hour x 2 recalls x 52 weeks x 8 MFRs + 1 hour x 8 recalls x 52 weeks x 
19 MFRs) to support the requirement to update the recalls completion 
status of each VIN in a recall at least weekly for 15 years.
    As the number of Part 573 Recall Reports has increased in recent 
years, so has the number of quarterly reports that track the completion 
of safety recalls. Our previous estimate of 3,800 quarterly reports 
received annually is now revised upwards to 4,498 quarter reports 
received annually. We estimated it takes manufacturers 10 minutes to 
gather the pertinent information for each quarterly report, and 4 
additional hours annually for the 17 major passenger-vehicle 
manufacturers to electronically submit their reports. Alliance & Global 
commented that as a ``best fit'' of information collected from its 
member companies, its members spend 1 hour (instead of 10 minutes) 
gathering pertinent information for each quarterly report, and 10 hours 
annually (instead of 4 hours) in additional time related to submitting 
their reports.
    As NHTSA previously observed in revising its estimate--in light of 
comments from Nissan--the gathering of pertinent information is likely 
automated through electronic reporting. See 81 FR 70270 (October 11, 
2016) (adopting Nissan's estimate of 10 minutes). However, we now 
recognize that the degree of automation of these processes may vary 
across manufacturers. Accordingly, we adopt Alliance & Global's 
estimate of 1 hour.
    NHTSA's estimate of 4 additional related hours annually for the 17 
major passenger-vehicle manufacturers to electronically submit their 
reports was based on an estimate of time, in response to a comment from 
Nissan, to electronically submit reports each quarter (for up to 30 
recalls in each given quarter). See 81 FR 70270 (October 11, 2016). 
NHTSA recognizes that major passenger-vehicle manufacturers may have 
more than 30 recalls on which to report for a given quarter, and will 
also include an additional six (6) hours for the 17 major passenger-
vehicle manufacturers, for a total of ten (10) burden hours. We 
therefore now estimate that the quarterly reporting burden pursuant to 
Part 573 totals 4,668 hours [(4,498 quarterly reports x 1 hour/report) 
+ (17 MFRs x 10 additional hours for electronic submission)].
    We continue to estimate a small burden of 2 hours annually in order 
to set up a manufacturer's online recalls portal account with the 
pertinent contact information and maintaining/updating their account 
information as needed. We estimate this will require a total of 548 
hours annually (2 hours x 274 MFRs).
    We estimated that 20 percent of Part 573 reports will involve a 
change or addition regarding recall components, and that at one hour 
per amended report, this totals 193 burden hours per year. Alliance & 
Global implicitly commented on the 20 percent figure, assuming in its 
proposed burden estimate that all recalls involve a change or addition 
regarding recall components. However, not all recalls require such a 
change, and Alliance & Global do not offer an alternative figure and/or 
further explanation of their estimate. Accordingly, NHTSA will retain 
the 20-percent figure in its estimate. Alliance & Global did, however, 
comment that this task generally takes its members at least two (2) 
hours per recall, and ``more in complex matters,'' and NHTSA 
acknowledges that its previous estimate could have been low--
particularly in the case of larger recalls involving a diverse group of 
vehicle years, makes, and models. NHTSA is adding another hour to this 
burden estimate for the 17 major passenger-vehicle manufacturers, 
recognizing that many recalls are conducted by smaller manufacturers 
but, at the same time, the burden may be more than 2 hours for complex 
recalls that Alliance & Global members may more often face. NHTSA now 
estimates the burden associated with a change or addition regarding 
recall components at 253 burden hours per year (299 recalls for 17 
major passenger-vehicle manufacturers x .20 = 60 recalls; 60 x 2 = 120 
hours) + (664 recalls for all other manufacturers x .20 = 133 recalls x 
1 = 133).
