Reports, Forms, and Recordkeeping Requirements |
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Jeffrey Giuseppe
National Highway Traffic Safety Administration
22 December 2017
[Federal Register Volume 82, Number 245 (Friday, December 22, 2017)]
[Notices]
[Pages 60789-60795]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2017-27635]
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DEPARTMENT OF TRANSPORTATION
National Highway Traffic Safety Administration
[U.S. DOT Docket Number NHTSA-2016-0065]
Reports, Forms, and Recordkeeping Requirements
AGENCY: National Highway Traffic Safety Administration (NHTSA), U.S.
Department of Transportation.
ACTION: Notice.
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SUMMARY: In compliance with the Paperwork Reduction Act of 1995, this
notice announces that the Information Collection Request (ICR)
abstracted below has been forwarded to the Office of Management and
Budget (OMB) for review and comment. The ICR describes the nature of
the information collections and their expected burden. The Federal
Register Notice with a 60-day comment period was published on October
2, 2017.
DATES: Comments must be submitted to OMB on or before January 22, 2018.
ADDRESSES: Send comments to the Office of Information and Regulatory
Affairs, OMB, 725 17th Street NW, Washington, DC 20503.
FOR FURTHER INFORMATION CONTACT: Stephen Hench, Office of Chief Counsel
(NCC-0100), Room W41-229, NHTSA, 1200 New Jersey Avenue SE, Washington,
DC 20590. Telephone: 202.366.2992.
SUPPLEMENTARY INFORMATION: Under the Paperwork Reduction Act of 1995,
before an agency submits a proposed collection of information to OMB
for approval, it must first publish a document in the Federal Register
providing a 60-day comment period and otherwise consult with members of
the public and affected agencies concerning each proposed collection of
information. The OMB has promulgated regulations describing what must
be included in such a document. Under OMB's regulation, see 5 CFR
1320.8(d), an agency must ask for public comment on the following:
(i) Whether the proposed collection of information is necessary for
the proper performance of the functions of the agency, including
whether the information will have practical utility;
(ii) the accuracy of the agency's estimate of the burden of the
proposed collection of information, including the validity of the
methodology and assumptions used;
(iii) how to enhance the quality, utility, and clarity of the
information to be collected; and
(iv) how to minimize the burden of the collection of information on
those who are to respond, including the use of appropriate automated,
electronic, mechanical, or other technological collection techniques or
other forms of information technology, e.g., permitting electronic
submission of responses.
In compliance with these requirements, NHTSA asks for public
comments on the following collection of information:
Title: Defect and Noncompliance Reporting and Notification.
Type of Request: Renewal of a currently approved information
collection.
OMB Control Number: 2127-0004.
Affected Public: Businesses or individuals.
Abstract: The 60-day notice for this information collection
received four (4) comments. Two of these comments were anonymously
submitted and discuss issues unrelated to this information collection
(a SEC rule, and global temperature changes). One of these comments,
submitted by Gary and Sherry Buckingham, queries: ``Where and when will
we know to get our air bags from Takata fixed?'' Vehicle manufacturers
are required to mail letters to vehicle owners notifying them
[[Page 60790]]
when a remedy is available and how to obtain the free remedy.
Additionally, individuals may consult NHTSA's Takata Recall Spotlight
website (https://www.nhtsa.gov/recall-spotlight/takata-air-bags), and
utilize NHTSA's VIN Look-Up Tool (available at https://www.nhtsa.gov/recalls), to obtain information including how the recalls may affect
their specific vehicle(s). The final comment received was submitted by
the Alliance of Automobile Manufacturers (Alliance) and the Association
of Global Automakers (Global Automakers) (hereinafter collectively
``Alliance & Global''). Alliance & Global offered comments on estimates
related to safety recall reporting and owner notification obligations,
as well as estimates related to manufacturer obligations under the
Takata Coordinated Remedy Program. A summary of these comments is below
with the corresponding burden estimates, along with the agency's
response.
This collection covers the information collection requirements
found within various statutory sections in the Motor Vehicle Safety Act
of 1966 (Act), 49 U.S.C. 30101, et seq., that address and require
manufacturer notifications to NHTSA of safety-related defects and
failures to comply with Federal Motor Vehicle Safety Standards (FMVSS)
in motor vehicles and motor vehicle equipment, as well as the provision
of particular information related to the ensuing owner and dealers
notifications and free remedy campaigns that follow those
notifications. The sections of the Act imposing these requirements
include 49 U.S.C. 30118, 30119, 30120, and 30166. Many of these
requirements are implemented through, and addressed with more
specificity in, 49 CFR part 573, Defect and Noncompliance
Responsibility and Reports (Part 573) and 49 CFR 577, Defect and
Noncompliance Notification (Part 577).
