[Federal Register Volume 64, Number 174 (Thursday, September 9, 1999)]
[Notices]
[Pages 49049-49050]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-23428]
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DEPARTMENT OF TRANSPORTATION
National Highway Traffic Safety Administration
[Docket No. NHTSA-98-3355; Notice 4]
Red River Manufacturing, Inc.; Grant of Application for Renewal
of Temporary Exemption From Federal Motor Vehicle Safety Standard No.
224
For the reasons explained below, we are granting the application by
Red River Manufacturing, Inc., of West Fargo, North Dakota, for a
renewal of NHTSA Temporary Exemption No. 98-3 from Motor Vehicle Safety
Standard No. 224, Rear Impact Protection. Red River applied again on
the basis that ``compliance would cause substantial economic hardship
to a manufacturer that has tried in good faith to comply with the
standard.'' 49 CFR 555.6(a).
We published notice of receipt of the application on March 5, 1999,
and afforded an opportunity for comment (64 FR 10737).
We granted Red River a 1-year temporary exemption from Standard No.
224 on April 1, 1998 (63 FR 15909). The exemption was to expire on
April 1, 1999, but Red River filed a timely application for renewal,
and, as provided by 49 CFR 555.8(e), the exemption will continue in
effect until we make a decision on its application. The company has
requested an extension of this exemption until April 1, 2002. The
discussion that follows is based on information contained in Red
River's application.
Why Red River Says That it Needs to Renew its Temporary Exemption
On April 1, 1998, we granted Red River a temporary exemption of one
year from Standard No. 224. See 63 FR 15909 for our decision.
Among other kinds of trailers, Red River manufactures and sells two
types of horizontal discharge trailers which discharge their contents
into hoppers, rather than on the ground. This makes it impractical to
comply with Standard No. 224 by using a fixed rear impact guard. One
type of horizontal discharge trailer is used in the road construction
industry to deliver asphalt and other road building materials to the
construction site. The other type is used to haul feed, seed, and
agricultural products such as sugar beets and potatoes, from the fields
to hoppers for storage or processing. Both types are known by the name
``Live Bottom.''
Standard No. 224 requires, effective January 26, 1998, that all
trailers with a GVWR of 4536 Kg or more, including Live Bottom
trailers, be fitted with a rear impact guard that conforms to Standard
No. 223, Rear impact guards. Red River, which manufactured 225 Live
Bottom trailers of all kinds in the 12 months preceding the filing of
its application on December 22, 1998, has asked for a renewal of its
exemption until April 1, 2002, in order to continue its efforts to
develop a rear impact guard that conforms to Standard No. 223 and can
be installed in compliance with Standard No. 224, while retaining the
functionality and price-competitiveness of its trailers.
Why Red River Says That Compliance Would Cause it Substantial
Economic Hardship
Live Bottoms accounted for almost half of Red River's production in
1997. In the absence of an exemption, Red River believes that
approximately 60 percent of its work force would have to be laid off.
Its projected loss of sales is $8,000,000 to $9,000,000 per year (net
sales have averaged $14,441,822 over its 1995, 1996, and 1997 fiscal
years).
We require hardship applicants to estimate the cost required to
comply with a standard, as soon as possible, and at the end of a one,
two, or three year exemption period. Red River estimates that even a 3-
year exemption will require a retail price increase that will result in
a loss of 35 percent of Live Bottom sales. Further, ``more than 50
percent of available engineering time would be required for compliance
and related modifications in this time frame, resulting in a
significant reduction in support for non-Live Bottom products, and a 5%
decline in non-Live Bottom sales.''
Why Red River Says That it Has Tried to Comply With the Standard in
Good Faith
In its initial application for a temporary exemption, Red River
explained that, in mid 1996, its design staff began exploring options
for compliance with Standard No. 224. Through a business partner in
Denmark, the company reviewed the European rear impact protection
systems. Because these designs must be manually operated by ground
personnel, Red River decided that they would not be acceptable to its
American customers. Later in 1996, Red River decided to investigate
powered retractable rear impact guards. The initial design could not
meet the energy absorption requirements of Standard No. 223. The
company then investigated the use of pneumatic-over-mechanical
retractable rear impact guards, and developed a prototype design which
it began testing in the field in May 1998. This testing is disclosing a
number of problems as yet unresolved. In the meantime, Red River
consulted three commercial suppliers of underride devices but none
produces a guard that could be used on the Live Bottoms.
Red River intends to continue its compliance efforts while an
exemption is in effect, and believes that three years will enable it to
conclude definitively whether it is feasible to design and manufacture
a compliant rear guard that meets the requirements of its customers,
and, if it is not feasible, to petition the agency for rulemaking to
exclude Live Bottoms from Standard No. 224.
Red River was able to conform its other trailers with Standard No.
224.
Why Red River Says That Exempting it Would Be Consistent with the
Public Interest and Objectives of Motor Vehicle Safety
In its initial application, Red River argued that an exemption
would be in the public interest and consistent with traffic safety
objectives because the Live Bottom ``can be used safely where it would
be hazardous or impractical to use end dump trailers, such as on uneven
terrain or in places with low overhead clearances.'' These trailers are
``valuable to the agricultural sector'' because of the advantages they
offer in the handling of relatively fragile cargo. An exemption ``would
have no adverse effect on the safety of the general public'' because
the Live Bottom spends very little of its operating life on the highway
and the likelihood of its being involved in a rear-end collision is
minimal. In addition, the design of the Live Bottom is such that the
rear tires act as a buffer and reduce the likelihood of impact with the
trailer.