    As to the requirement that manufacturers notify NHTSA in the

[[Page 60793]]

event of a bankruptcy, we expect this notification to take an estimated 
2 hours to draft and submit to NHTSA. We continue to estimate that only 
10 manufacturers might submit such a notice to NHTSA each year, so we 
calculate the total burden at 20 hours (10 MFRs x 2 hours).
    We estimated that it takes manufacturers an average of 8 hours to 
draft their notification letters, submit them to NHTSA for review, and 
then finalize them for mailing to their affected owners and purchasers. 
Alliance & Global commented that it believed its members generally 
require 11 hours on average for these tasks. NHTSA does acknowledge its 
estimate may be low for major passenger-vehicle manufacturers, of which 
much of Alliance & Global are comprised. Accordingly, we estimate that 
the 49 CFR part 577 requirements result in 8,601 burden hours annually 
(8 hours per recall x 664 recalls per year) + (11 hours per recall x 
299).
    The burden estimate associated with the regulation that requires 
interim owner notifications within 60 days of filing a Part 573 Safety 
Recall Report must be revised upward. We previously calculated that 
about 10 percent of past recalls require an interim notification 
mailing, but recent trends show that 12 percent of recalls require an 
interim owner notification mailing. We continue to estimate the 
preparation of an interim notification can take up to 10 hours. We 
therefore estimate that 1160 burden hours are associated with the 60-
day interim notification requirement (963 recalls x .12 = 116 recalls; 
116 recalls times 10 hours per recall = 1160 hours).
    As for costs associated with notifying owners and purchasers of 
recalls, we continue to estimate a cost of $1.50 per first class mail 
notification, on average. This cost estimate includes the costs of 
printing, mailing, as well as the costs vehicle manufacturers may pay 
to third-party vendors to acquire the names and addresses of the 
current registered owners from state and territory departments of motor 
vehicles. In reviewing recent recall figures, we determined that an 
estimated 75.8 million letters are mailed yearly totaling $113,700,000 
($1.50 per letter x 75,800,000 letters). The requirement in 49 CFR part 
577 for a manufacturer to notify their affected customers within 60 
days would add an additional $13,644,000 (75,800,000 letters x .12 
requiring interim owner notifications = 9,096,000 letters; 9,096,000 x 
$1.50 = $13,644,000). In total, we estimate that the current 49 CFR 
part 577 requirements cost manufacturers a total of $127,614,000 
annually ($113,700,000 for owner notification letters + $13,644,000 for 
interim notification letters + $270,000 for VIN Look-up Tool operation 
= $127,614,000).
    NHTSA further has authority to require that, in an enforcement 
action, vehicle manufacturers conduct supplemental recall 
communications, potentially utilizing non-traditional means (e.g., text 
messaging, social media). This is currently occurring in the Takata 
recalls, which involve 19 vehicle manufacturers and approximately 46 
million defective inflators currently under recall in approximately 34 
million vehicles that need to be recalled as quickly as possible, given 
that thirteen people in the United States have lost their lives to a 
rupturing Takata inflator and more than two hundred people have 
reported associated injuries, many of which were disfiguring or life-
threatening. The scope of the Takata recalls is unprecedented in the 
agency's history. Therefore, the below analysis only takes into account 
the expected paperwork burden of this collection over the next three 
years, without making any assumptions about the likelihood of another 
large-scale recall that leads to similar types of supplementary 
notices. However, the agency believes the lessons learned from the 
Takata recall will provide a useful guidepost in structuring any 
similar future action.
