[Federal Register Volume 70, Number 26 (Wednesday, February 9, 2005)]
[Notices]
[Pages 6924-6925]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 05-2473]


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DEPARTMENT OF TRANSPORTATION

National Highway Traffic Safety Administration

[Docket No. NHTSA-2005-20288, Notice 1]


Cross Lander USA; Receipt of Application for a Temporary 
Exemption From Federal Motor Vehicle Safety Standard No. 208

    In accordance with the procedures of 49 CFR part 555, Cross Lander 
USA (``Cross Lander'') has applied for a Temporary Exemption from the 
automatic restraint requirements of Federal Motor Vehicle Safety 
Standard (FMVSS) No. 208, ``Occupant crash protection.'' The basis of 
the application is that compliance would cause substantial economic 
hardship to a manufacturer that has tried in good faith to comply with 
the standard.
    We are publishing this notice of receipt of the application in 
accordance with the requirements of 49 U.S.C. 30113(b)(2), and have 
made no judgment on the merits of the application.

I. Background

    Cross Lander seeks to import and distribute a multipurpose 
passenger vehicle, the Cross Lander 244X, manufactured in Romania. 
According to the petitioner, the 244X was previously known as ``ARO,'' 
and was ``built for extreme off road use and such were used by many 
armies and NATO forces.'' Over 360,000 ARO vehicles were manufactured 
from 1957 until 1989. The petitioner describes the 244X as similar in 
off-road capability to Hummer H-1 vehicles manufactured by General 
Motors. Although Cross Lander has negotiated with an air bag 
manufacturer for the design and testing of an air bag system for its 
vehicle, completion of the air bag development is not economically 
viable without additional revenue generated through immediate sales of 
the 244X in the United States.
    A description of the 244X is set forth in the petition (Docket No. 
NHTSA-2005-20288). For additional information on the 244X, please go to 
http://www.crosslander4x4.com/.

II. Why Cross Lander Needs a Temporary Exemption

    Because of an unexpected change in the choice of engine equipped on 
the 244X, the Gross Vehicle Weight Rating (GVWR) of the 244X is less 
than 5,500 pounds. However, in preparing the 244X for sale in the 
United States, the petitioner anticipated that the vehicle would have a 
higher GVWR. Because a heavier vehicle would not have been subject to 
the applicable automatic restraint requirements of FMVSS No. 208, the 
petitioner was not prepared to equip the 244X with a suitable air bag 
system.
    According to the petitioner, the cost of making the 244X compliant 
with FMVSS No. 208 on short notice is beyond the company's current 
capabilities. Thus, Cross Lander requests a two-year exemption in order 
to develop a compliant automatic restraint system.
    The petition indicates that Cross Lander has invested over $2 
million into the company. The petitioner's draft financial statements 
indicate a net loss of $653,307 for the fiscal year ending 12/31/2002, 
and a net loss of $383,633 for the for the fiscal year ending 12/31/
2003.\1\ Additionally, a 2004 cash flow analysis projects a net loss of 
$1,602,433.\2\ The agency requested that Cross Lander provide updated 
financial statements for years 2002 through 2004 and will examine this 
information before arriving at our decision on this application.
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    \1\ See Petition Attachment Draft Financial Statements (Docket 
No. NHTSA-2005-20288).
    \2\ See Petition Attachment 1 (Docket No. NHTSA-2005-20288).
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    The petitioner expected to derive initial revenue from sales of 
dealership licenses. However, if the Cross Lander MPV cannot be sold in 
the United States, no additional dealership licenses will be sold, and 
existing dealers would be entitled to a full refund. In short, the 
company would cease operations unless it is able to begin selling their 
product in the immediate future.

