02-1675. Light Truck Average Fuel Economy Standard, Model Year 2004

AGENCY:

National Highway Traffic Safety Administration (NHTSA), DOT.

ACTION:

Notice of proposed rulemaking.

SUMMARY:

This document proposes to establish the corporate average fuel economy standard for light trucks manufactured in model year (MY) 2004. The establishment of the standard is required by statute. The proposed standard is 20.7 mpg.

DATES:

Comments must be received on or before February 25, 2002. The comment period has been shortened due to a statutory deadline.

ADDRESSES:

You should mention the docket number of this document in your comments and submit your comments in writing to: Docket Management, Room PL-401, 400 Seventh Street, S.W., Washington, D.C., 20590. Comments may also be submitted to the docket electronically by logging onto the Dockets Management System website at http://dms.dot.gov. Click on “Help & Information” or “Help/Info” to obtain instructions for filing the document electronically. You may call Docket Management at 202-366-9324. You may visit the Docket from 10:00 a.m. to 5:00 p.m., Monday through Friday.

FOR FURTHER INFORMATION CONTACT:

For non-legal issues, call Ken Katz, Office of Planning and Consumer Programs, at [phone], facsimile [phone], electronic mail [e-mail]. For legal issues, call Otto Matheke, Office of the Chief Counsel, at 202-366-5263.

SUPPLEMENTARY INFORMATION:

I. Background

In December 1975, during the aftermath of the energy crisis created by the oil embargo of 1973-74, Congress enacted the Energy Policy and Conservation Act. The Act established an automotive fuel economy regulatory program by adding Title V, “Improving Automotive Efficiency,” to the Motor Vehicle Information and Cost Saving Act. Title V was amended from time to time, and was codified without substantive change as Chapter 329 of Title 49 of the United States Code. Chapter 329 provides for the issuance of average fuel economy standards for passenger automobiles and automobiles that are not passenger automobiles (light trucks).

Section 32902(a) of Chapter 329 states that the Secretary of Transportation shall, at least eighteen months prior to the beginning of each model year, prescribe by regulation corporate average fuel economy (CAFE) standards for light trucks for that model year. That section also states that “[e]ach standard shall be the maximum feasible average fuel economy level that the Secretary decides the manufacturers can achieve in that model year.” (The Secretary has delegated the authority to implement the automotive fuel economy program to the Administrator of NHTSA. 49 CFR 1.50(f).) Section 32902(f) provides that, in determining the maximum feasible average fuel economy level, we shall consider four criteria: technological feasibility, economic practicability, the effect of other motor vehicle standards of the Government on fuel economy, and the need of the United States to conserve energy. Using this authority, we have set light truck CAFE standards through MY 2003. See 49 CFR 533.5(a). The standard for MY 2003 is 20.7 miles per gallon (mpg)(66 FR 17513; April 12, 2001).

From 1995 through mid-December 2001, the standards-setting process for light truck CAFE standards was affected by restrictions imposed in the Department of Transportation's annual Appropriations Acts.

On November 15, 1995, the Department of Transportation and Related Agencies Appropriations Act for FY 1996 was enacted. Public Law 104-50. Section 330 of that Act provides:

None of the funds in this Act shall be available to prepare, propose, or promulgate any regulations . . . prescribing corporate average fuel economy standards for automobiles . . . in any model year that differs from standards promulgated for such automobiles prior to enactment of this section.

We then issued a notice of proposed rulemaking (NPRM), limited to MY 1998, that proposed to set the light truck CAFE standard for that year at 20.7 mpg, the same standard as had been set for MY 1997. 61 FR 145 (January 3, 1996). We adopted this 20.7 mpg-standard in a final rule issued on March 29, 1996. 61 FR 14680 (April 3, 1996).

On September 30, 1996, the Department of Transportation and Related Agencies Appropriations Act for FY 1997 was enacted. Pub. L. 104-205. Section 323 of that Act provides:

None of the funds in this Act shall be available to prepare, propose, or promulgate any regulations . . . prescribing corporate average fuel economy standards for automobiles . . . in any model year that differs from standards promulgated for such automobiles prior to enactment of this section.