Pursuant to the Act, motor vehicle and motor vehicle equipment
manufacturers are obligated to notify, and then provide various
information and documents to, NHTSA in the event a safety defect or
noncompliance with Federal Motor Vehicle Safety Standards (FMVSS) is
identified in products they manufactured. See 49 U.S.C. 30118(b) and 49
CFR 573.6. Manufacturers are further required to notify owners,
purchasers, dealers, and distributors about the safety defect or
noncompliance. See 49 U.S.C. 30118(b), 30120(a); 49 CFR 577.7, 577.13.
Manufacturers are required to provide to NHTSA copies of communications
pertaining to recall campaigns that they issue to owners, purchasers,
dealers, and distributors. See 49 U.S.C. 30166(f); 49 CFR 573.6(c)(10).
Manufacturers are also required to file with NHTSA a plan
explaining how they intend to reimburse owners and purchasers who paid
to have their products remedied before being notified of the safety
defect or noncompliance, and explain that plan in the notifications
they issue to owners and purchasers about the safety defect or
noncompliance. See 49 U.S.C. 30120(d) and 49 CFR 573.13. Manufacturers
are further required to keep lists of the respective owners,
purchasers, dealers, distributors, lessors, and lessees of the products
determined to be defective or noncompliant and involved in a recall
campaign, and are required to provide NHTSA with a minimum of six
quarterly reports reporting on the progress of their recall campaigns.
See 49 CFR 573.8 and 573.7, respectively.
In addition, in an enforcement action, certain manufacturers may be
required by administrative order to conduct supplemental recall
communications utilizing non-traditional means (e.g., text messaging,
social media) crucial to achieving completion of a unique, large-scale
recall. Presently, NHTSA is overseeing manufacturer recalls of
unprecedented complexity involving Takata air bag inflators, where it
has required such supplemental owner communications.\1\
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\1\ See ``Notice of Coordinated Remedy Program Proceeding for
the Replacement of Certain Takata Air Bag Inflator,'' available at
https://www.regulations.gov/docket?D=NHTSA-2015-0055.
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The Act and Part 573 also contain numerous information collection
requirements specific to tire recall and remedy campaigns. These
requirements relate to the proper disposal of recalled tires, including
a requirement that the manufacturer conducting the tire recall submit a
plan and provide specific instructions to certain persons (such as
dealers and distributors) addressing that disposal, and a requirement
that those persons report back to the manufacturer certain deviations
from the plan. See 49 U.S.C. 30120(d) and 49 CFR 573.6(c)(9). The
regulations also require that manufacturers report to NHTSA intentional
and knowing sales or leases of defective or noncompliant tires.
49 U.S.C. 30166(n) and its implementing regulation found at 49 CFR
573.10 mandate that anyone who knowingly and willfully sells or leases
for use on a motor vehicle a defective tire or a tire that is not
compliant with FMVSS, and with actual knowledge that the tire
manufacturer has notified its dealers of the defect or noncompliance as
required under the Act, is required to report that sale or lease to
NHTSA no more than five working days after the person to whom the tire
was sold or leased takes possession of it.
Estimated Burden: The existing information collection associated
with 49 CFR part 573 and portions of 49 CFR part 577 currently has an
estimated annual burden of 36,070 hours associated with an estimated
275 respondents per year.\2\ Our prior estimates of the burden hours
and cost associated with the requirements currently covered by this
information collection require adjustment as follows.
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\2\ See 81 FR 70269 (October 11, 2016).
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Based on current information, we estimate 274 distinct
manufacturers filing an average of 963 part 573 Safety Recall Reports
each year. This is a change from our previous estimate of 854 part 573
Safety Recall Reports filed by 275 manufacturers each year. In
addition, with reference to the metric associated with NHTSA's VIN
Look-up Tool regulation, see 49 CFR 573.15, we estimate it takes the 17
major passenger-vehicle manufacturers (that each produce more than
25,000 vehicles annually) more burden hours to complete these Reports
to NHTSA. See 81 FR 70270 (October 11, 2016). Between 2014 and 2016,
the major passenger-vehicle manufacturers collectively conducted an
average of 299 recalls annually.
