[Federal Register Volume 60, Number 141 (Monday, July 24, 1995)]
[Proposed Rules]
[Pages 37861-37864]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-18044]
=======================================================================
-----------------------------------------------------------------------
DEPARTMENT OF TRANSPORTATION
National Highway Traffic Safety Administration
49 CFR Part 531
[Docket No. 95-51; 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 Rolls-
Royce Motors, Ltd. (Rolls-Royce) requesting that it be exempted from
the generally applicable average fuel economy standard of 27.5 miles
per gallon (mpg) for model year 1997, and that a lower alternative
standard be established. In this document, NHTSA proposes that the
requested exemption be granted and that an alternative standard of 15.1
mpg be established for MY 1997 for Rolls-Royce.
DATES: Comments on this proposed decision must be received on or before
September 7, 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: Mr. Orron Kee, Office of Market
Incentives, NHTSA, 400 Seventh Street, SW, Washington, DC 20590. Mr.
Kee's telephone number is: (202) 366-0846.
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.
[[Page 37862]]
Background Information on Rolls-Royce
Rolls-Royce is a small company concentrating wholly on the
production of high quality, prestigious cars. Rolls-Royce markets cars
under the Bentley and Rolls-Royce nameplates and currently seeks an
exemption for both Bentley and Rolls-Royce cars. The annual production
rate for these cars is approximately 1,600 automobiles, of which one-
third are sold in the United States. The corporate philosophy
concentrates on this limited production as the only way to maintain
their reputation for producing what is widely perceived as the best car
in the world. It believes that its customers will continue to demand
substantial cars, craftsman-built, using traditional materials and
equipped to the highest standards. Rolls-Royce operates as an
independent unit within the Vickers group of companies and is required
to generate its own financial resources. The limited financial
resources of this small company and its market position preclude Rolls-
Royce from improving fuel economy by any means involving significant
changes to the basic concept of a Rolls-Royce car.
Fuel economy improvements are particularly difficult in the short
run. Rolls-Royce manufactures its own engine and bodies and is a very
low volume manufacturer. Because of this integration of component
manufacturing and low volume, model changes are much less frequent than
with larger manufacturers. Rolls-Royce may manufacture a body shell for
fifteen years before making a major change. The opportunities for
improving fuel economy through changing the model mix are also quite
limited as Rolls-Royce manufactures only one basic model in different
configurations and all have similarly low fuel economy.
Roll's Royce's ability to make long term fuel economy improvements
is also very limited. Any change in the basic concept of its cars to
reduce size or downgrade the specifications would not, according to the
petitioner, be acceptable to its customers.
Nevertheless, Rolls-Royce states that it is making every effort to
achieve the lowest possible fuel consumption consistent with meeting
emission, safety, and other standards while maintaining customer
expectations of its product. In the 17-year period from 1978, when
Federal fuel economy standards were introduced, Rolls-Royce has
achieved a fuel economy improvement of approximately 30 percent by
substituting lighter weight components and tuning its powertrain while
leaving basic features of the vehicles unchanged.
Rolls-Royce states that technical innovation and switching to
lighter weight materials should result in worthwhile improvements in
its vehicles. The company believes that it has been conscious of the
need for weight saving for many years, and since the introduction of
the Silver Shadow, has made many parts of aluminum. These include the
engine block and cylinder heads, transmission and axle casings, doors,
hood and deck lid.
In addition to discussing opportunities for weight reduction,
Rolls-Royce also included in its petition discussions of improving its
fuel economy through mix shifts, engine improvements, and drive train
and transmission improvements.
Rolls-Royce's Petition
On November 30, 1994, Rolls-Royce petitioned NHTSA for an exemption
from the average fuel economy standards for vehicles to be manufactured
by Rolls-Royce in model year (MY) 1997. A number of petitions have been
filed by Rolls-Royce covering all model years from 1978. The last was
submitted October 1992, which resulted in Rolls-Royce being granted an
exemption from the generally applicable fuel economy standard for MYs
1995 through 1996.
Methodology Used to Project Maximum Feasible Average Fuel
Economy Level for Rolls-Royce
Baseline Fuel Economy
To project the level of fuel economy which could be achieved by
Rolls-Royce in MY 1997, the agency considered whether there were
technical or other improvements that would be feasible for these Rolls-
Royce vehicles, whether or not the company currently plans to
incorporate such improvements in those vehicles. The 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 Rolls-Royce for use on its MY
1997 automobiles, and which would improve the fuel economy of those
automobiles. The areas examined for technologically feasible
improvements were weight reduction, engine improvements, and drive line
improvements.