On March 31, 1997, we issued a final rule (62 FR 15859) establishing light truck fuel economy standards for MY 1999. This final rule was not preceded by an NPRM. The agency concluded that the restriction contained in Section 323 of the FY 1997 Appropriations Act prevented us from issuing any standards at a level other than the standard set for MY 1998. Because we had no other course of action, we determined that issuing an NPRM was unnecessary and contrary to the public interest.

Because the same limitation on the setting for CAFE standards was included in the appropriations acts for FYs 1998-2001, we followed that same procedure during those fiscal years and did not issue any NPRMs in the series of rulemakings we conducted to establish the light truck fuel economy standards for MYs 2000-2003. The agency concluded in those rulemakings, as it had when setting the MY 1999 standard, that the restrictions contained in the appropriations acts prevented us from issuing any standards other than the standard set for the prior model year. We also determined that issuing an NPRM was unnecessary and contrary to the public interest because we had no other course of action.

The Department of Transportation and Related Agencies Appropriations Act for FY 2001 was enacted on October 23, 2000. Public Law 106-346. This law provided appropriations for the Department of Transportation for FY 2001, and is the law under which we issued the light truck CAFE standard for MY 2003. While Section 320 of that Act contains a restriction on CAFE rulemaking identical to that contained in prior appropriation acts, the Conference Committee Report for that Act directed the National Academy of Sciences (NAS) to conduct a study to evaluate the effectiveness and impacts of CAFE standards (H.R. Conf. Rep. No. 106-940, at 117-118).

The NAS submitted its report to the Department of Transportation on July 30, 2001. The report contains a number of key findings and recommendations. The Department of Transportation is in the process of evaluating and responding to the issues raised by the report. With regard to this proposal, however, it is important to note that the NAS also found that any policy change that is implemented in too short a period of time has the potential to adversely affect manufacturers, their suppliers, their employees, and consumers.

The series of restrictions on appropriations ended with the enactment of the Department of Transportation and Related Agencies Appropriations Act for FY 2002 on December 18, 2001. Public Law 107-87. The FY 2002 Appropriations Act, unlike the appropriations acts for fiscal years 1996-2001, does not prevent NHTSA from expending funds to prepare, propose or promulgate fuel economy standards. Accordingly, for the first time since 1995, NHTSA is authorized to expend funds to establish fuel economy standards for non-passenger automobiles at the maximum feasible average fuel economy level in accordance with section 32902(a) of Chapter 329.

The availability of these funds does not, as a practical matter, translate into an effective ability to conduct its customary level of analysis of potential MY 2004 light truck fuel economy standards. NHTSA cannot delay the beginning of rulemaking to establish the MY 2004 standard to provide time for that analysis. As noted above, NHTSA must establish the fuel economy standard for a given model year at least 18 months before that model year begins. In the case of MY 2004, this statutory deadline requires NHTSA to issue a fuel economy standard on or before April 1, 2002. As the agency was unable, from 1995 until mid-December 2001, to spend any funds for the collection and analysis of data relating to CAFE levels, it has not been able to lay the factual or analytical foundation necessary to develop a proposed standard other than one at 20.7 mpg, the level of the MY 1996-2003 standards.

II. Agency Proposal

The agency is proposing to establish the MY 2004 fuel economy standard for all light trucks manufactured by a manufacturer at 20.7 mpg, the same level previously adopted for MY 2003. The agency's proposal reflects the absence of any current information or analysis regarding the impact of any change in CAFE standards and the capabilities of manufacturers.

The agency is inviting comments, however, on the maximum feasible level of average fuel economy, including comments as to whether motor vehicle manufacturers can, with the limited leadtime available and product plans essentially established, achieve a level higher than 20.7 mpg in MY 2004. In establishing CAFE standards, NHTSA is commanded by section 32902(f) to determine the maximum feasible average fuel economy after considering technological feasibility, economic practicability, the effect of other Government motor vehicle standards on fuel economy, and the need of the United States to conserve energy. NHTSA has traditionally performed the analysis required by section 32902(f) through the publication of requests for information (similar to the one published concurrently with this notice) seeking data from manufacturers and other interested parties regarding technical capabilities, future product plans, anticipated model mix, impact of safety and emissions regulations, the economic impacts of changes in fuel economy standard, the need of the nation to conserve energy and other factors. Once these data are obtained, the agency traditionally assesses the accuracy of manufacturer projections, the likelihood that certain technical innovations may increase fuel efficiency, the potential impact of consumer demand on the composition of manufacturer fleets, the capability of different manufacturers to attain a minimum levels of fuel efficiency, and the effects of weight and other penalties imposed by changes in safety and emissions standards. While this process must be considerably compressed due to the limited time remaining for setting the MY 2004 standard, we will nonetheless consider all comments, including comments with data and analysis suggesting a level higher or lower than 20.7 mpg.

