[Federal Register Volume 60, Number 117 (Monday, June 19, 1995)]
[Proposed Rules]
[Pages 31936-31939]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-14904]
=======================================================================
-----------------------------------------------------------------------
[[Page 31937]]
DEPARTMENT OF TRANSPORTATION
National Highway Traffic Safety Administration
49 CFR Part 531
[Docket No. 95-45; Notice 1]
Passenger Automobile Average Fuel Economy Standards; Proposed
Decision To Grant Exemption
AGENCY: National Highway Traffic Safety Administration (NHTSA), DOT.
ACTION: Proposed decision.
-----------------------------------------------------------------------
SUMMARY: This proposed decision responds to a petition filed by MedNet
Incorporated requesting that it be exempted from the generally
applicable average fuel economy standard of 27.5 miles per gallon (mpg)
for model years 1996 through 1998, and that lower alternative standards
be established. In this document, NHTSA proposes that the requested
exemption be granted and that an alternative standard of 17.0 mpg be
established for MY 1996, MY 1997, and MY 1998, for MedNet.
DATES: Comments on this proposed decision must be received on or before
August 3, 1995.
ADDRESSES: Comments on this proposal must refer to the docket number
and notice number in the heading of this notice and be submitted,
preferably in ten copies, to: Docket Section, Room 5109, National
Highway Traffic Safety Administration, 400 Seventh Street, S.W.,
Washington, DC 20590. Docket hours are 9:30 a.m. to 4 p.m., Monday
through Friday.
FOR FURTHER INFORMATION CONTACT: Ms. Henrietta Spinner, Office of
Market Incentives, NHTSA, 400 Seventh Street, SW, Washington, DC 20590.
Ms. Spinner's telephone number is: (202) 366-4802.
SUPPLEMENTARY INFORMATION:
Statutory Background
Pursuant to 49 U.S.C. section 32902(d), NHTSA may exempt a low
volume manufacturer of passenger automobiles from the generally
applicable average fuel economy standards if NHTSA concludes that those
standards are more stringent than the maximum feasible average fuel
economy for that manufacturer and if NHTSA establishes an alternative
standard for that manufacturer at its maximum feasible level. Under the
statute, a low volume manufacturer is one that manufactured (worldwide)
fewer than 10,000 passenger automobiles in the second model year before
the model year for which the exemption is sought (the affected model
year) and that will manufacture fewer than 10,000 passenger automobiles
in the affected model year. In determining the maximum feasible average
fuel economy, the agency is required under 49 U.S.C. 32902(f) to
consider:
(1) Technological feasibility
(2) Economic practicability
(3) The effect of other Federal motor vehicle standards on fuel
economy, and
(4) The need of the Nation to conserve energy.
The statute at 49 U.S.C. 32902(d)(2) permits NHTSA to establish
alternative average fuel economy standards applicable to exempted low
volume manufacturers in one of three ways: (1) a separate standard for
each exempted manufacturer; (2) a separate average fuel economy
standard applicable to each class of exempted automobiles (classes
would be based on design, size, price, or other factors); or (3) a
single standard for all exempted manufacturers.
Background Information on MedNet
MedNet Incorporated (MedNet) is a small company that will produce
the Dutcher Paratransit Vehicle (PTV). Dutcher Motors, Inc. (Dutcher),
the previous manufacturer of these vehicles, was chartered in 1984 to
manufacture a limited quantity of special purpose vehicles--Dutcher
PTV. Since its establishment, Dutcher produced only two vehicles.
MedNet recently acquired Dutcher's assets. Dutcher's willingness to
sell to MedNet was based on its own inability to produce the Dutcher
PTV vehicles. MedNet now intends to produce the Dutcher PTV. The
Dutcher PTV is a large passenger car intended to be used in providing
transportation for mobility-impaired individuals. MedNet intends to
begin production of the Dutcher PTV in the summer of 1995 and
anticipates manufacturing 100, 250, and 500 vehicles, respectively for
MYs 1996, 1997, and 1998.
MedNet's Petition
On June 27, 1994, MedNet petitioned NHTSA for exemption from CAFE
standards for model years (MYs) 1996, 1997, and 1998. MedNet's petition
was filed less than 24 months prior to the beginning of model year 1996
as required by 49 CFR Part 525.6. The petition can be accepted late if
``good cause for late submission is shown'' as stated in 49 CFR 525.6.