We estimate that maintenance of the required owner, purchaser,
dealer, and distributor lists requires 8 hours a year per manufacturer.
Alliance & Global commented that it was unclear what this task
involves, but that ``[i]f it includes obtaining the data and curating
it for accuracy on a weekly or biweekly basis, this estimate is far too
low.'' Without more information, it is difficult for NHTSA to revise
its estimate in light of this comment. However, we note that this list
maintenance involves tasks necessary to ensure a company has accurate
records (e.g., names and addresses) of owners, purchasers, dealers, and
distributors for use in discharging recall-notification obligations
under 49 CFR parts 573 and 577, and that the amount of data and nature
of information curation will vary from manufacturer to manufacturer.
NHTSA continues to estimate at this time that maintenance of the
required owner, purchaser, dealer, and distributors lists requires 8
hours a year per manufacturer.
We estimated that it takes a major passenger-vehicle manufacturer
20 burden hours, on average, to prepare and file their Part 573
Reports. In a
[[Page 60791]]
previous agency response to prior comments from Nissan North America,
Inc. (Nissan), we acknowledged that major passenger-vehicle
manufacturers may require more burden hours to file these reports, and
agreed with Nissan's estimate of 20 burden hours for this requirement.
See 81 FR 70270 (October 11, 2016). Alliance & Global here provide
further input on this metric as it bears on major passenger-vehicle
manufacturers, commenting that as a ``best fit'' of information
collected from its member companies, its members spend 40 hours
completing each Part 573 Recall Report. NHTSA repeats its observations
that most manufacturers who conduct safety recalls are not major
passenger-vehicle manufacturers, and that most other manufacturers
include very few products in the average safety recall. NHTSA further
observes that many members of the Alliance & Global are major
passenger-vehicle manufacturers, and that therefore its comments are
more representative of, and applicable to the burdens for, such
manufacturers. NHTSA thanks the Alliance & Global for its comment, and
now estimates that the major passenger-vehicle manufacturers will
require 40 burden hours to prepare and file their Part 573 Recall
Reports. NHTSA continues to estimate it takes all other manufacturers 4
hours to prepare and file their Part 573 Recall Reports.
Accordingly, we estimate the annual burden hours related to the
reporting to NHTSA of a safety defect or noncompliance for the 17 major
passenger vehicle-manufacturers to be 11,960 hours annually (299
notices x 40 hours/report), and that all other manufacturers require a
total of 2,656 hours annually (664 notices x 4 hours/report) to file
their notices. Accordingly, the estimated annual burden hours related
to the reporting to NHTSA of a safety defect or noncompliance is 16,808
hours (11,960 hours + 2,656 hours) + (274 MFRs x 8 hours to maintain
purchaser lists).\3\
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\3\ For more information about how we derived these and certain
other estimates please see 81 FR 70269 (October 11, 2016).
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We estimate that an additional 40 hours will be needed to account
for major passenger-vehicle manufacturers adding details to Part 573
Safety Recall Reports relating to the intended schedule for notifying
its dealers and distributors, and tailoring its notifications to
dealers and distributors in accordance with the requirements of 49 CFR
577.13. For all other manufacturers, an additional 2 hours will be
needed to account for this obligation. This burden is estimated at
13,288 hours annually (664 notices x 2 hours/notification) + (299
notices x 40 hours/notification).
49 U.S.C. 30166(f) requires manufacturers to provide the Agency
copies of all communications regarding defects and noncompliances sent
to owners, purchasers, and dealerships. Manufacturers must index these
communications by the year, make, and model of the vehicle as well as
provide a concise summary of the subject of the communication. We
estimated this burden requires 30 minutes for each vehicle recall.
Alliance & Global commented that as a ``best fit'' of information
collected from its member companies, its members spend 3 hours per
recall on this requirement. NHTSA does acknowledge that its previous
estimate could have been low, particularly in the case of larger
recalls involving a diverse group of vehicle years, makes, and models,
which Alliance & Global members may face more frequently than smaller
manufacturers. Accordingly, NHTSA now estimates this burden to be 3
hours for the 17 major passenger-vehicle manufacturers. This totals an
estimated 1,229 hours annually (299 recalls x 3 hours for the 17 major
passenger-vehicle manufacturers) + (664 recalls x .5 for all other
manufacturers).
