[Federal Register Volume 76, Number 66 (Wednesday, April 6, 2011)]
[Notices]
[Pages 19179-19182]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2011-8082]


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DEPARTMENT OF TRANSPORTATION

National Highway Traffic Safety Administration

[Docket No. NHTSA-2011-0030]


Spyker Automobielen B.V.; Receipt of Application for Extension of 
Temporary Exemption From Certain Requirements of FMVSS No. 208

AGENCY: National Highway Traffic Safety Administration (NHTSA), 
Department of Transportation (DOT).

ACTION: Notice of receipt of petition for extension of a temporary 
exemption from certain provisions of Federal Motor Vehicle Safety 
Standard (FMVSS) No. 208, Occupant Crash Protection.

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SUMMARY: In accordance with the procedures in 49 CFR Part 555, Spyker 
Automobielen B.V. (Spyker) has applied for an extension of a previously 
granted temporary exemption from certain advanced air bag requirements 
of FMVSS No. 208, Occupant Crash Protection, for its C line of 
vehicles. 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.
    NHTSA is publishing this notice of receipt of the application in 
accordance with the requirements of 49 U.S.C. 30113(b)(2), and has made 
no judgment on the merits of the application.

DATES: You should submit your comments not later than May 6, 2011.

FOR FURTHER INFORMATION CONTACT: William H. Shakely, Office of the 
Chief Counsel, NCC-112, National Highway Traffic Safety Administration, 
1200 New Jersey Avenue, SE., West Building 4th Floor, Room W41-212, 
Washington, DC 20590. Telephone: (202) 366-2992; Fax: (202) 366-3820.
    Comments: We invite you to submit comments on the application 
described above. You may submit comments identified by the docket 
number at the heading of this notice by any of the following methods:
     Web Site: http://www.regulations.gov. Follow the 
instructions for submitting comments on the electronic docket site by 
clicking on ``Help and Information'' or ``Help/Info.''
     Fax: 1-202-493-2251.
     Mail: U.S. Department of Transportation, Docket 
Operations, M-30, Room W12-140, 1200 New Jersey Avenue, SE., 
Washington, DC 20590.
     Hand Delivery: 1200 New Jersey Avenue, SE., West Building 
Ground Floor, Room W12-140, 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. Note that all comments received will be posted without 
change to http://www.regulations.gov, including any personal 
information provided. Please see the Privacy Act discussion below. We 
will consider all comments received before the close of business on the 
comment closing date indicated above. To the extent possible, we will 
also consider comments filed after the closing date.
    Docket: For access to the docket to read background documents or 
comments received, go to http://www.regulations.gov at any time or to 
1200 New Jersey Avenue, SE., West Building Ground Floor, Room W12-140, 
Washington, DC 20590, between 9 a.m. and 5 p.m., Monday through Friday, 
except Federal holidays. Telephone: (202) 366-9826.
    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://www.dot.gov/privacy.html.
    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 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. 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).

SUPPLEMENTARY INFORMATION: 

I. Overview of Petition for Economic Hardship Exemption

    In accordance with 49 U.S.C. 30113 and the procedures in 49 CFR 
part 555, Spyker has submitted a petition (dated October 13, 2010) 
asking the agency for

[[Page 19180]]

an extension of a temporary exemption from certain advanced air bag 
requirements of FMVSS No. 208 for its C line of vehicles. The existing 
exemption was set to expire on December 15, 2010. The basis for the 
application is that compliance would cause substantial economic 
hardship to a manufacturer that has tried in good faith to comply with 
the standard. After filing its petition, Spyker submitted additional 
information regarding its compliance efforts.
    The agency closely examines and considers the information provided 
by manufacturers in support of these factors, and, in addition, 
pursuant to 49 U.S.C. 30113(b)(3)(A), determines whether an exemption 
is in the public interest and consistent with the Safety Act.\1\ Spyker 
requested an extension until May 15, 2012. Copies of Spyker's petition 
and its supplemental statement \2\ are available for review and have 
been placed in the docket for this notice.
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    \1\ The Safety Act is codified as Title 49, United States Code, 
Chapter 301.
    \2\ Spyker has requested confidential treatment under 49 CFR 
Part 512 for certain business and financial information submitted as 
part of its petition for temporary exemption. Accordingly, the 
information placed in the docket does not contain the information 
that is the subject of this request.
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    A manufacturer is eligible to apply for a hardship exemption if its 
total motor vehicle production in its most recent year of production 
did not exceed 10,000 vehicles, as determined by the NHTSA 
Administrator (49 U.S.C. 30113).
    Additionally, although 49 U.S.C. 30113(b) states that exemptions 
from a Safety Act standard are to be granted on a ``temporary basis,'' 
\3\ the statute also expressly provides for renewal of an exemption on 
reapplication. Manufacturers are nevertheless cautioned that the 
agency's decision to grant an initial petition in no way predetermines 
that the agency will repeatedly grant renewal petitions, thereby 
imparting semi-permanent exemption from a safety standard. Exempted 
manufacturers seeking renewal must bear in mind that the agency is 
directed to consider financial hardship as but one factor, along with 
the manufacturer's on-going good faith efforts to comply with the 
regulation, the public interest, and consistency with the Safety Act 
generally, as well as other such matters provided in the statute.
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    \3\ 49 U.S.C. 30113(b)(1).
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    We note that under 49 CFR 555.8(e), ``If an application for renewal 
of a temporary exemption that meets the requirements of Sec.  555.5 has 
been filed not later than 60 days before the termination date of an 
exemption, the exemption does not terminate until the Administrator 
grants or denies the application for renewal.'' In this case, Spyker 
submitted its petition for extension by the deadline stated in 49 CFR 
555.8(e).