The reason for MedNet's late submission for MY 1996 is its recent
acquisition of Dutcher Motors, Inc. (Dutcher) assets. Dutcher's
willingness to sell to MedNet was based on its own inability to produce
the Dutcher PTV vehicles. Thereafter, MedNet relocated Dutcher's
equipment and parts from San Marcos, California to Battle Creek,
Michigan. Because of new ownership and lack of knowledge of the
required procedures of 49 CFR 525, MedNet believed that it was exempted
from the standards based on Dutcher's prior exemption (56 FR 37478).
Dutcher has filed several petitions requesting exemptions from the
generally applicable CAFE standards for MYs 1986-1988 and MYs 1992-
1995. Dutcher's most recent petition was submitted on December 5, 1990,
requesting alternative standards for MYs 1992-1995. The agency granted
the petition and established an alternate standard of 17.0 miles per
gallon (mpg) for MYs 1992-1995.
Under the circumstances outlined above, NHTSA determines good cause
is shown by MedNet for the submission of its untimely petition.
Classification of Dutcher PTV as a Passenger Automobile
Due to differences in the definitions used by this agency under the
Cost Savings Act for CAFE purposes and the Environmental Protection
Agency under the Clean Air Act for emissions control purposes, the
Dutcher PTV is classified differently by these two agencies. The
Environmental Protection Agency (EPA) classified the predecessor to the
Dutcher PTV, the Transitaxi, as a ``light duty truck'' for emissions
compliance due to that model's derivation from existing truck
components. (40 CFR 86.02-2). However, NHTSA concluded that the
Transitaxi was a ``passenger automobile'' for fuel economy purposes.
Both the Transitaxi and the Dutcher PTV are passenger automobiles under
the definition in 49 CFR 523.4 since each transports not more than 10
individuals and does not meet any configurational or usage criteria for
light trucks given in 49 CFR 523.5. MedNet plans to produce the Dutcher
PTV without substantial change from the design used by Dutcher for the
Transitaxi. NHTSA therefore concludes that the Dutcher PTV to be
produced in MY's 1996-1998 is a ``passenger automobile'' for fuel
economy purposes.
Methodology Used To Project Maximum Feasible Average Fuel Economy Level
for MedNet
Baseline Fuel Economy
To project the level of fuel economy which could be achieved by
MedNet in MYs 1996-1998, the agency considered whether there were
technical or other improvements that would be feasible for these
vehicles, and whether or not the company currently plans to incorporate
such improvements in the vehicles. The [[Page 31938]] agency reviewed
the technological feasibility of any changes and their economic
practicability.
NHTSA interprets ``technological feasibility'' as meaning that
technology which would be available to MedNet for use on its MY 1996
through 1998 automobiles, and which would improve the fuel economy of
those automobiles. The areas examined for technologically feasible
improvements were weight reduction, aerodynamic improvements, engine
improvements, drive line improvements, and reduced rolling resistance.
The agency interprets ``economic practicability'' as meaning the
financial capability of the manufacturer to improve its average fuel
economy by incorporating technologically feasible changes to its MYs
1996 through 1998 automobiles. In assuming that capability, the agency
has always considered market demand as an implicit part of the concept
of economic practicability.
In accordance with the concerns of economic practicability, NHTSA
has considered only those improvements which would be compatible with
the basic design concepts of MedNet automobiles. Since NHTSA assumes
that MedNet will continue to sell vehicles exclusively designed to be
used for transporting the wheelchair bound or other mobility-impaired
individuals, design changes that would impair the ability of the
vehicle to perform this function were not considered. Such changes to
the basic design would be economically impracticable since they might
well significantly reduce the demand for these automobiles, thereby
reducing sales and causing significant economic injury to the low
volume manufacturer.
Technology for Fuel Economy Improvement
Due to MedNet's limited financial resources, small engineering
staff, very low production volume, and assemblage of stock components,
few opportunities for technological improvement for fuel economy exist.
MedNet uses General Motors 3.8 liter electronically fuel injected V-6
engines and four speed automatic transmissions for its MYs 1996-1998
prototypes. Therefore, MedNet depends entirely on the supplier of the
engine and drivetrain for technological improvements in fuel efficiency
of the engine and drivetrain.
MedNet uses a four-speed automatic transmission with lockup torque
converter clutch, one of the more efficient transmission designs. The
constant velocity universal joints are a low friction design.