III. Impact Analyses

A. Economic Impacts

This proposal rule was reviewed by the Office of Management and Budget under Executive Order 12866, Regulatory Planning and Review. Although our proposed standard for MY 2004 does not differ from the fuel economy standards for the preceding model years, we are treating this rule as “economically significant” under Executive Order 12866 and “major” under the Congressional Review Act, 5 U.S.C. 801 et seq., as added by the Small Business Regulatory Enforcement Fairness Act of 1996. This proposal is also considered significant under the Department's regulatory policies and procedures.

As noted above, the agency has been operating under a restriction on the use of appropriations for the last six fiscal years. The restriction has prevented the agency from gathering and analyzing data relating to fuel economy capabilities and the costs and benefits of improving the level of fuel economy. Particularly since that restriction was lifted only very recently, on December 18, 2001, the agency has been unable to prepare an economic analysis for this rulemaking.

B. Environmental Impacts

C. Energy Impacts

NHTSA is not proposing to change the light truck CAFE standard for the 2004 model year. Assuming that this proposal is adopted in a final rule, this action will not have “a significant adverse effect on the supply, distribution, or use of energy,” as defined by Executive Order 13211, Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use. At this point, therefore, this action is not a “significant energy action” under Executive Order 13211 and no “Statement of Energy Effects” is required.

D. Impacts on Small Entities

Pursuant to the Regulatory Flexibility Act, the agency has considered the impact this rulemaking would have on small entities. I certify that this action would not have a significant economic impact on a substantial number of small entities. Therefore, a regulatory flexibility analysis is not required for this action. Few, if any, light truck manufacturers subject to the proposed rule would be classified as a “small business” under the Regulatory Flexibility Act.

The Regulatory Flexibility Act of 1980 (Pub. L. 96-354) requires each agency to evaluate the potential effects of a rule on small businesses. Establishment of a fuel economy standard for light trucks affects motor vehicle manufacturers, few of which are small entities. The Small Business Administration (SBA) has set size standards for determining if a business within a specific industrial classification is a small business. The Standard Industrial Classification code used by the SBA for Motor Vehicles and Passenger Car Bodies (3711) defines a small manufacturer as one having 1,000 employees or fewer.

Very few single stage manufacturers of motor vehicles within the United States have 1,000 or fewer employees. Those that do are not likely to have sufficient resources to design, develop, produce and market a light truck. For this reason, we certify that this proposal regarding the corporate average fuel economy of light trucks would not have a significant economic impact on a substantial number of small entities.

E. Federalism

E.O. 13132 requires NHTSA to develop an accountable process to ensure “meaningful and timely input by State and local officials in the development of regulatory policies that have federalism implications.” E.O. 13132 defines the term “Policies that have federalism implications” to include regulations that have “substantial direct effects on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government.” Under E.O. 13132, NHTSA may not issue a regulation that has federalism implication, that imposes substantial direct compliance costs, and that is not required by statute, unless the Federal government provides the funds necessary to pay the direct compliance costs incurred by State and local governments, or NHTSA consults with State and local officials early in the process of developing the proposed regulation.

This proposal would not have substantial direct effects on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government as specified in E.O. 13132. Thus, the requirements of section 6 of the Executive Order do not apply to this proposal.

F. The Unfunded Mandates Reform Act

The Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4) requires agencies to prepare a written assessment of the costs, benefits and other effects of proposed or final rules that include a Federal mandate likely to result in the expenditure by State, local or tribal governments, in the aggregate, or by the private sector, of more than $100 million annually. For the same reasons discussed in the section above on economic impacts, the agency has been unable to prepare an assessment.