In the event a manufacturer supplied the defective or noncompliant
product to independent dealers through independent distributors, that
manufacturer is required to include in its notifications to those
distributors an instruction that the distributors are to then provide
copies of the manufacturer's notification of the defect or
noncompliance to all known distributors or retail outlets further down
the distribution chain within five working days. See 49 CFR
577.7(c)(2)(iv). As a practical matter, this requirement would only
apply to equipment manufacturers since vehicle manufacturers generally
sell and lease vehicles through a dealer network, and not through
independent distributors. We believe our previous estimate of 95
equipment recalls per year needs to be adjusted to 87 equipment recalls
per year to better reflect recent data. Although distributors are not
required to follow that instruction, we expect that they will, and have
estimated the burden associated with these notifications (identifying
retail outlets, making copies of the manufacturer's notice, and
mailing) to be 5 hours per recall campaign. Assuming an average of 3
distributors per equipment item, (which is a liberal estimate given
that many equipment manufacturers do not use independent distributors)
the total number of burden hours associated with this third-party
notification burden is approximately 1,305 hours per year (87 recalls x
3 distributors x 5 hours).
As for the burden linked with a manufacturer's preparation of and
notification concerning its reimbursement for pre-notification
remedies, we estimated that the preparation of a reimbursement plan
takes approximately 4 hours annually, an additional .5 hours is spent
tailoring each plan to particular defect and noncompliance
notifications to NHTSA and adding tailored language about the plan to a
particular safety recall's owner notification letters, and an
additional 12 hours annually is spent disseminating plan information.
Alliance & Global commented that as a ``best fit'' of information
collected from its member companies, its members spend 1.5 hours,
instead of .5 hours, tailoring reimbursement plans for a given recall.
NHTSA appreciates Alliance & Global's comment, and acknowledges
that its previous estimate could have been low, particularly in the
case of larger recalls involving a diverse group of vehicle years,
makes, and models, which Alliance & Global members may face more
frequently than smaller manufacturers. NHTSA now estimates this burden
to be 1 hour for the 17 major passenger-vehicle manufacturers.
Incorporating this revision, for this burden NHTSA estimates a total
5,165 annual hours (274 MFRs x 4 hours to prepare plan) + [(299 recalls
x 1.5 hours tailoring plan for each recall for 17 major passenger-
vehicle manufacturers) + (664 recalls x .5 tailoring plan for all other
manufacturers)] + (274 MFRs x 12 hours to disseminate plan
information)).
The Safety Act and 49 CFR part 573 also contain numerous
information collection requirements specific to tire recall and remedy
campaigns, as well as a statutory and regulatory reporting requirement
that anyone who knowingly and intentionally sells or leases a defective
or noncompliant tire notify NHTSA of that activity.
Manufacturers are required to include specific information related
to tire disposal in the notifications they provide NHTSA concerning
identification of a safety defect or noncompliance with FMVSS in their
tires, as well as in the notifications they issue to their dealers or
other tire outlets participating in the recall campaign. See 49 CFR
573.6(c)(9). We estimate that the agency administers 12 tire recalls
each year, on average. We estimate that the inclusion of this
additional information will require an additional two hours of effort
beyond the subtotal above associated with non-tire recall
[[Page 60792]]
campaigns. This additional effort consists of one hour for the NHTSA
notification and one hour for the dealer notification for a total of 24
burden hours (12 tire recalls a year x 2 hours per recall).
Manufacturer-owned or controlled dealers are required to notify the
manufacturer and provide certain information should they deviate from
the manufacturer's disposal plan. Consistent with our previous
analysis, we ascribe zero burden hours to this requirement since to
date no such reports have been provided and our original expectation
that dealers would comply with manufacturers' plans has proven true.
Accordingly, we estimate 24 burden hours a year will be spent
complying with the tire recall campaign requirements found in 49 CFR
573.6(c)(9).
The agency recently received one report under 49 U.S.C. 30166(n)
and its implementing regulation at 49 CFR 573.10 of a defective or
noncompliant tire being intentionally sold or leased, so our previous
estimate of zero burden hours for this regulatory requirement is being
revised. The agency estimates 1 burden hour annually will be spent
preparing and submitting such reports.
