The election results of 2004-with President George W. Bush winning a second term and the Republicans expanding their majority in both houses of Congress-augured good things for tire dealers and their allies concerning their legislative agendas in 2005.
Because of the election and the continuing war in Iraq, however, Congress did little that affected the auto aftermarket directly. The chief regulatory news, meanwhile, was pretty much tied to the TREAD Act, much as in the past several years.
The TREAD Act
Passed by Congress in October 2000, the Transportation Recall Efficiency, Accountability and Documentation (TREAD) Act still made headlines in 2004.
The National Highway Traffic Safety Administration (NHTSA) seemed unable to please any of the stakeholders in any of the TREAD Act-related rulemakings it issued.
One example was the ``early warning'' rule, which requires all auto, tire and parts manufacturers to send to NHTSA's database any information that might indicate the possibility of a product defect. In the original version, the agency granted confidentiality to production, warranty and consumer complaint data. In April, it extended that protection to common green tire lists, which cover basic tire constructions for various tire models and brands.
This ruling angered consumer group Public Citizen, which sued NHTSA in federal court to force release of all early warning data. It also irked the Rubber Manufacturers Association (RMA), which filed a cross-claim in the Public Citizen lawsuit to make all early warning data confidential.
In September, NHTSA issued a second final rule on tire pressure monitoring systems after a federal court overturned the first version. The new rule, as the court demanded, did not show favoritism to systems that measure tire pressures indirectly. However, the RMA objected to the regulation because it allows tire pressures to fall 25 percent below the vehicle manufacturer's recommendation before motorists were warned.
The association, along with the Tire Industry Association (TIA) and the American Automobile Association, renewed its call for a minimum reserve pressure requirement to counterbalance the 25-percent threshold.
An agency official said in May NHTSA planned to propose a federal tire aging test by June 2005. This wasn't enough, however, for Safety Research & Strategies Inc., a Massachusetts-based group that petitioned NHTSA in November to establish expiration dates for tires.
This proposal was similar to one introduced but then dropped by Sen. Mike DeWine, R-Ohio, after opposition from TIA and the RMA. Opponents of the measure said the variables involved made such a rulemaking speculative at best, while the manufacture date molded on every tire also made it unnecessary.
Meanwhile, specialty tire manufacturers have waited for more than a year for NHTSA to answer their petition for an exemption from tire testing rules. Without this exemption, they said, many specialty tires will be forced from the market.
A long wait in Congress
When TIA and other aftermarket associations host the Aftermarket Legislative Summit in March, they will find themselves discussing with their elected officials the same issues they lobbied for at the last legislative summit in February 2003. That agenda includes:
* Passage of the Right to Repair Act;
* Enactment of a mandate to establish Association Health Plans; and
* Legislation to limit liability under asbestos-related claims.
The Motor Vehicle Owners' Right to Repair Act would mandate fines of up to $10,000 for each violation of requirements for auto makers to provide independent repair shops with the same service, repair and diagnostic information they provide to their dealers.
Despite 118 co-sponsors in the House and 11 in the Senate, the bill never moved to even a subcommittee vote during the 108th Congress. For every supporter of the Right to Repair Act in Congress, there is a supporter of the September 2002 voluntary agreement the Automotive Service Association (ASA) made with most of the world's major auto makers for them to provide online repair and diagnostic information in a readily accessible, affordable format.
A Sept. 22 hearing before a House Energy and Commerce subcommittee found the two sides further apart than ever.
Testimony from the ASA, the Alliance of Automobile Manufacturers and the National Automotive Service Task Force gave glowing reviews of the agreement and how well it was working. Supporters of the Right to Repair Act insisted the auto makers' Web sites were unduly expensive, difficult to navigate and liable to cancellation at a moment's notice.
Rep. Edolphus Towns, D-N.Y., has said he will reintroduce the Right to Repair Act in the 109th Congress.
An even bigger heartbreaker for the aftermarket was the Small Business Health Fairness Act of 2003. This bill would have allowed professional and trade associations to pool their members across state lines to create Association Health Plans (AHPs), under which small businesses could join together to negotiate for health insurance policies.
The Small Business Health Fairness Act passed the House back in June 2003 but never moved in the Senate. President Bush is a supporter of AHPs, however, so supporters hope that his support-coupled with a stronger GOP majority in Congress-will mean passage in the 109th Congress.
Despite sponsorship by Sen. Orrin Hatch, R-Utah, the Fairness in Asbestos Injury Resolution (FAIR) Act went nowhere in the 108th Congress. The bill would have established a five-judge federal court of asbestos claims to consider asbestos cases on a no-fault basis. The top award would have been $750,000, and that would have gone only to claimants with mesothelioma, or cancer of the lining of the chest cavity.
Several aftermarket brake manufacturers have gone bankrupt because of asbestos litigation, which is why the aftermarket is a foursquare supporter of the FAIR Act.
One tire-related bill that did pass Congress was an amendment to the Bush administration's jobs creation bill, simplifying the way federal excise tax (FET) is calculated on truck tires.
Instead of basing FET calculations on weight, as has been the standard since 1982, the new law-which goes into effect Jan. 1-sets the tax at 9.45 cents for each 10 pounds of load capacity above 3,500 pounds. For bias-ply and ``super single'' tires, the tax rate is halved to 4.725 cents.
Michelin North America Inc., which lobbied for the change, said it will make the FET system simpler and fairer than before. But TIA expressed reservations that taxing super-single tires at the same rate as bias-ply tires might cause a revenue shortfall.