G. Paperwork Reduction Act

There are no information collection requirements in this proposal.

H. Regulation Identifier Number (RIN)

The Department of Transportation assigns a regulation identifier number (RIN) to each regulatory action listed in the Unified Agenda of Federal Regulations. The Regulatory Information Service Center publishes the Unified Agenda in April and October of each year. You may use the RIN contained in the heading at the beginning of this document to find this action in the Unified Agenda.

I. Plain Language

Executive Order 12866 and the President's memorandum of June 1, 1998, require each agency to write all rules in plain language. Application of the principles of plain language includes consideration of the following questions:

—Have we organized the material to suit the public's needs?

—Are the requirements in the proposal clearly stated?

—Does the proposal contain technical language or jargon that is not clear?

—Would a different format (grouping and order of sections, use of headings, paragraphing) make the rule easier to understand?

—Would more (but shorter) sections be better?

—Could we improve clarity by adding tables, lists, or diagrams?

—What else could we do to make the proposal easier to understand?

If you have any responses to these questions, please forward them to Otto Matheke, Office of Chief Counsel, National Highway Traffic Safety Administration, 400 Seventh Street, S.W., Washington, DC 20590.

J. Executive Order 13045

Executive Order 13045 (62 FR 19885, April 23, 1997) applies to any rule that: (1) is determined to be economically significant as defined under E.O. 12866, and (2) concerns an environmental, health or safety risk that NHTSA has reason to believe may have a disproportionate effect on children. If the regulatory action meets both criteria, we must evaluate the environmental health or safety effects of the planned rule on children, and explain why the planned regulation is preferable to other potentially effective and reasonably feasible alternatives considered by us.

This rulemaking does not have a disproportionate effect on children. The primary effect of this rulemaking is to conserve energy resources by setting a fuel economy standard for light trucks.

K. National Technology Transfer and Advancement Act

Section 12(d) of the National Technology Transfer and Advancement Act (NTTAA) requires NHTSA to evaluate and use existing voluntary consensus standards ^[1] in its regulatory activities unless doing so would be inconsistent with applicable law (e.g., the statutory provisions regarding NHTSA's vehicle safety authority) or otherwise impractical. In meeting that requirement, we are required to consult with voluntary, private sector, consensus standards bodies. Examples of organizations generally regarded as voluntary consensus standards bodies include the American Society for Testing and Materials (ASTM), the Society of Automotive Engineers (SAE), and the American National Standards Institute (ANSI). If NHTSA does not use available and potentially applicable voluntary consensus standards, we are required by the Act to provide Congress, through OMB, an explanation of the reasons for not using such standards.

We are not aware of any available and potentially applicable voluntary consensus standards, i.e., ones regarding the maximum feasible level of corporate average fuel economy for MY 2004 light trucks. Therefore, this proposal is not based on any voluntary consensus standards.

L. Department of Energy Review

In accordance with 49 U.S.C. 32902(j), we submitted this proposal to the Department of Energy for review. That Department did not make any comments that we have not responded to.

IV. Comments

Submission of Comments

How Can I Influence NHTSA's Thinking on This Proposed Rule?

In developing our rules, we try to address the concerns of all our stakeholders. Your comments will help us improve this rule. We invite you to provide views on our proposal, new data, a discussion of the effects of this proposal on you, or other relevant information. We welcome your views on all aspects of this proposed rule. Your comments will be most effective if you follow the suggestions below:

• Explain your views and reasoning as clearly as possible.
• Provide solid technical and cost data to support your views.
• If you estimate potential costs, explain how you arrived at the estimate.
• Provide specific examples to illustrate your concerns.
• Offer specific alternatives.
• Be sure to include the name, date, and docket number with your comments.

How Do I Prepare and Submit Comments?

Your comments must be written and in English. To ensure that your comments are correctly filed in the Docket, please include the docket number of this document in your comments.

Your comments must not be more than 15 pages long. (49 CFR 553.21). We established this limit to encourage you to write your primary comments in a concise fashion. However, you may attach necessary additional documents to your comments. There is no limit on the length of the attachments.