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 MY
1997 automobiles. In assessing that capability, the agency has always
considered market demand since it is an implicit part of the concept of
economic practicability. Consumers need not purchase what they do not
want.
In accordance with the concerns of economic practicability, NHTSA
has considered only those improvements which would be compatible with
the basic design concepts of Rolls-Royce automobiles. NHTSA assumes
that Rolls-Royce will continue to produce a five-passenger luxury car.
Hence, design changes that would make the cars unsuitable for five
adult passengers with luggage or would remove items traditionally
offered on luxury cars, such as air conditioning, automatic
transmission, power steering, and power windows, were not examined.
Such changes to the basic design could 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.
Mix Shift
Rolls-Royce has little opportunity for improving fuel economy by
changing the model mix since it makes only one basic model in various
configurations, all with similarly low fuel economy. The differences in
fuel economy values among the different models available in MY 1997
will likewise be small. For the 1997 model year, Rolls-Royce and
Bentley cars will fall into five fuel economy configurations, three
from the naturally aspirated engine family and two from the
turbocharged engine family with the range of curb weights from 5,360
lbs to 6,100 lbs. The differences in fuel economy values between the
different models are small, and the models with the lower projected
fuel economies have significantly lower projected volumes. The Rolls-
Royce model mix is essentially fixed by the market demand, and
variations in sales percentages between the models would produce
negligible improvement in CAFE.
Weight Reduction
Rolls-Royce is conscious of the need to improve automotive fuel
economy of its passenger vehicles. Work had begun to design a lighter
and more fuel efficient model which included new features such as a
lighter bodyshell, engine, transmission, suspension, and other
components. However, the company's financial resources are limited
compared to other manufacturers, therefore its plans had to be re-
evaluated.
[[Page 37863]]
In addition, Rolls-Royce had to modify its passenger cars to
accommodate a number of safety standards and environmental regulations
which resulted in an increase in vehicle weight. A front passenger air
bag was introduced to comply with the requirements of FMVSS No. 208 for
passive restraints. The air conditioning system was substantially
revised to enable the use of HC 134a refrigerant in place of the
previously used CFC 12.
Rolls-Royce, being a small manufacturer of prestigious automobiles,
cannot afford to change the design of its cars by downsizing since its
customers desire traditional size cars.
Engine Improvements
The current petition from Rolls-Royce restates past efforts to
improve fuel economy in addressing engine improvements. Past
developmental activities include test and evaluation of various
technologies applied to the Rolls-Royce engine. These included the
Texaco Controlled Combustion system, the Honda Compound Vortex
Controlled Combustion system, diesel engines, cylinder disablement,
increased engine displacement (to reduce NO emissions and permit timing
for improved fuel economy), the May ``Fireball'' combustion chamber,
and overall downsizing of the engine and car incorporating all new
features including bodyshell, engine, transmission, and suspension.
Each of these approaches was discarded in turn as failing to provide a
feasible option for simultaneously meeting fuel economy and emission
requirements, and exacting customer expectations.
For MY 1994, Rolls-Royce introduced a package of engine and
emission system improvements. The principal feature was a revised
induction system incorporating a multi-point sequentially pulsed fuel
injection system, and an advanced ignition system with an individual
coil for each cylinder. Both systems are controlled by a central engine
management microprocessor. The fuel injection system improves control
and precision of fuel metering for improved emission control and fuel
economy during warm-up. The ignition system improvements anticipate
regulatory requirements for emission control diagnostics.
Transmission and Drive Train Improvements
Rolls-Royce uses the General Motors 4L80-E four-speed automatic
transmission with torque converter lockup clutch on all models
beginning in MY 1992. Use of the fourth gear as an overdrive ratio has
shown the capability of improving fuel economy by approximately 14
percent under highway driving conditions. The rear axle ratio was
reduced on the Bentley Turbo R and Bentley Continental R, thereby
improving the top gear engine-to-vehicle speed ratio from 28.5 rpm/mph
to 24.9 rpm/mph. This improved the highway fuel economy of this model
by about 5 percent.
Effect of Other Motor Vehicle Standards
The Rolls-Royce petition cites exhaust emission standards as having
the greatest effect on fuel economy, and for this reason the company
considers the fuel economy program to be an integral part of its
emission control program. It states that, historically, emission
standards have placed a severe strain on its limited technical
resources; and only with the introduction of new emission control
techniques such as oxidation and three way catalysts has the trend to
higher fuel consumption been reversed.
