Current Issue

MANDATORY TIRE REGISTRATION Tire aging, used tires EPA action OSHA, SBA Scrap tires Vehicle inspections Other ASA issues

Comments Email
WASHINGTON—Going into 2016, mandatory tire registration—including the content of a mandatory registration rule, and the length of time it may take for the National Highway Traffic Safety Administration (NHTSA) to promulgate it—is the subject on the mind of almost everyone in the tire industry.

However, it will not be the only issue in the coming year. In Tire Business' annual legislative roundup, executives of various tire and automotive trade associations cited various legislative, regulatory and industry initiatives that will affect their members—for good or ill—in 2016.

A provision requiring independent tire dealers to register all the tires they sell at the point of sale, and to transmit that information electronically to tire manufacturers, became law in December as part of a larger, five-year surface transportation reauthorization bill—the Fixing America's Surface Transportation or FAST Act.

The mandatory registration provision was part of a group of strategic initiatives advanced by the Rubber Manufacturers Association (RMA). Its recommendations—which also were part of the final legislation—included one provision to establish fuel-economy and wet-traction minimum standards for tires, and another for NHTSA to post a user-friendly tire safety recall lookup engine on its website, navigable by tire identification number (TIN).

The RMA was delighted by passage of the surface transportation bill in general and of its strategic initiatives in particular, according to Charles A. Cannon, outgoing RMA president and CEO.

“We've waited a long time for a multi-year highway bill,” Mr. Cannon told Tire Business. “Its passage represented a coming together of interests. Unfortunately, it was a unique opportunity, but an opportunity nonetheless.

“We agree with the National Transportation Safety Board (NTSB) that the recall system is broken and needs fixing,” Mr. Cannon said.

In October 2015, as an outcome of a two-day hearing held the previous December, the NTSB issued a report making 11 recommendations to improve tire registration and recalls.

Mr. Cannon noted that there is no timetable for NHTSA to complete action on the RMA's provisions.

“We look forward to NHTSA taking the lead in reforming these regulations, but we hope they do so with a sense of urgency,” he said.

The Tire Industry Association (TIA) opposed mandatory registration as unfair to independent tire dealers, according to TIA Executive Vice President Roy Littlefield. Even more, however, TIA is concerned that the issue is now in the hands of government regulators, rather than being handled internally by stakeholders or debated in Congress.

“One concern we have is that for 10 years we have talked about the need for the industry to speak in one voice and be profit-driven in all things,” Mr. Littlefield said.

“I have great concerns how this will play out—not just for us, but for manufacturers,” he said. “We may see we've bitten off more than we can chew.

“There was never a vote on any of this, never a discussion or vote,” Mr. Littlefield continued. “Now we've turned it over completely to bureaucrats.”

Turning over customer lists to tire makers is especially worrisome for independent dealers, according to Mr. Littlefield. Not long ago the European Union established similar requirements for dealers to transmit registration information to manufacturers, and Mr. Littlefield and other Americans heard about the results at the recent conference in Bologna, Italy, of BIPAVER, the European retreading association.

“The first year of the European regulations, online sales of tires rose over 20 percent,” Mr. Littlefield noted. “It was killing the European dealers.”

TIA managed to get House-Senate conferees for the surface transportation bill to include a provision for NHTSA to perform a study on the feasibility of including readable electronic devices on tires that would contain the TIN and all relevant registration information. However, the conferees rejected TIA's proposal to defer rulemaking on mandatory registration until the study was completed.

“We will make a concerted effort to meet with safety groups to call for pushing forward on the study,” Mr. Littlefield said.

Mr. Cannon said the RMA favors analysis of electronic information on tires, but added: “We are pleased to see it's not a condition of moving forward with reform of tire registration.”

The RMA expects to see state legislation placing safety restrictions on the sale of used tires in 2016, despite the failure of used tire bills in several states in 2015, according to Dan Zielinski, RMA senior vice president, public affairs.