II. Advanced Air Bag Requirements and Small Volume Manufacturers

    The agency published the final rule requiring advanced air bags in 
May 2000. The rule was intended to improve protection for occupants of 
different sizes, belted and unbelted, under FMVSS No. 208, while 
minimizing the risk to infants, children, and other occupants from 
injuries and deaths caused by air bags. The rule accomplished this by 
establishing new test requirements and injury criteria and specifying 
the use of an entire family of test dummies: The then-existing dummy 
representing 50th percentile adult males, and new dummies representing 
5th percentile adult females, 6-year-old children, 3-year-old children, 
and 1-year-old infants.
    The advanced air bag requirements were a culmination of a 
comprehensive plan that the agency announced in 1996 to address the 
adverse effects of air bags. This plan also included an extensive 
consumer education program to encourage the placement of children in 
rear seats. The new requirements were phased in beginning with the 2004 
model year. The requirements did not apply to small manufacturers until 
September 1, 2006.
    In recent years, NHTSA has addressed a number of petitions for 
exemption from the advanced air bag requirements of FMVSS No. 208. The 
majority of these requests have come from small manufacturers that have 
petitioned on the basis of substantial economic hardship to a 
manufacturer that has tried in good faith to comply with the standard.
    Although NHTSA has granted a number of these petitions in 
situations where the manufacturer is supplying standard air bags in 
lieu of advanced air bags,\4\ NHTSA is considering (1) whether it is in 
the public interest to continue to grant such petitions, particularly 
in the same manner as in the past, given the number of years these 
requirements have now been in effect and the benefits of advanced air 
bags, and (2) to the extent such petitions are granted, what plans and 
countermeasures to protect child and infant occupants, short of 
compliance with the advanced air bags, should be expected.
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    \4\ See, e.g., grant of petition to Panoz, 72 FR 28759 (May 22, 
2007); grant of petition to Koenigsegg, 72 FR 17608 (April 9, 2007).
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    Given the passage of time since the advanced air bag requirements 
were established and have been implemented, and in light of the 
benefits of advanced air bags, NHTSA is concerned that it may not be in 
the public interest to continue to grant exemptions from these 
requirements, particularly in the same manner as in the past. The costs 
of compliance with the advanced air bag requirements of FMVSS No. 208 
are costs that all entrants to the U.S. automobile marketplace should 
expect to bear. Furthermore, NHTSA understands that, in contrast to the 
initial years after the advanced air bag requirements went into effect, 
low volume manufacturers now have access to advanced air bag 
technology. Accordingly, NHTSA tentatively concludes that the expense 
of advanced air bag technology may not now be sufficient, in and of 
itself, to justify the grant of a petition for a hardship exemption 
from the advanced air bag requirements.
    NHTSA further notes that exemptions from motor vehicle safety 
standards are to be granted on a ``temporary basis.'' \5\ In prior 
petitions, NHTSA has granted temporary exemptions from the advanced air 
bag requirements as a means of affording eligible manufacturers a 
transition period to comply with the exempted standard. Accordingly, in 
deciding whether to grant an exemption based on substantial economic 
hardship, NHTSA ordinarily considers the steps that the manufacturer 
has already taken to achieve compliance, as well as the future steps 
the manufacturer plans to take during the exemption period and the 
estimated date by which full compliance will be achieved.\6\
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    \5\ 49 U.S.C. 30113(b)(1).
    \6\ 49 CFR 555.6(a)(2).
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    NHTSA invites comment on whether and in what circumstances (e.g., 
nature of vehicles, number of vehicles, level of efforts to comply with 
the requirements, timing as to number of years since the requirements 
were implemented, etc.) it should continue to grant petitions for 
exemptions from the advanced air bag requirements of FMVSS No. 208. We 
note that any policy statements we may make in this area would not have 
the effect of precluding manufacturers from submitting subsequent 
petitions for exemption. However, we believe it could be helpful for 
manufacturers to know our general views in advance of submitting a 
petition.

