HILTON HEAD, S.C. (April 2, 2002)—The Clemson Tire Conference this year could have been retitled the Clemson TREAD Act Conference.
There were presentations that analyzed the Transportation Recall Efficiency, Accountability and Documentation (TREAD) Act in its entirety. There were those that considered separate provisions of the act, such as the pending final rule on tire pressure monitoring devices. And then there were those that addressed subjects completely different from the TREAD Act, such as the pending merger of the Tire Association of North America (TANA) with the International Tire & Rubber Association (ITRA).
But at the conference held in Hilton Head March 20-22, few presentations ignored the implications of the wide-ranging legislation passed by Congress in October 2000.
“This is an industry-defining act,” said Ann Wilson, vice president of government affairs for the Rubber Manufacturers Association (RMA), in her speech on what the TREAD Act means to the future of the tire industry. “This will change the way the tire industry operates for decades to come.”
Steve Disney, TANA president, left no doubt that when his association merges with ITRA this July 1, addressing the TREAD Act will be one of its priorities—and indeed probably its most crucial one.
“This is the most immediate and complex issue facing the new association,” Mr. Disney said. TANA and ITRA are devoting major volunteer and staff time to the issue, as well as trying to work closely with the RMA and other organizations to present a united industry response, he added.
Simply speaking, the TREAD Act is a series of 12 congressionally mandated rulemakings within the National Highway Traffic Safety Administration (NHTSA) to prevent catastrophic vehicle and tire problems and expedite agency responses to product defects. Nine of the rulemakings have a direct impact on the tire industry, according to Ms. Wilson.
The TREAD Act already has greatly expanded NHTSA's powers, and will do so even more when the rulemakings are completed, according to Kenneth Weinstein, the agency's associate administrator for safety assurance.
Civil penalties against negligent vehicle, tire and parts makers already have gone from $800,000 to a maximum $15 million under the TREAD Act, Mr. Weinstein noted. Criminal penalties also have increased, although they will be invoked rarely, he said.
Mr. Weinstein admitted that the law contains some absurdities. “The TREAD Act makes it illegal to sell recalled products, and if you do, you have to report it to us,” he said. “This law was written by a lot of different people at a lot of different times.”
He concentrated most of his remarks on the act's pending “early warning” regulations, which Congress ordered in final form by June 30, 2002. “The early warning rule is designed to enable us to get information to identify potential defects as early as possible,” he said.
While the rule gives NHTSA sweeping powers to require information from manufacturers, it doesn't give the agency carte blanche to demand all their files, according to Mr. Weinstein. “We must specify how the data will be used, and we can't be unduly burdensome,” he said. “We can't make manufacturers do any reports they don't normally do—only to provide what information they have.”
For tire manufacturers, the early warning reporting requirements probably will include:
* Claims regarding serious in-juries or death;
* cAggregate statistical data on property damage;
* cConsumer satisfaction campaigns, both in the U.S. and abroad; and
* cIncidents involving fatalities and serious injuries allegedly due to defects.
Mr. Weinstein also said that “field reports” probably will be included in reporting requirements for tire makers, despite widespread industry concerns about this mandate. Both Ms. Wilson and Mr. Disney noted there is no consensus on what constitutes a “field report” in the industry, and that could leave tire makers responsible for handing over some flimsy and anecdotal information.
Attendees at the conference also expressed concern that confidential business information might be made public under the early warning rule. However, Mr. Weinstein said the procedures governing proprietary information won't change much from the way they are now.
“The manufacturer has to show the agency why confidentiality is necessary,” he said. “Talk to our counsel's office, because the information you give us probably will be made public unless you show us why it shouldn't. Production numbers probably won't be, but anything else might.”