MedNet incorporates in its Dutcher PTV flush windows and door
handles, a bottom cover, and a smooth front cowl, all of which reduce
drag on the vehicle. MedNet's low dynamometer horsepower setting for
certification testing, as shown in the table below, when compared to
other small passenger vans and wagons, illustrates that the Dutcher PTV
uses good aerodynamic design equivalent to current industry standards.
Dynamometer Setting Comparison
------------------------------------------------------------------------
Actual
Model dynamometer
horsepower
------------------------------------------------------------------------
Dutcher PTV............................................. 12.5
Ford Aerostar*.......................................... 11.2
GM Astro*............................................... 17.9
Toyota Previa*.......................................... 14.0
Chrysler Caravan/Voyager*............................... 11.8
Mercury Villager*....................................... 10.1
Chevrolet Caprice Wagon................................. 8.5
------------------------------------------------------------------------
*These vehicles are classified by EPA as light trucks.
To achieve maximum weight reduction, the body is made primarily of
fiberglass.
MedNet's only significant opportunity for improvement will be the
result of any improvements which GM decides for its own purposes to
make in the engine and drivetrain it will supply for MedNet. MedNet's
role will be limited to attempting to modify the drivetrain to meet
emissions requirements.
Model Mix
Since only one vehicle model will be built for MY's 1996-1998, the
MedNet corporate average fuel economy is based on the fuel economy of
that one model, the Dutcher PTV, and cannot be averaged in with the
fuel economy of any other models.
The Effect of Other Vehicle Standards
The new more stringent California emission standards enacted in MY
1995 and the similarly stringent Federal Clean Air Act Amendments will
apply in MY 1996. MedNet may achieve lower fuel economy due to
compliance with these standards. In addition, a portion of its limited
engineering resources will have to be expended to comply with these
more stringent emissions standards including, but not limited to,
evaporative emission standards.
Federal safety standards also have an adverse effect on fuel
economy of Dutcher PTV vehicles. These standards include 49 CFR Part
581 Energy absorbing bumpers, Standard No. 214 Side impact protection,
and Standard No. 208, Occupant crash protection. These standards tend
to reduce achievable CAFE levels, since they result in increased
vehicle weight. As previously noted, MedNet is a small company, and
engineering resources are limited. Priority must be given to meeting
mandatory standards to remain in the marketplace.
The Need of the Nation to Conserve Energy
The agency recognizes there is a need to conserve energy, to
promote energy security, and to improve balance of payments. However,
as stated above, NHTSA has tentatively determined that it is not
technologically feasible or economically practicable for MedNet to
achieve an average fuel economy in MYs 1996 through 1998 above the
levels set forth in this proposed decision. Granting an exemption to
MedNet and setting an alternative standard at that level would result
in only a negligible increase in fuel consumption and would not affect
the need of the Nation to conserve energy.
Maximum Feasible Average Fuel Economy for MedNet
The agency has tentatively concluded that it would not be
technologically feasible and economically practicable for MedNet to
improve the fuel economy of its MY 1996 through 1998 above an average
of 17.0 mpg for MY 1996, 17.0 mpg for MY 1997, and 17.0 mpg for MY
1998. Federal automobile standards would not adversely affect
achievable fuel economy beyond the amount already factored into
MedNet's projections, and the national effort to conserve energy would
not be affected by granting the requested exemption and establishing an
alternative standard.
Consequently, the agency tentatively concludes that the maximum
feasible average fuel economy for MedNet is 17.0 mpg in MY 1996, 17.0
mpg in MY 1997, and 17.0 mpg in MY 1998.
NHTSA tentatively concludes that it would be appropriate to
establish a separate standard for MedNet for the following reasons. For
MY 1996, the agency has already granted petitions for an alternative
standard of 14.6 mpg for Rolls-Royce. The agency has also received a
petition from Rolls-Royce for an alternative standard for MY 1997.
Therefore, the agency cannot use the second (class standards) or third
(single standard for all exempted manufacturers) approaches for MYs
1996 and 1997. In order to avoid undue hardship to MedNet, given its
limited ability to improve the fuel economy of its vehicles, the use of
a single standard will be allowed by MY 1998 as well. [[Page 31939]]
Regulatory Impact Analyses
NHTSA has analyzed this proposal and determined that neither
Executive Order 12866 nor the Department of Transportation's regulatory
policies and procedures apply. Under Executive Order 12866, the
proposal would not establish a ``rule,'' which is defined in the
Executive Order as ``an agency statement of general applicability and
future effect.'' The proposed exemption is not generally applicable,
since it would apply only to MedNet, Inc., as discussed in this notice.