South Carolina is the most likely state to consider a used tire bill in the coming year, Mr. Zielinski said.

“This year we came down literally to the final minutes in the South Carolina Senate, but we ran out of time. Our priority is to get a bill passed and signed into law.”

Among the recommendations in the NTSB report were two related to tire aging.

One recommendation proposed implementing plans to promote a tire-aging test protocol if tire safety and tire pressure monitoring system (TPMS) data show tire-aging risk should be mitigated. The other recommended developing a consensus document on tire aging with tire makers, vehicle makers and safety advocates that includes best practices on how to mitigate tire aging.

Nevertheless, Mr. Zielinski said, the RMA doesn't expect tire-aging legislation in the states to be an issue in 2016.

“In the past six or seven years, the number of tire-aging bills has really declined,” he said. “This year there was only one bill introduced, in New Jersey, and it was not considered.”

Mr. Zielinski attributed the decline partly to tires' becoming more robust under strengthened federal safety standards, and partly to the growing realization that chronological age is not the determining factor in a tire's roadworthiness.

Ironically, tire dealers are coming to feel that some sort of government action on tire aging may be to their benefit, according to Mr. Littlefield.

“Historically, we stood with the RMA on tire aging,” he said. But more and more tire dealers are facing lawsuits for selling or servicing tires that exceed the age recommendations of tire or auto makers.

“There is no other product in America for which the retailer is held responsible.”

Both the RMA and the Automotive Service Association (ASA) said that actions by the U.S. Environmental Protection Agency (EPA) could have significant impact on their members.

Under the EPA's Greenhouse Gas Plan established by the Obama administration, certain biomass fuels can get greenhouse gas credits, according to Mr. Cannon. Because natural rubber is biomass, tire-derived fuel (TDF) potentially could bring greenhouse gas credits to plants that use it, he said.

“If the EPA defines TDF as a biomass fuel, power plants might take a closer look at using TDF,” Mr. Cannon said.

Meanwhile, a long-anticipated bill reforming the Toxic Substances Control Act (TSCA) is being held up in Congress, largely because of two senators who have placed a hold on the bill for reasons unrelated to TSCA itself, Mr. Zielinski said.

The RMA's Tire Materials Committee is responding to the EPA's need for data, according to Mr. Cannon. “We have a reasonable working relationship with the EPA, and we can provide data regulators can make use of.”

For the ASA, the big EPA-related issue is how new ozone limits—moving to 70 parts per billion from the current 75—will play out as State Implementation Plans are issued, according to Robert L. Redding, ASA Washington representative. This goes straight to the issue of the need for vehicle emissions testing and whether current testing programs go far enough, he said.

For TIA, two workplace-related issues will continue to be of concern in 2016, according to Mr. Littlefield.

One is increased spot inspections of independent repair shops and tire dealerships by the Occupational Safety and Health Administration (OSHA).

“They've targeted the auto aftermarket, and there have been fines ranging from $20,000 to $40,000 for minor infractions,” he said.

An even greater worry is the Small Business Administration's proposal to redefine managers and assistant managers in small businesses as hourly workers for the purpose of overtime pay, according to Mr. Littlefield.

Most tire dealerships can't afford overtime pay for these employees, he said, and may be forced to cut sick leave and other benefits as a consequence.

“They think a small business has a back room filled with money,” he said. “A tire dealer has a finite amount of money he can spend.”

Most tire dealers already pay well beyond the minimum wage, according to Roy Littlefield IV, TIA government affairs manager.

“They make an honest effort to provide for their employees over and beyond what's needed,” he said. “These guys have really tried hard.”

New England has ongoing scrap tire problems caused by the closure in late 2013 of Oxford Energy Corp. plant that used TDF, according to Messrs. Cannon and Zielinski

Mr. Zielinski said it apparently became uneconomical to operate the facility. Given that it consumed 7-9 million tires annually, he told Tire Business there was a concern that New England would see a tire problem, but so far, the markets appear to have largely adjusted.