Red River reiterates these arguments in its application for renewal
of its temporary exemption. It adds that it knows of no rear end
collisions involving horizontal discharge trailers that have resulted
in injuries, nor any instances in which there has been an intrusion by
a horizontal discharge trailer into the passenger compartment of a
vehicle impacting the rear of such a trailer.
Comments Received From the Public on the Application
We received four comments on Red River's application for renewal of
its temporary exemption. Two commenters
[[Page 49050]]
opposed granting the renewal, and two commenters supported it.
Timpte Trailer Co. of David City, Nebraska, identified itself as a
manufacturer of bulk commodity trailers ``with the same limited
engineering resources'' as Red River, and opposed granting Red River's
request. Timpte related that it was able to design a ``live bottom''
trailer with a telescoping rear underride protection system ``which
complied with FMVSS 224 on its original effective date.'' However, this
added to the trailer's weight and cost, and Timpte says that the
exemptions granted Red River and two other ``live bottom''
manufacturers placed Timpte at an unfair competitive advantage. As a
consequence, it had to suspend production of its ``live bottom''
trailer and release approximately 20 percent of its workforce. Timpte
argues that Red River has had adequate time to comply with the
underride requirement, and that Timpte's system proves that this type
of trailer can be equipped with a workable rear underride protection
system that meets Federal requirements. It ``strongly objects'' to
extending Red River's exemption.
E.D. Entyre & Co. of Oregon, Illinois, filed a similar comment in
opposition. It designed a ``live bottom'' trailer with a retractable
rear underride guard which it introduced in August 1998. The total
engineering and test time spent on this retractable design ``was
approximately two man months and the mechanism has a manufacturing cost
of approximately $500.'' The company believes that the extension should
be denied ``since a solution has been shown to be technically
feasible,'' and complying companies have been placed at a competitive
disadvantage.
Red River's application was supported by Dan Hill & Associates,
Inc., which has been producing ``live bottom'' trailers pursuant to a
temporary exemption we gave it in 1998, and Robert J. Crail,
Transportation Engineering Consultant. Dan Hill states that it and Red
River have dominated the horizontal flow discharge trailer market for
the last few decades. In view of this experience, and understanding
that Entyre has produced less than 20 complying ``live bottom''
trailers, Dan Hill comments that ``Entyre's lack of experience in the
horizontal discharge market [may have] erroneously lead Entyre to
believe that it has successfully complied with a very complex issue.''
In any event, Dan Hill further comments that Entyre is a far larger
company than it and Red River, with ``considerably more resources to
allocate to research and development.'' With respect to Timpte, Dan
Hill comments that Timpte does not manufacture a horizontal discharge
trailer for the road construction industry and thus does not have the
problems associated with the asphalt paver/trailer interface.
Mr. Crail reiterates his previous support of Red River. He has
examined one of its trailers and is convinced ``that it will take at
least an additional three years for Red River to determine whether it
is feasible to manufacture an impact guard for these trailers.'' He
believes that the impact of an exemption upon safety will be minimal,
given the small number of trailers that would be covered by an
exemption and the fact that ``the Live Bottom trailers are used mostly
off roads.''
Our Findings and Decision
In granting a temporary exemption, we must find that a manufacturer
has made a good faith effort to comply with the standard from which it
has requested exemption. While the fact that another manufacturer may
have achieved compliance indicates that a particular technological
problem is not insoluble, it does not mean that a petitioner has failed
to make a good faith compliance effort. It does indicate, however,
that, during the period of any renewed exemption, a petitioner should
carefully examine these solutions for applicability to its own product.
The fact that Timpte and Entyre have commented that their ``live
bottom'' trailers comply with Standard No. 224 should alert Red River
that an alternative may exist to the prototype design that it began
testing in May 1998 and which has disclosed a number of problems. We
note that Red River's principal competitor, Dan Hill & Associates,
Inc., believes that it will have a complying ``swing-in'' guard by
February 1, 2001. For these reasons, we do not believe that Red River
has sustained its request for an exemption for a period as long as
April 1, 2002, and we are providing one commensurate with the extension
granted Dan Hill, until February 1, 2001.
In the absence of extending the exemption, it appears that Red
River could not produce trailers that have accounted for over 50
percent of its net sales, with the accompanying dislocation of its work
force that this would entail. Given the apparent minimal risk to safety
presented by a trailer that spends comparatively little of its life
being operated on the public roads (construction trailers) and in which
the rear tires can act as a buffer in the absence of an impact guard
(agricultural trailer), and the public interest in maintaining full
employment, Red River has met its burdens under the statutory
procedures.
Accordingly, for the reasons set forth above, we hereby find that
compliance with Standard No. 224 would cause substantial economic
hardship to a manufacturer that has tried in good faith to comply with
Standard No. 224, and that an exemption would be in the public interest
and consistent with the objectives of traffic safety. NHTSA Temporary
Exemption No. 98-3 from Federal Motor Vehicle Safety Standard No. 224,
Rear Impact Protection, applicable to horizontal discharge trailers, is
hereby extended to expire on February 1, 2001. That date is slightly
more than five years after Standard No. 224 was issued, and NHTSA does
not anticipate providing further extensions of exemptions from
compliance with Standard No. 224.
Authority: 49 U.S.C. 30113; delegations of authority at 49 CFR
1.50 and 501.4.
Issued on: September 1, 1999.
Ricardo Martinez,
Administrator.
[FR Doc. 99-23428 Filed 9-8-99; 8:45 am]
BILLING CODE 4910-59-P