As a small volume manufacturer, Rolls-Royce was not subject to the
recently agreed upon stringent California emission standards until the
1995 model year. The more stringent Federal Clean Air Act Amendment
standards will not apply until the 1996 model year.
Of the Federal regulations having an adverse effect on fuel
economy, Rolls-Royce considers the most significant ones to be 49 CFR
Part 581 (energy absorbing bumpers), FMVSS 214 (side intrusion beam in
doors), and FMVSS 208 (passive restraints). The passive restraint
systems (air bags) forced some models to move into the 6,000 lbs and
6,500 lbs inertia weight classes. The effect of these regulations
increased vehicle weight despite efforts to reduce weight. Rolls-Royce
is a small company and engineering resources are limited and priority
must be given to meeting mandatory standards in order to remain in the
marketplace. Conflict often exists between the priority of meeting
standards and the need to remain competitive.
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 Rolls-Royce to
achieve an average fuel economy in MY 1997 above 15.1 mpg. Granting an
exemption to Rolls-Royce 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. In
fact, there would not be any increase since Rolls-Royce cannot attain
those generally applicable standards. Nevertheless, for illustrative
purposes the agency estimates that the additional fuel consumed by
operating the MY 1997 fleet of Rolls-Royce vehicles at the company's
projected CAFE of 15.1 mpg (compared to an hypothetical 27.5 mpg fleet)
over 106,952 miles is 36,378 bbls. of fuel. This averages about 8.30
bbls. of fuel per day over the 12-year period that these cars will be
an active part of the fleet. Obviously, this is insignificant compared
to the daily fuel used by the entire motor vehicle fleet which amounts
to some 4.90 million bbls. per day for passenger cars in the U.S. in
1993.
Maximum Feasible Average Fuel Economy for Rolls-Royce
This agency has tentatively concluded that it would not be
technologically feasible and economically practicable for Rolls-Royce
to improve the fuel economy of its MY 1997 automobiles above an average
of 15.1 mpg, that compliance with other Federal automobile standards
would not adversely affect achievable fuel economy beyond the amount
already factored into Rolls-Royce's projections, and that 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 Rolls-Royce in MY 1997 is 15.1 mpg.
Proposed Level and Type of Alternative Standard
The agency proposes to exempt Rolls-Royce from the generally
applicable standard of 27.5 mpg and to establish an alternative
standard for Rolls-Royce for MY 1997 at its maximum feasible average
fuel economy of 15.1 mpg. NHTSA tentatively concludes that it would be
appropriate to establish a separate standard for Rolls-Royce for the
following reasons. The agency has already received a petition and
published a proposal (60 FR 31937, June 19, 1995) for an alternate
standard for MedNet, Inc. for MY's 1996, 1997, and 1998 seeking an
alternate standard for that company of 17.0 mpg. Therefore, the agency
cannot use the second (class standards) or third (single standard for
all exempted manufacturers) approaches for MY 1997.
[[Page 37864]]
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 Rolls-Royce, 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 Rolls-Royce's
maximum feasible level for MY 1997, no fuel would be saved by
establishing a higher alternative standard. NHTSA finds that because of
the minuscule size of the Rolls-Royce fleet, that incremental usage of
gasoline by Rolls-Royce's and 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 exemption
and alternative standard. Further, since the exempted passenger
automobiles cannot achieve better fuel economy than is proposed herein,
granting this proposed exemption 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
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.
Sec. 531.5 [Amended]
2. In section 531.5, the introductory text of paragraph (b) is
republished for the convenience of the reader and paragraph (b)(2)
would be revised 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:
* * * * *
(2) Rolls-Royce Motors, Inc.
------------------------------------------------------------------------
Average fuel
economy
Model year standard
(miles per
gallon)
------------------------------------------------------------------------
1978.................................................... 10.7
1979.................................................... 10.8
1980.................................................... 11.1
1981.................................................... 10.7
1982.................................................... 10.6
1983.................................................... 9.9
1984.................................................... 10.0
1985.................................................... 10.0
1986.................................................... 11.0
1987.................................................... 11.2
1988.................................................... 11.2
1989.................................................... 11.2
1990.................................................... 12.7
1991.................................................... 12.7
1992.................................................... 13.8
1993.................................................... 13.8
1994.................................................... 13.8
1995.................................................... 14.6
1996.................................................... 14.6
1997.................................................... 15.1
------------------------------------------------------------------------
* * * * *
Issued on: July 18, 1995.
Barry Felrice,
Associate Administrator for Safety Performance Standards.
[FR Doc. 95-18044 Filed 7-21-95; 8:45 am]
BILLING CODE 4910-59-P