The situation helped motivate the Connecticut legislature to consider two bills that would have introduced a tire stewardship plan in Connecticut—however, the RMA successfully opposed both bills.

Some pulp and paper mills in Maine are increasing their use of TDF, they said, but diversification of scrap tire markets needs to be the goal in New England. A scrap-to-market conference in Albany, N.Y., in November 2015 helped to put New England regulators in touch with recycling industry professionals to advance the diversification effort, Mr. Cannon said.

In an especially promising move, California is poised to provide grants for state agencies and municipalities to use rubber-modified asphalt in highway and road projects, according to Mr. Zielinski.

Potentially, California could use 24 million scrap tires annually for highway projects, out of the 40 million it generates, he said.

On the other hand, many states remain hostile to rubber-modified asphalt, Mr. Zielinski said. Too many state highway administrators remember the rubberized asphalt mandates of the Intermodal Surface Transportation Efficiency Act (ISTEA) of 1991, which proved to be so unworkable and unpopular that Congress eventually repealed them.

“State highway departments have long memories,” he said. “But the technology of rubber-modified asphalt has improved demonstrably since then, and now in some cases rubber-modified asphalt is cheaper than conventional asphalt.”

For the ASA, the importance of periodic state vehicle safety inspections—and the dwindling number of states that do them—remains a major issue, according to Mr. Redding.

“Only 16 states still have inspection programs, and we're hemorrhaging more every year,” he said. Mississippi's program was the latest to end, he said, though that program was rudimentary.

States such as Missouri, Pennsylvania and Texas continue to have strong inspection programs in place, according to Mr. Redding, but others, such as Florida and Connecticut, are considering repealing their programs.

To bolster interest in inspection programs, the ASA established an annual Vehicle Safety Inspection & Maintenance Forum. The second annual forum was held in St. Louis Dec. 2, hosted by Hunter Engineering Co. and co-sponsored by the ASA, ASA-Midwest and the Missouri Alliance of Automotive Service Providers.

Presenters at the forum included officials from all the above organizations, as well as the Missouri State Highway Patrol and the Government Accountability Office (GAO), Mr. Redding said.

The GAO's recent report on vehicle inspection and maintenance programs was “a mixed bag” for the auto service industry, Mr. Redding said. A 2010 study by the Pennsylvania Department of Transportation, he added, was much more comprehensive and supportive.

A large part of the problem is that NHTSA provides only generic guidelines in support of vehicle inspection programs, without any enforcement or specific regulations, according to Mr. Redding.

“NHTSA must be more engaged,” he said. “We have tried very hard with each administration to make our concerns known. They saw our side, but didn't have enough interest to compare state programs.”

A bill before the Michigan legislature that would forbid insurers from specifying parts suppliers to repair shops as a prerequisite of paying for repair work is of major interest to the ASA, Mr. Redding said.

“The issue is parts sourcing. If I deal with a local guy, and I buy garbage from him, I'll call him and he'll make it right.

“But insurance companies want me to go from a guy a mile away to a supplier in Nevada or Australia,” he said. “Then I have to negotiate for shipping, and the parts I get may not fit or even work.”

Telematics and cybersecurity also remain the most important issues of all for the ASA, he said. “We want to make sure that in all the policy debates, the needs of vehicle owners and repair shops are considered. We want to know what our folks are getting and not getting.”

The ASA already has sent out invitations to potential speakers at the Second Annual Telematics and Technology Forum, to be held during the International Autobody Congress & Exposition/Congress of Automotive Repair & Service (NACE/CARS) in Anaheim, Calif., in August, he said.

To reach this reporter: mmoore@ crain.com

More Polls>

TB Reader Poll

Previous | Published February 1, 2019

What issue concerns you most heading into 2019?

The threat of more tariffs.
27% (27 votes)
The new Congress in Washington.
35% (35 votes)
Price fluctuations for the products we sell.
10% (10 votes)
More disruptions across the industry.
29% (29 votes)
Total votes: 101
More Polls »