We continue to believe nine vehicle manufacturers, who did not
operate VIN-based recalls lookup systems prior to August 2013, incur
certain recurring burdens on an annual basis. We continue to estimate
that 100 burden hours will be spent on system and database
administrator support. These 100 burden hours include: Backup data
management and monitoring; database management, updates, and log
management; and data transfer, archiving, quality assurance, and
cleanup procedures. We estimate another 100 burden hours will be
incurred on web/application developer support. These burdens include:
Operating system and security patch management; application/web server
management; and application server system and log files management. We
estimate these burdens will total 1,800 hours each year (9 MFRs x 200
hours). We estimate the recurring costs of these burden hours will be
$30,000 per manufacturer.\4\ We estimate that the total cost to the
industry from these recurring expenses will total $270,000, on an
annual basis (9 MFRs x $30,000).
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\4\ $8,000 (for data center hosting for the physical server) +
$12,000 (for system and database administrator support) + $10,000
(for web/application developer support) = $30,000.
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Changes to 49 CFR part 573 in 2013 required 27 manufacturers to
update each recalled vehicle's repair status no less than every 7 days,
for 15 years from the date the VIN is known to be included in the
recall. This ongoing requirement to update the status of a VIN for 15
years continues to add a recurring burden on top of the one-time burden
to implement and operate these online search tools. We estimate that 8
affected motorcycle manufacturers will make recalled VINs available for
an average of 2 recalls each year and 19 affected passenger-vehicle
manufacturers will make recalled VINs available for an average of 8
recalls each year. We believe it will take no more than 1 hour, and
potentially much less with automated systems, to update the VIN status
of vehicles that have been remedied under the manufacturer's remedy
program. We estimate this will require 8,736 burden hours per year (1
hour x 2 recalls x 52 weeks x 8 MFRs + 1 hour x 8 recalls x 52 weeks x
19 MFRs) to support the requirement to update the recalls completion
status of each VIN in a recall at least weekly for 15 years.
As the number of Part 573 Recall Reports has increased in recent
years, so has the number of quarterly reports that track the completion
of safety recalls. Our previous estimate of 3,800 quarterly reports
received annually is now revised upwards to 4,498 quarter reports
received annually. We estimated it takes manufacturers 10 minutes to
gather the pertinent information for each quarterly report, and 4
additional hours annually for the 17 major passenger-vehicle
manufacturers to electronically submit their reports. Alliance & Global
commented that as a ``best fit'' of information collected from its
member companies, its members spend 1 hour (instead of 10 minutes)
gathering pertinent information for each quarterly report, and 10 hours
annually (instead of 4 hours) in additional time related to submitting
their reports.
As NHTSA previously observed in revising its estimate--in light of
comments from Nissan--the gathering of pertinent information is likely
automated through electronic reporting. See 81 FR 70270 (October 11,
2016) (adopting Nissan's estimate of 10 minutes). However, we now
recognize that the degree of automation of these processes may vary
across manufacturers. Accordingly, we adopt Alliance & Global's
estimate of 1 hour.
NHTSA's estimate of 4 additional related hours annually for the 17
major passenger-vehicle manufacturers to electronically submit their
reports was based on an estimate of time, in response to a comment from
Nissan, to electronically submit reports each quarter (for up to 30
recalls in each given quarter). See 81 FR 70270 (October 11, 2016).
NHTSA recognizes that major passenger-vehicle manufacturers may have
more than 30 recalls on which to report for a given quarter, and will
also include an additional six (6) hours for the 17 major passenger-
vehicle manufacturers, for a total of ten (10) burden hours. We
therefore now estimate that the quarterly reporting burden pursuant to
Part 573 totals 4,668 hours [(4,498 quarterly reports x 1 hour/report)
+ (17 MFRs x 10 additional hours for electronic submission)].
We continue to estimate a small burden of 2 hours annually in order
to set up a manufacturer's online recalls portal account with the
pertinent contact information and maintaining/updating their account
information as needed. We estimate this will require a total of 548
hours annually (2 hours x 274 MFRs).