    To address the scope and complexity of the Takata recalls, NHTSA 
issued a Coordinated Remedy Order, as amended on December 9, 2016 (the 
``ACRO''), which requires affected vehicle manufacturers to conduct 
supplemental owner notification efforts in coordination with NHTSA and 
the Independent Monitor of Takata. On December 23, 2016, the Monitor, 
in consultation with NHTSA, issued Coordinated Communications 
Recommendations for vehicle owner outreach (``CCRs''), which includes a 
recommendation that vehicle manufacturers provide at least one form of 
consumer outreach per month for vehicles in a launched recall campaign 
(i.e., a recall where parts are available) until the vehicle is 
remedied (unless otherwise accounted for as scrapped, stolen, exported, 
or otherwise unreachable under certain procedures in the ACRO). See 
CCRs ] 1(b); ACRO ]] 45-46. The Monitor also recommended that 
manufacturers utilize at least three non-traditional means of 
communication (postcards; email; telephone calls; text message; social 
media) as part of their overall outreach strategy. See CCRs ] 1(a). If 
a vehicle manufacturer does not wish to follow the Monitor's 
recommendations, the ACRO permits the manufacturer to propose an 
alternative communication strategy to NHTSA and the Monitor.
    Alliance & Global commented that supplemental recall communications 
are not mandatory. NHTSA acknowledges this is generally the rule 
(although the agency may require a manufacturer to provide additional 
notifications if it determines the initial notification did not result 
in an adequate number of remedied vehicles or equipment, see 49 U.S.C. 
30119(e), 49 CFR 577.10), and appreciates manufacturers' efforts in 
furtherance of the shared goal of remedying as many vehicles affected 
by the Takata recalls as possible. Alliance & Global also cited to a 
Notice of Proposed Rulemaking regarding additional owner notifications, 
and drew a parallel between potential burdens associated with that 
rulemaking and this information collection. NHTSA appreciates the 
parallel, but emphasizes that the ACRO and CCRs prescribe distinct 
requirements pursuant to NHTSA's enforcement authority, and that 
neither those documents nor this notice involve a rulemaking.
    Alliance & Global also commented that ``NHTSA did not identify all 
of the Takata ACRO and related tasks that are subject to PRA 
approval,'' and that the burden estimates should be revised 
accordingly. Alliance & Global thereafter listed additional ``tasks'' 
under the ACRO, with associated burdens for which they believe NHTSA 
must account here.\5\
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    \5\ Alliance & Global, while identifying requirements, do not 
offer an estimate of the associated burdens--observing they ``are 
striving to collect aggregated data to permit an informed estimate 
of the time and cost of these tasks, and intends to provide 
supplemental comments to aid the agency's evaluation of these 
burdens.''
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    NHTSA recognizes the ACRO sets forth various requirements in 
addition to the consumer outreach described above, but believes the 
investigatory exception to the PRA, which specifically exempts 
collections of information ``during the conduct of an administrative 
action, investigation, or audit involving an agency against specific 
individuals or entities,'' applies to such requirements. 5 CFR 
1320.3(c), 1320.4(a)(2); 44 U.S.C. 3501 et seq. Accordingly, NHTSA's 
responses to comments and burden estimates here are with respect only 
to the monthly outreach requirements outlined above.
    The Monitor's recommendations for outreach were adopted in 
significant part because research supports that frequent notifications 
using non-traditional means results in improved remedy completion. The 
agency cited

[[Page 60794]]

several sources in its 60-day notice \6\ with which Alliance & Global 
took issue, stating that ``NHTSA did not explain how supplemental 
communications contemplated by the ACRO and the CCR are `necessary for 
the proper performance of the functions of the agency, including 
whether the information will have practical utility' '' as required by 
OMB regulations. In relevant part, Alliance & Global's basis for this 
assertion appears to be that NHTSA did not specifically prove that a 
monthly cadence of outreach was more effective than other outreach 
frequencies because NHTSA only cited to general research regarding 
outreach frequency in support of this proposition. NHTSA recognizes 
that these sources did not specifically conclude that monthly 
notifications (instead of, e.g., weekly, bi-weekly, bi-monthly, etc.) 