Please submit two copies of your comments, including the attachments, to Docket Management at the address given above under ADDRESSES. Comments may also be submitted to the docket electronically by logging onto the Dockets Management System website at http://dms.dot.gov. Click on “Help & Information” or “Help/Info” to obtain instructions for filing the document electronically.

How Can I Be Sure That My Comments Were Received?

If you wish Docket Management to notify you upon its receipt of your comments, enclose a self-addressed, stamped postcard in the envelope containing your comments. Upon receiving your comments, Docket Management will return the postcard by mail.

How Do I Submit Confidential Business Information?

If you wish to submit any information under a claim of confidentiality, you should submit three copies of your complete submission, including the information you claim to be confidential business information, to the Chief Counsel, NHTSA, at the address given above under FOR FURTHER INFORMATION CONTACT. In addition, you should submit two copies, from which you have deleted the claimed confidential business information, to Docket Management at the address given above under ADDRESSES. When you send a comment containing information claimed to be confidential business information, you should include a cover letter setting forth the information specified in our confidential business information regulation. (49 CFR Part 512.)

Will the Agency Consider Late Comments?

We will consider all comments that Docket Management receives before the close of business on the comment closing date indicated above under DATES. To the extent possible, we will also consider comments that Docket Management receives after that date. If Docket Management receives a comment too late for us to consider it in developing a final rule (assuming that one is issued), we will consider that comment as an informal suggestion for future rulemaking action.

How Can I Read the Comments Submitted by Other People?

You may read the comments received by Docket Management at the address given above under ADDRESSES. The hours of the Docket are indicated above in the same location.

You may also see the comments on the Internet. To read the comments on the Internet, take the following steps:

(1) Go to the Docket Management System (DMS) Web page of the Department of Transportation (http://dms.dot.gov/​).

(2) On that page, click on “search.”

(3) On the next page (http://dms.dot.gov/​search/​),, type in the four-digit docket number shown at the beginning of this document. Example: If the docket number were “NHTSA-1998-1234,” you would type “1234.” After typing the docket number, click on “search.”

(4) On the next page, which contains docket summary information for the docket you selected, click on the desired comments. You may download the comments. The “pdf” versions of the documents are word searchable.

Please note that even after the comment closing date, we will continue to file relevant information in the Docket as it becomes available. Further, some people may submit late comments. Accordingly, we recommend that you periodically check the Docket for new material.

Plain Language

Executive Order 12866 and the President's memorandum of June 1, 1998, require each agency to write all rules in plain language. Application of the principles of plain language includes consideration of the following questions:

—Have we organized the material to suit the public's needs?

—Are the requirements in the rule clearly stated?

—Does the rule contain technical language or jargon that is not clear?

—Would a different format (grouping and order of sections, use of headings, paragraphing) make the rule easier to understand?

—Would more (but shorter) sections be better?

—Could we improve clarity by adding tables, lists, or diagrams?

—What else could we do to make the rule easier to understand?

If you have any responses to these questions, please include them in your comments on this proposal.

V. Conclusion

Based on the foregoing, we are proposing to establish the combined average fuel economy standard for non-passenger automobiles (light trucks) for MY 2004 at 20.7 mpg.

List of Subjects in 49 CFR Part 533

• Energy conservation
• Fuel economy
• Motor vehicles

In consideration of the foregoing, 49 CFR Part 533 is amended as follows:

PART 533—[AMENDED]

1. The authority citation for part 533 continues to read as follows:

Authority: 49 U.S.C. 32902; delegation of authority at 49 CFR 1.50.

2. Section 533.5 is amended by revising Table IV in paragraph (a) to read as follows:

§ 533.5

Requirements.

(a) * * *

Table IV

Model year	Standard
1996	20.7
1997	20.7
1998	20.7
1999	20.7
2000	20.7
2001	20.7
2002	20.7
2003	20.7
2004	20.7

* * * * *

Issued on: January 17, 2002.

Stephen R. Kratzke,

Associate Administrator for Safety Performance Standards.

Footnotes

1.  Voluntary consensus standards are technical standards developed or adopted by voluntary consensus standards bodies. Technical standards are defined by the NTTAA as “performance-based or design-specific technical specifications and related management systems practices.” They pertain to “products and processes, such as size, strength, or technical performance of a product, process or material.”