Under DOT regulatory policies and procedures, the proposed exemption
would not be a ``significant regulation.'' If the Executive Order and
the Departmental policies and procedures were applicable, the agency
would have determined that this proposed action is neither major nor
significant. The principal impact of this proposal is that the exempted
company would not be required to pay civil penalties if its maximum
feasible average fuel economy were achieved, and purchasers of those
vehicles would not have to bear the burden of those civil penalties in
the form of higher prices. Since this proposal sets an alternative
standard at the level determined to be MedNet's maximum feasible level
for MYs 1996 through 1998, no fuel would be saved by establishing a
higher alternative standard. NHTSA finds that because of the minuscule
size of the MedNet fleet, that incremental usage of gasoline by MedNet
customers would not affect the nation's need to conserve gasoline.
There would not be any impacts for the public at large.
The agency has also considered the environmental implications of
this proposed exemption in accordance with the National Environmental
Policy Act and determined that this proposed exemption if adopted,
would not significantly affect the human environment. Regardless of the
fuel economy of the exempted vehicles, they must pass the emissions
standards which measure the amount of emissions per mile traveled.
Thus, the quality of the air is not affected by the proposed exemptions
and alternative standards. Further, since the exempted passenger
automobiles cannot achieve better fuel economy than is proposed herein,
granting these proposed exemptions would not affect the amount of fuel
used.
Interested persons are invited to submit comments on the proposed
decision. It is requested but not required that 10 copies be submitted.
All comments must not exceed 15 pages in length (49 CFR 553.21).
Necessary attachments may be appended to these submissions without
regard to the 15 page limit. This limitation is intended to encourage
commenters to detail their primary arguments in a concise fashion.
If a commenter wishes to submit certain information under a claim
of confidentiality, three copies of the complete submission, including
purportedly confidential business information, should be submitted to
the Chief Counsel, NHTSA, at the street address given above, and seven
copies from which the purportedly confidential business information has
been deleted, should be submitted to the Docket Section. A request for
confidentiality should be accompanied by a cover letter setting forth
the information specified in the agency's confidential business
information regulation. 49 CFR part 512.
All comments received before the close of business on the comment
closing indicated above for the proposal will be considered, and will
be available for examination in the docket at the above address both
before and after that date. To the extent possible, comments filed
under the closing date will also be considered. Comments received too
late for consideration in regard to the final rule will be considered
as suggestions for further rulemaking action. Comments on the proposal
will be available for inspection in the docket. NHTSA will continue to
file relevant information as it becomes available in the docket after
the closing date, and it is recommended that interested persons
continue to examine the docket for new material.
Those persons desiring to be notified upon receipt of their
comments in the rules docket should enclose a self- addressed, stamped
postcard in the envelope with their comments. Upon receiving the
comments, the docket supervisor will return the postcard by mail.
List of Subjects in 49 CFR Part 531
Energy conservation, Gasoline, Imports, Motor vehicles.
In consideration of the foregoing, 49 CFR part 531 would be amended
to read as follows:
PART 531--[AMENDED]
1. The authority citation for part 531 would be revised to read as
follows:
Authority: 49 U.S.C. 32902, delegation of authority at 49 CFR
1.50.
2. In Sec. 531.5, the introductory text of paragraph (b) is
republished for the convenience of the reader and paragraph (b)(12)
would be added to read as follows:
Sec. 531.5 Fuel economy standards.
* * * * *
(b) The following manufacturers shall comply with the standards
indicated below for the specified model years:
* * * * *
(12) MedNet, Inc.
------------------------------------------------------------------------
Average fuel
economy
Model year standard
(miles per
gallon)
------------------------------------------------------------------------
1996.................................................... 17.0
1997.................................................... 17.0
1998.................................................... 17.0
------------------------------------------------------------------------
Issued on: June 14, 1995.
Barry Felrice,
Associate Administrator for Safety Performance Standards.
[FR Doc. 95-14904 Filed 6-16-95; 8:45 am]
BILLING CODE 4910-59-P