are always the most effective. But the sources to which NHTSA cites all 
tend toward advocating greater notification frequency--not less--and 
Alliance & Global do not point to any sources of their own that stand 
specifically for the contrary. The very nature of the Takata recalls--
unprecedented and, as Alliance & Global recognize, ``extraordinary''--
means that no research will be perfectly on-point, and that in addition 
to relying on lessons learned as the recall campaigns continue, it is 
prudent to rely on other sources of probative information, including 
information from relatively analogous settings such as advertising, 
where the purpose is to locate specific consumers and effectively 
communicate a specific message to those consumers. The underlying 
principle, of frequent outreach via multiple communications methods, is 
supported by the available information, including a recently released 
report from the U.S. Government Accountability Office,\7\ as well as a 
report from Independent Monitor specific to the very recalls at issue 
here.\8\
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    \6\ See 82 FR 45941; GM Safety Recalls: Innovations in Customer 
Outreach (NHTSA Retooling Recalls Workshop, April 28, 2015); Auto 
Alliance & NADA Survey Key Findings (November 2015); GM letter to 
NHTSA in comment to NPRM, Docket No. NHTSA-2016-0001 (March 23, 
2016); Susanne Schmidt & Martin Eisend, Advertising Repetition: A 
Meta-Analysis on Effective Frequency in Advertising, 44 J. 
Advertising 415, 425 (2015); Blair Entenmann, Marketing Help!, The 
Principles of Targeted Direct Mail Advertising (2007); Chuck 
Flantroy, Direct Mail Works: The Power of Frequency, Kessler 
Creative (August 31, 2016).
    \7\ See U.S. Government Accountability Office, Auto Recalls: 
NHTSA Should Take Steps to Further Improve the Usability of Its 
website (GAO-18-127) (Dec. 4, 2017), at 10-11, 13-15 (indicating 
articulated safety risk is the most influential factor in owners' 
decision to obtain repair, and that owners have additional 
preference for receiving recall notification by electronic means).
    \8\ See The Independent Monitor of Takata and Coordinated Remedy 
Program, The State of the Takata Airbag Recalls (Nov. 15, 2017), 
Section VIII.A, available at https://www.nhtsa.gov/sites/nhtsa.dot.gov/files/documents/the_state_of_the_takata_airbag_recalls-report_of_the_independent_monitor_112217_v3_tag.pdf. (``[T]he Monitor's research to date indicates 
that communications regarding the recalls should be frequent and 
clearly written with a call to action. . . . [and] shows that in 
cases of highly dangerous recalls, affected vehicle owners want to 
be notified with urgent, disruptive messages, repeated with great 
frequency in order to better ensure they become aware of the issue 
and understand its gravity.'').
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    In a similar vein, the agency is also aware of generalized concerns 
about ``notification fatigue,'' and invited comment on this phenomenon, 
including the optimal frequency, content, mode, and method of recall/
defects notifications from manufacturers to consumers. The agency 
previously stated its interest in any research or data on consumer 
``fatigue'' that relates to a recall with potential consequences of 
death or severe injury, as in the case of the Takata recalls. Alliance 
& Global did not provide any information on this issue. Instead, 
Alliance & Global noted that they are unaware of data-based research 
that supports the notion that outreach pursuant to the ACRO actually 
results in improved remedy completion. Setting aside findings of the 
Independent Monitor that indicate otherwise, see n.8, this also 
implicitly recognizes the central issue: The Takata recalls are 
unprecedented, and that while it may be ``that no one knows `the 
optimal frequency, content, mode and method' of communicating with 
consumers about recalls, including whether `more' is always `better,' 
'' the studies NHTSA cites indicate that more is in fact better. 
Alliance & Global have cited no studies of their own to the contrary.
    In any event, NHTSA appreciates Alliance & Global's comments as 
part of the ongoing dialogue to better understand the relationship 
between recall notification and recall completion. NHTSA has met, and 
continues to meet, with numerous manufacturers to discuss this very 
issue, including at regularly scheduled meetings for the vehicle 
manufacturers affected by the Takata air bag inflator recalls. As 
Alliance & Global acknowledge, affected vehicle manufacturers have been 
working with the Independent Monitor to improve outreach results in the 
Takata recalls, which should result in further understanding of the 
issue. NHTSA will continue to monitor the development of knowledge in 
this area, and looks forward to future collaboration with 
manufacturers.