[[Page 19181]]

III. Spyker's Petition

    Background--Spyker, a Netherlands corporation, was founded in 2000 
and has been producing a small number of luxury sports cars since 
February 2002. On July 6, 2005, NHTSA granted Spyker a three-year 
hardship exemption from several FMVSSs, including the ``basic'' air bag 
requirements and advanced air bag provisions of FMVSS No. 208 
(S4.1.5.3; S14), as well as 49 CFR part 581, Bumper Standard (70 FR 
39007 (July 6, 2005)). This exemption was set to expire on June 15, 
2008. In this same grant, NHTSA also exempted the first ten Spyker C8 
vehicles imported into the United States from S7 of FMVSS No. 108, 
Lamps, reflective devices, and associated equipment.
    On March 25, 2009, NHTSA granted Spyker a 30-month limited 
extension from the child and 5th percentile adult female driver out-of-
position portions of the advanced air bag provisions of FMVSS No. 208 
(S19, S21, S23, and S25) (74 FR 12925 (Mar. 25, 2009)). This extension 
was set to expire on December 15, 2010, but has been extended 
automatically by the filing of Spyker's application for an extension.
    Requested Exemption--Spyker has applied for a further extension of 
its temporary exemption. Specifically, Spyker requests that the 
exemption from the child and 5th percentile adult female driver out-of-
position portions of the advanced air bag provisions of FMVSS No. 208 
(S19, S21, S23, and S25) be extended until May 15, 2012.
    Eligibility--A manufacturer is eligible to apply for a hardship 
exemption if its total motor vehicle production in its most recent year 
of production did not exceed 10,000 vehicles, as determined by the 
NHTSA Administrator (49 U.S.C. 30113(d)). In determining whether a 
manufacturer of a vehicle meets that criterion, NHTSA considers whether 
a second vehicle manufacturer also might be deemed the manufacturer of 
that vehicle. The statutory provisions governing motor vehicle safety 
(49 U.S.C. Chapter 301) do not state that a manufacturer has 
substantial responsibility as manufacturer of a vehicle simply because 
it owns or controls a second manufacturer that assembled that vehicle. 
However, the agency considers the statutory definition of 
``manufacturer'' (49 U.S.C. 30102) to be sufficiently broad to include 
sponsors, depending on the circumstances. Thus, NHTSA has stated that a 
manufacturer may be deemed to be a sponsor and thus a manufacturer of a 
vehicle assembled by a second manufacturer if the first manufacturer 
had a substantial role in the development and manufacturing process of 
that vehicle.
    Spyker Automobielen B.V. is a small volume manufacturer of luxury 
sports cars. Since 2005, Spyker Automobielen B.V. has manufactured less 
than 100 vehicles annually worldwide, and the company projects that it 
will manufacture 103 vehicles in 2011. However, the petition stated 
that Spyker Automobielen B.V. is a wholly owned subsidiary of Spyker 
Cars NV, a publicly traded Netherlands corporation. In 2008, when 
Spyker Automobielen B.V. was granted a limited extension of its 
temporary exemption, Spyker Cars NV had no ownership interest in any 
other vehicle manufacturer nor was it under any common control with 
another automobile manufacturer.\7\ Since that time, Spyker Cars NV has 
acquired Saab Automobile AG, a large Swedish car manufacturer. Spyker 
asserts that Spyker Automobielen B.V. is financially and operationally 
independent from Saab Automobile AG and that, based on past NHTSA 
determinations regarding the issue of sponsorship, Spyker Automobielen 
B.V. remains eligible for a temporary exemption based on economic 
hardship.
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    \7\ See 74 FR 12926-27.
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    Since filing its petition, Spyker has informed the agency that 
Spyker Cars NV plans to sell Spyker Automobielen B.V. to CPP Global 
Holdings, a private holding company in the United Kingdom. Because of 
the relationship between Spyker Automobielen B.V., Spyker Cars NV, and 
Saab Automobile AG, and, in light of the plans to sell Spyker 
Automobielen B.V. to CPP Global Holdings, NHTSA will closely examine 
whether Spyker is eligible for a financial hardship exemption. NHTSA 
specifically requests comments on the issue of Spyker's eligibility.
    Economic Hardship--Spyker stated that its previously established 
financial hardship \8\ continues due to the worldwide economic 
recession, which resulted in fewer global sales than Spyker had 
predicted. Specifically, Spyker suffered a net operating loss of 
approximately 131,971,000 Euros ($171,562,300) \9\ from 2004 to 2009. 
Spyker projected a further loss in 2010 of 12,000,000 Euros 
($15,600,000). Moreover, based on 2011-2013 projections, Spyker 
estimated that if the extension is denied, Spyker will bear a loss of 
over 32,465,000 Euros ($42,204,500) during that time, as opposed to a 
loss of approximately 8,132,000 Euros ($10,571,600) if the extension is 
granted, representing a difference of 24,333,000 Euros ($31,632,900). 
Spyker also stated that the loss of sales in the U.S. that would result 
if the extension is denied could not be made up in the rest of the 
world because the U.S. is the largest and most important market for the 
vehicle. Spyker argued that such consequences demonstrate ``substantial 
economic hardship'' within the meaning of 49 U.S.C. 30113(b)(3)(B)(i).
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    \8\ See 74 FR 12925.
    \9\ All dollar values are based on an exchange rate of 1 Euro = 
$1.30.
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    Good Faith Efforts to Comply--Spyker stated that when it filed its 
original petition for exemption in 2004, its C line vehicles had no air 
bags. Spyker indicated that it started developing an ``interim'' driver 
air bag system for the C line vehicles, which went into production in 
December 2007. Additionally, Spyker stated that it began development of 
an ``interim'' passenger air bag for the C line in April 2007, which 
went into production in March 2008.
    Spyker indicated that its ``interim'' air bag system is capable of 
dual performance and meets the 35 mph belted test for both the driver 
and passenger positions. Spyker stated that this latter achievement 
brings its vehicles into compliance with paragraph S14.7 of FMVSS No. 
208 (35 mph belted test using 5th percentile adult female dummies) two 
years ahead of the September 1, 2012 deadline. Additionally, Spyker 
indicated that its C8 vehicle meets the requirements of S14.5, S15, and 
S17. However, Spyker stated that the ``interim'' air bag system still 
cannot meet all of the advanced air bag requirements.
    Spyker stated that it is continuing to work with Continental to 
develop and test its advanced air bag system and expects compliance by 
May 15, 2012. In support of its statements, Spyker submitted a detailed 
schedule for development of the advanced air bag system showing 
completion by May 2012. Spyker stated that it investigated using Saab 
facilities and equipment to develop its advanced air bag systems, but 
the company decided to continue working with Continental.
    Public Interest--The petitioner put forth several arguments in 
favor of a finding that the requested exemption is consistent with the 
public interest and would not have a significant adverse impact on 
safety. Specifically:
    1. Spyker stated that the exempted vehicles will comply with all 
FMVSSs other than the provisions that are the subject of this extension 
request.
    2. The petitioner stated that an exemption will benefit U.S. 
employment and U.S. companies because Spyker vehicles are distributed

