[Federal Register Volume 62, Number 249 (Tuesday, December 30, 1997)]
[Notices]
[Pages 67931-67932]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-33954]


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DEPARTMENT OF TRANSPORTATION

National Highway Traffic Safety Administration

[Docket No. NHTSA-97-3268]


Panoz Auto Development Company; Receipt of Application for Second 
Renewal of Temporary Exemption From Federal Motor Vehicle Safety 
Standard No. 208

    Panoz Auto Development Company of Hoschton, GA., has applied for a 
second renewal of its exemption from paragraph S4.1.4 of Federal Motor 
Vehicle Safety Standard No. 208 Occupant Crash Protection. The basis of 
the reapplication is that compliance will cause substantial economic 
hardship to a manufacturer that has tried to comply with the standard 
in good faith.
    This notice of receipt of an application for renewal is published 
in accordance with the requirements of 49 U.S.C. 30113(b)(2) and does 
not represent any judgment of the agency on the merits of the 
application.
    Panoz received NHTSA Exemption No. 93-5 from S4.1.4 of Standard No. 
208, an exemption for two years which was initially scheduled to expire 
August 1, 1995 (58 FR 43007). It applied for, and received, a renewal 
of this exemption for an additional two years, scheduled to expire on 
November 1, 1997 (61 FR 2866). On August 28, 1997, NHTSA received 
Panoz's application for second renewal, which was more than 60 days 
before the scheduled expiration date of its exemption. In accordance 
with 49 CFR 555.8(e), Panoz's filing of its application before the 60th 
day stays the expiration until the Administrator grants or denies the 
application for second renewal.
    Panoz's original exemption was granted pursuant to the 
representation that its Roadster would be equipped with a Ford-supplied 
driver and passenger airbag system, and would comply with Standard No. 
208 by April 5, 1995 after estimated expenditures of $472,000. As of 
April 1993, the company had expended 750 man hours and $15,000 on the 
project.
    According to its 1995 application for renewal,

Panoz has continued the process of researching and developing the 
installation of a driver and passenger side airbag system on the 
Roadster since the original exemption petition was submitted to 
NHTSA on April 5, 1993. To date, an estimated 1680 man-hours and 
approximately $50,400 have been spent on this project.

    At that time, Panoz used a 5.0L Ford Mustang GT engine and five 
speed manual transmission in its car. Because ``the 1995 model year and 
associated emission components were revised by Ford'', this caused

a delay in the implementation of the airbag system on the Roadster 
due to further research and development time requirements and 
expenditure of additional monies to evaluate the effects of these 
changes on the airbag adaptation program.

    Shortly before filing its application for first renewal, Panoz 
learned that Ford was replacing the 5.0L engine and emission control 
system on the 1996 Mustang and other passenger cars with a modular 4.6L 
engine and associated emission components. The 1995 system did not meet 
1996 On-Board Diagnostic emission control requirements, and Panoz was 
faced with using the 1996 engine and emission control system as a 
substitute. The majority of the money and man hours at that time had 
been spent on adapting an airbag system to the 5.0L engine car, and the 
applicant had to concentrate on adapting it to a 4.6L engine car. Panoz 
listed eight types of modifications and testing necessary for 
compliance that would cost it $337,000 if compliance were required at 
the end of a one-year period. It asked for and received a two-year 
renewal of its exemption.
    However, Panoz found integration of the 4.6L engine into its 
existing chassis more difficult than anticipated, primarily because the 
4.6L was 10 inches wider than the engine it replaced. This required a 
total redesign of the chassis, requiring expenditure of ``a significant 
amount of resources.'' Simultaneously, it designed the vehicle to allow 
for the integration of the Ford Mustang driver-side and passenger-side 
airbag systems. Panoz describes these steps in some detail and 
estimates that between May 1995 and August 1997 it spent 2200 man-hours 
and $66,000 on these efforts. In the same time period, it spent $47,000 
in static and dynamic crash testing of a 4.6L car related to airbag 
system development. Panoz concludes by describing the additional 
modifications and testing required to adapt the Ford system to its car. 
These costs total $358,000. A two-year renewal of its exemption would 
provide sufficient time to generate sufficient income (approximately 
$15,000 a month through sales of vehicles and private

[[Page 67932]]

funding) to fund the modifications and testing.
    Panoz sold 13 cars in 1993 and 13 more in 1994. It did not state 
its sales in 1995. Because of the effort needed to meet Federal 
emission and safety requirements, Panoz did not build any 1996 model 
year vehicles. It reports sales of 23 model year 1997 vehicles in the 
12 months preceding its application for second renewal. At the time of 
its original petition, Panoz's cumulative net losses since 
incorporation in 1989 were $1,265,176. It lost an additional $249,478 
in 1993, $169,713 in 1994, $721,282 in 1995, and $1,349,241 in 1996.
    The applicant reiterated its original arguments that an exemption 
would be in the public interest and consistent with the objectives of 
traffic safety. Specifically, the Roadster is built in the United 
States and uses 100 percent U.S. components, bought from Ford and 
approximately 80 other companies. It provides employment for 45 full 
time and three part time employees. The Roadster is said to provide the 
public with a classic alternative to current production vehicles. It is 
the only vehicle that incorporates ``molded aluminum body panels for 
the entire car'', a process which continues to be evaluated by other 
manufacturers and which ``results in the reduction of overall vehicle 
weight, improved fuel efficiency, shortened tooling lead times, and 
increased body strength.'' With the exception of S4.1.4 of Standard No. 
208, the Roadster meets all other Federal motor vehicle safety 
standards including the 1997 side impact provisions of Standard No. 
214.
    Interested persons are invited to submit comments on the 
application described above. Comments should refer to the docket number 
and the notice number, and be submitted to: Docket Section, National 
Highway Traffic Safety Administration, room 5109, 400 Seventh Street, 
SW, Washington, DC 20590. It is requested but not required that 10 
copies be submitted.
    All comments received before the close of business on the comment 
closing date indicated below 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 after the 
closing date will also be considered. Notice of final action on the 
application will be published in the Federal Register pursuant to the 
authority indicated below.
Comment closing date: January 29, 1998.

(49 U.S.C. 30113; delegations of authority at 49 CFR 1.50. and 
501.8)

    Issued on December 23, 1997.
L. Robert Shelton,
Associate Administrator for Safety Performance Standards.
[FR Doc. 97-33954 Filed 12-29-97; 8:45 am]
BILLING CODE 4910-59-P