    The volume of outreach required by the ACRO and the CCRs (and the 
costs associated with that outreach) is a function of the number of 
unrepaired vehicles that are in a launched campaign and are not 
otherwise accounted for as scrapped, stolen, exported, or otherwise 
unreachable. The schedule in Paragraph 35 of the ACRO delineates the 
expected remedy completion rate, by quarter, of vehicles in a launched 
remedy campaign.
    NHTSA estimated a yearly average of 19 vehicle manufacturers 
issuing monthly supplemental communications over the next three years 
pursuant to the ACRO and the CCRs. Manufacturers may satisfy the CCRs 
through third-party vendors (which many manufacturers are already 
utilizing), in-house strategies, or some combination thereof. NHTSA 
estimated the cost for supplemental communications at $0.44 per VIN per 
month.
    Utilizing these variables, we estimated an initial annualized cost 
contemplated by the ACRO and CCRs over the next three years of 
$43,557,722 per year, and discounted this annualized cost by the cost 
of outreach efforts settling defendants in the Southern District of 
Florida multi-district litigation (Toyota, Subaru, Nissan, BMW, Mazda, 
and Honda) are required to conduct pursuant to their respective 
settlements--which amounted to a discount of $15,721,393. See generally 
In re: Takata Airbag Products Liab. Litig., 14-cv-24009, MDL No. 2599 
(S.D. Fla.). Those outreach programs are to utilize non-traditional 
methods of outreach, including telephone, email, social media, and text 
messaging, and NHTSA anticipated they will produce outreach that would 
satisfy the minimum requirements of the CCRs. In total, therefore, we 
estimated the annualized burden at $27,836,329. NHTSA also estimated it 
would take manufacturers 2 hours each month to draft or customize 
supplemental recall communications utilizing non-traditional means, 
submit them to NHTSA for review, and finalize them to send to affected 
owners and purchasers.
    Alliance & Global commented that, even assuming a cost of $0.44/
VIN, monthly outreach costs would actually total $108 million per year 
based on the number of unremedied vehicles stated in the Independent 
Monitor's report, The State of Takata Airbag Recalls (November 15, 
2017). NHTSA notes, however, that such an estimate assumes that none of 
those vehicles would actually be repaired (and therefore not subject to 
outreach requirements) at any

[[Page 60795]]

point during a given year--a factor that NHTSA's methodology did take 
into account, with reference to the schedule set forth in Paragraph 35 
of the ACRO.
    Alliance & Global also commented that the cost burden of this 
outreach ``is far more than $0.44/VIN on average and requires more than 
2 hours per month to prepare and administer.'' Alliance & Global, 
however, provide an unclear picture of alternative estimates, offering 
only ``initial average estimates'' of $2 to $5/VIN, and then observing 
that other initiatives ``can further increase costs as high as 
approximately $30 to more than $100/VIN.'' Indeed, at this time 
Alliance & Global can only provide what it refers to be a low-end 
estimate of a burden close to $40 million/month for its members 
affected by the Takata recalls, ``expect[ing] to refine [their] 
estimates in supplemental comments.'' And Alliance & Global offered no 
alternative estimate to the NHTSA's estimated burden of 2 hours per 
month to prepare and administer non-traditional outreach.
    Alliance & Global appear to admit that their cost estimates are at 
most preliminary, and therefore it is difficult for NHTSA to 
significantly revise its cost estimate based on these comments. 