We estimated that 20 percent of Part 573 reports will involve a
change or addition regarding recall components, and that at one hour
per amended report, this totals 193 burden hours per year. Alliance &
Global implicitly commented on the 20 percent figure, assuming in its
proposed burden estimate that all recalls involve a change or addition
regarding recall components. However, not all recalls require such a
change, and Alliance & Global do not offer an alternative figure and/or
further explanation of their estimate. Accordingly, NHTSA will retain
the 20-percent figure in its estimate. Alliance & Global did, however,
comment that this task generally takes its members at least two (2)
hours per recall, and ``more in complex matters,'' and NHTSA
acknowledges that its previous estimate could have been low--
particularly in the case of larger recalls involving a diverse group of
vehicle years, makes, and models. NHTSA is adding another hour to this
burden estimate for the 17 major passenger-vehicle manufacturers,
recognizing that many recalls are conducted by smaller manufacturers
but, at the same time, the burden may be more than 2 hours for complex
recalls that Alliance & Global members may more often face. NHTSA now
estimates the burden associated with a change or addition regarding
recall components at 253 burden hours per year (299 recalls for 17
major passenger-vehicle manufacturers x .20 = 60 recalls; 60 x 2 = 120
hours) + (664 recalls for all other manufacturers x .20 = 133 recalls x
1 = 133).
As to the requirement that manufacturers notify NHTSA in the
[[Page 60793]]
event of a bankruptcy, we expect this notification to take an estimated
2 hours to draft and submit to NHTSA. We continue to estimate that only
10 manufacturers might submit such a notice to NHTSA each year, so we
calculate the total burden at 20 hours (10 MFRs x 2 hours).
We estimated that it takes manufacturers an average of 8 hours to
draft their notification letters, submit them to NHTSA for review, and
then finalize them for mailing to their affected owners and purchasers.
Alliance & Global commented that it believed its members generally
require 11 hours on average for these tasks. NHTSA does acknowledge its
estimate may be low for major passenger-vehicle manufacturers, of which
much of Alliance & Global are comprised. Accordingly, we estimate that
the 49 CFR part 577 requirements result in 8,601 burden hours annually
(8 hours per recall x 664 recalls per year) + (11 hours per recall x
299).
The burden estimate associated with the regulation that requires
interim owner notifications within 60 days of filing a Part 573 Safety
Recall Report must be revised upward. We previously calculated that
about 10 percent of past recalls require an interim notification
mailing, but recent trends show that 12 percent of recalls require an
interim owner notification mailing. We continue to estimate the
preparation of an interim notification can take up to 10 hours. We
therefore estimate that 1160 burden hours are associated with the 60-
day interim notification requirement (963 recalls x .12 = 116 recalls;
116 recalls times 10 hours per recall = 1160 hours).
As for costs associated with notifying owners and purchasers of
recalls, we continue to estimate a cost of $1.50 per first class mail
notification, on average. This cost estimate includes the costs of
printing, mailing, as well as the costs vehicle manufacturers may pay
to third-party vendors to acquire the names and addresses of the
current registered owners from state and territory departments of motor
vehicles. In reviewing recent recall figures, we determined that an
estimated 75.8 million letters are mailed yearly totaling $113,700,000
($1.50 per letter x 75,800,000 letters). The requirement in 49 CFR part
577 for a manufacturer to notify their affected customers within 60
days would add an additional $13,644,000 (75,800,000 letters x .12
requiring interim owner notifications = 9,096,000 letters; 9,096,000 x
$1.50 = $13,644,000). In total, we estimate that the current 49 CFR
part 577 requirements cost manufacturers a total of $127,614,000
annually ($113,700,000 for owner notification letters + $13,644,000 for
interim notification letters + $270,000 for VIN Look-up Tool operation
= $127,614,000).
NHTSA further has authority to require that, in an enforcement
action, vehicle manufacturers conduct supplemental recall
communications, potentially utilizing non-traditional means (e.g., text
messaging, social media). This is currently occurring in the Takata
recalls, which involve 19 vehicle manufacturers and approximately 46
million defective inflators currently under recall in approximately 34
million vehicles that need to be recalled as quickly as possible, given
that thirteen people in the United States have lost their lives to a
rupturing Takata inflator and more than two hundred people have
reported associated injuries, many of which were disfiguring or life-
threatening. The scope of the Takata recalls is unprecedented in the
agency's history. Therefore, the below analysis only takes into account
the expected paperwork burden of this collection over the next three
years, without making any assumptions about the likelihood of another
large-scale recall that leads to similar types of supplementary
notices. However, the agency believes the lessons learned from the
Takata recall will provide a useful guidepost in structuring any
similar future action.