[[Page 19182]]

by a U.S. company, Spyker of North America, and are sold and serviced 
in the U.S. through a network of 18 dealers. Spyker argued that denial 
of an extension will negatively impact these companies.
    3. Spyker argued that if the exemption is not granted, U.S. 
consumer choice would be harmed and that the agency has long maintained 
that the National Traffic and Motor Vehicle Safety Act seeks, if 
possible, to avoid limiting consumer choice.
    4. The petitioner argued that given their exotic design and high-
performance nature, the C line vehicles are not expected to be used 
extensively, nor are they expected to carry children with any 
frequency.
    NHTSA specifically invites comment on the likelihood that a child 
or infant will be a passenger in a Spyker vehicle sold in the U.S.
    5. Spyker stated that as of the submission date of its application 
for extension, approximately 60 exempted C line vehicles have been 
imported into the U.S. and there have been no reports of any air bag-
related injuries.
    6. Spyker stated that an important safety feature that the C line 
vehicles offer is enhanced occupant protection. The petitioner stated 
that occupants are positioned in a protective ``cell'' because the main 
chassis structure is built around them.
    Agency Review of Petition--Upon receiving a petition, NHTSA 
conducts an initial review of the petition with respect to whether the 
petition is complete and whether the petitioner appears to be eligible 
to apply for the requested exemption. The agency has tentatively 
concluded that the petition is complete. The agency has not made any 
judgment on the eligibility of the petitioner or the merits of the 
application, and is placing a non-confidential copy of the petition in 
the docket.

IV. Issuance of Notice of Final Action

    We are providing a 30-day comment period. After considering public 
comments and other available information, we will publish a notice of 
final action on the application in the Federal Register.

    Issued on: March 31, 2011.
Joseph S. Carra,
Acting Associate Administrator for Rulemaking.
[FR Doc. 2011-8082 Filed 4-5-11; 8:45 am]
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