However, NHTSA appreciates Alliance & Global's input, which provides 
useful insight into the cost of these outreach programs--about which to 
this point NHTSA has had relatively little information. NHTSA further 
recognizes per-VIN outreach costs can vary significantly depending on 
the vehicles and owners involved, as well as the particular strategies 
manufacturers have selected to engage in consumer outreach for 
different recalls at different levels of maturity. Accordingly, NHTSA 
accepts Alliance & Global's assertion that, on average, a per-VIN-per-
month outreach estimate of $0.44 is low, and will revise its estimate 
to $2/VIN per month. NHTSA will retain its estimated burden of 2 hours 
per month to prepare and administer non-traditional outreach. NHTSA 
looks forward to additional insights it may gain from supplemental 
information Alliance & Global may submit.
    Alliance & Global also commented that discounting the annualized 
outreach costs by costs of anticipated outreach pursuant to MDL 
settlements was not ``an appropriate baseline for this cost analysis.'' 
Alliance & Global stated the outreach efforts the settling 
manufacturers were conducting pursuant to the ACRO and CCRs facilitated 
their MDL settlements, and that the ACRO and CCRs predated the MDL 
settlements. Alliance & Global also posited that it is ``premature'' to 
assume outreach efforts under the ACRO and CCRs will satisfy the MDL 
settlement obligations. Assuming, for the sake of argument, that the 
ACRO and CCRs ``facilitated'' the MDL settlements, it is of no 
consequence; going forward, those settling vehicle manufacturers must 
comply with the terms of their respective settlements, which include 
provisions for enhanced outreach efforts. While NHTSA acknowledges the 
exact nature of this outreach is presently unclear, at this juncture 
NHTSA anticipates it is more likely than not that the outreach efforts 
conducted under the settlements would satisfy the minimum requirements 
of the ACRO and CCRs. Alliance & Global have provided no indication 
otherwise.
    Accordingly, NHTSA estimates the terms of the ACRO and the CCRs, 
assuming remedy-completion rates consistent with those set forth in the 
former, contemplate an initial annualized cost of $197,989,647 per year 
for the next three years (2018-2020), with an annualized discount of 
$71,460,877 to account for outreach conducted pursuant to the MDL 
settlements described above, for a net annualized cost of $126,528,770. 
NHTSA estimates that manufacturers will take an average of 2 hours each 
month drafting or customizing supplemental recall communications 
utilizing non-traditional means, submitting them to NHTSA for review, 
and finalizing them to send to affected owners and purchasers. NHTSA 
therefore estimates that 456 burden hours annually are associated with 
issuing these supplemental recall communications (12 months x 2 hours 
per month x 19 manufacturers = 456 hours).
    Because of the forgoing burden estimates, we are revising the 
burden estimate associated with this collection. The 49 CFR part 573 
and 49 CFR part 577 requirements found in today's notice will require 
63,606 hours each year. Additionally, manufacturers impacted by 49 CFR 
part 573 and 49 CFR part 577 requirements will incur a recurring annual 
cost estimated at $127,614,000 total. The burden estimate in this 
collection contemplated for conducting supplemental recall 
communications under the ACRO to achieve completion of the Takata 
recalls is 456 hours each year. Additionally, the ACRO contemplates 
impacted vehicle manufacturers incurring an annual cost estimated at 
$126,528,770. Therefore, in total, we estimate the burden associated 
with this collection to be 64,062 hours each year, with a recurring 
annual cost estimated at $254,142,770.
    Estimated Number of Respondents--NHTSA estimates that there will be 
approximately 274 manufacturers per year filing defect or noncompliance 
reports and completing the other information collection 
responsibilities associated with those filings. NHTSA estimates there 
will be an average of 19 manufacturers each year conducting 
supplemental nontraditional monthly outreach pursuant to administrative 
order in an enforcement action associated with the Takata recall.

Jeffrey Giuseppe,
Associate Administrator for Enforcement.
[FR Doc. 2017-27635 Filed 12-21-17; 8:45 am]
 BILLING CODE 4910-59-P