III. Why Compliance Would Cause Substantial Economic Hardship and How 
Cross Lander Has Tried in Good Faith To Comply With FMVSS No. 208 and 
the Bumper Standard

    As previously discussed, the petitioner contends that failure to 
obtain a two-year exemption from the requirements of FMVSS No. 208 
would result in Cross Lander closing its operations because it would 
not be able to sell any vehicles or maintain its dealer network.
    Cross Lander examined several air bag manufacturers and chose 
Siemens to develop its air bag system. The estimated cost of developing 
an advanced air bag system to meet FMVSS No. 208 is $1.2 million. The 
project would take approximately 18 months.\3\ Because Cross Lander has 
no current vehicles for sale in the United States, it is impossible to 
finance this project without a source of revenue. The petitioner 
contends that a two-year exemption would allow the Cross Lander to 
successfully develop a suitable air bag system.
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    \3\ See Siemens Report, Attachment 2 (Docket No. NHTSA-2005-
20288).
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IV. Why an Exemption Would Be in the Public Interest and Consistent 
With the Objectives of Motor Vehicle Safety

    The petitioner put forth several arguments in favor of a finding 
that the requested exemption is consistent with the public interest and 
the objectives of the Safety Act. Specifically:
    1. The petitioner argues that the 244X is likely to be used 
extensively off-road and would not travel frequently on

[[Page 6925]]

public roads. In fact, the vehicle is designed specifically for that 
purpose and is not equipped with many ``comfort features'' normally 
associated with everyday driving. The vehicle is also equipped with a 
special, heavy-duty suspension. Further, the vehicle's top speed is set 
relatively low at 70 mph.
    2. The petitioner argues that a series of crash tests, including 
the dynamic FMVSS No. 214 test indicate that the 244X is ``very 
crashworthy.''
    3. The petitioner suggests that over 100 people in the U.S. and 
1,200 people in Romania may be in danger of losing their jobs if Cross 
Lander is forced to close its U.S. operations.
    4. Finally, the petitioner states that 244X purchasers will be 
sufficiently warned about the lack of air bags. First, ``significant'' 
warning labels would inform the driver that the exempted vehicle is not 
equipped with air bags. Second, this information would also appear in 
the owner's manual. Third, an instructional video accompanying each 
244X would again warn drivers that the vehicle does not come with air 
bags.

V. How You May Comment on Cross Lander Application

    We invite you to submit comments on the application described 
above. You may submit comments [identified by DOT Docket Number NHTSA-
2005-20288] by any of the following methods:
     Web Site: http://dms.dot.gov. Follow the instructions for 
submitting comments on the DOT electronic docket site by clicking on 
``Help and Information'' or ``Help/Info.''
     Fax: 1-202-493-2251.
     Mail: Docket Management Facility, U.S. Department of 
Transportation, 400 Seventh Street, SW., Nassif Building, Room PL-401, 
Washington, DC 20590.
     Hand Delivery: Room PL-401 on the plaza level of the 
Nassif Building, 400 Seventh Street, SW., Washington, DC, between 9 
a.m. and 5 p.m., Monday through Friday, except Federal holidays.
     Federal eRulemaking Portal: Go to http://www.regulations.gov. Follow the online instructions for submitting 
comments.
    Instructions: All submissions must include the agency name and 
docket number or Regulatory Identification Number (RIN) for this 
rulemaking. Note that all comments received will be posted without 
change to http://dms.dot.gov, including any personal information 
provided.
    Docket: For access to the docket in order to read background 
documents or comments received, go to http://dms.dot.gov at any time or 
to Room PL-401 on the plaza level of the Nassif Building, 400 Seventh 
Street, SW., Washington, DC, between 9 a.m. and 5 p.m., Monday through 
Friday, except Federal holidays.
    Privacy Act: Anyone is able to search the electronic form of all 
comments received into any of our dockets by the name of the individual 
submitting the comment (or signing the comment, if submitted on behalf 
of an association, business, labor union, etc.). You may review DOT's 
complete Privacy Act Statement in the Federal Register published on 
April 11, 2000 (Volume 65, Number 70; Pages 19477-78) or you may visit 
http://dms.dot.gov.
    We shall consider all comments received before the close of 
business on the comment closing date indicated below. To the extent 
possible, we shall also consider comments filed after the closing date. 
We shall publish a notice of final action on the application in the 
Federal Register pursuant to the authority indicated below.
    Comment closing date: March 11, 2005.

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

FOR FURTHER INFORMATION CONTACT: George Feygin in the Office of Chief 
Counsel, NCC-112 (Phone: 202-366-2992; Fax 202-366-3820; E-Mail: 
[email protected]).

    Issued on: February 3, 2005.
Stephen R. Kratzke,
Associate Administrator for Rulemaking.
[FR Doc. 05-2473 Filed 2-8-05; 8:45 am]
BILLING CODE 4910-59-P