To address the scope and complexity of the Takata recalls, NHTSA
issued a Coordinated Remedy Order, as amended on December 9, 2016 (the
``ACRO''), which requires affected vehicle manufacturers to conduct
supplemental owner notification efforts in coordination with NHTSA and
the Independent Monitor of Takata. On December 23, 2016, the Monitor,
in consultation with NHTSA, issued Coordinated Communications
Recommendations for vehicle owner outreach (``CCRs''), which includes a
recommendation that vehicle manufacturers provide at least one form of
consumer outreach per month for vehicles in a launched recall campaign
(i.e., a recall where parts are available) until the vehicle is
remedied (unless otherwise accounted for as scrapped, stolen, exported,
or otherwise unreachable under certain procedures in the ACRO). See
CCRs ] 1(b); ACRO ]] 45-46. The Monitor also recommended that
manufacturers utilize at least three non-traditional means of
communication (postcards; email; telephone calls; text message; social
media) as part of their overall outreach strategy. See CCRs ] 1(a). If
a vehicle manufacturer does not wish to follow the Monitor's
recommendations, the ACRO permits the manufacturer to propose an
alternative communication strategy to NHTSA and the Monitor.
Alliance & Global commented that supplemental recall communications
are not mandatory. NHTSA acknowledges this is generally the rule
(although the agency may require a manufacturer to provide additional
notifications if it determines the initial notification did not result
in an adequate number of remedied vehicles or equipment, see 49 U.S.C.
30119(e), 49 CFR 577.10), and appreciates manufacturers' efforts in
furtherance of the shared goal of remedying as many vehicles affected
by the Takata recalls as possible. Alliance & Global also cited to a
Notice of Proposed Rulemaking regarding additional owner notifications,
and drew a parallel between potential burdens associated with that
rulemaking and this information collection. NHTSA appreciates the
parallel, but emphasizes that the ACRO and CCRs prescribe distinct
requirements pursuant to NHTSA's enforcement authority, and that
neither those documents nor this notice involve a rulemaking.
Alliance & Global also commented that ``NHTSA did not identify all
of the Takata ACRO and related tasks that are subject to PRA
approval,'' and that the burden estimates should be revised
accordingly. Alliance & Global thereafter listed additional ``tasks''
under the ACRO, with associated burdens for which they believe NHTSA
must account here.\5\
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\5\ Alliance & Global, while identifying requirements, do not
offer an estimate of the associated burdens--observing they ``are
striving to collect aggregated data to permit an informed estimate
of the time and cost of these tasks, and intends to provide
supplemental comments to aid the agency's evaluation of these
burdens.''
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NHTSA recognizes the ACRO sets forth various requirements in
addition to the consumer outreach described above, but believes the
investigatory exception to the PRA, which specifically exempts
collections of information ``during the conduct of an administrative
action, investigation, or audit involving an agency against specific
individuals or entities,'' applies to such requirements. 5 CFR
1320.3(c), 1320.4(a)(2); 44 U.S.C. 3501 et seq. Accordingly, NHTSA's
responses to comments and burden estimates here are with respect only
to the monthly outreach requirements outlined above.
The Monitor's recommendations for outreach were adopted in
significant part because research supports that frequent notifications
using non-traditional means results in improved remedy completion. The
agency cited
[[Page 60794]]
several sources in its 60-day notice \6\ with which Alliance & Global
took issue, stating that ``NHTSA did not explain how supplemental
communications contemplated by the ACRO and the CCR are `necessary for
the proper performance of the functions of the agency, including
whether the information will have practical utility' '' as required by
OMB regulations. In relevant part, Alliance & Global's basis for this
assertion appears to be that NHTSA did not specifically prove that a
monthly cadence of outreach was more effective than other outreach
frequencies because NHTSA only cited to general research regarding
outreach frequency in support of this proposition. NHTSA recognizes
that these sources did not specifically conclude that monthly
notifications (instead of, e.g., weekly, bi-weekly, bi-monthly, etc.)
are always the most effective. But the sources to which NHTSA cites all
tend toward advocating greater notification frequency--not less--and
Alliance & Global do not point to any sources of their own that stand
specifically for the contrary. The very nature of the Takata recalls--
unprecedented and, as Alliance & Global recognize, ``extraordinary''--
means that no research will be perfectly on-point, and that in addition
to relying on lessons learned as the recall campaigns continue, it is
prudent to rely on other sources of probative information, including
information from relatively analogous settings such as advertising,
where the purpose is to locate specific consumers and effectively
communicate a specific message to those consumers. The underlying
principle, of frequent outreach via multiple communications methods, is
supported by the available information, including a recently released
report from the U.S. Government Accountability Office,\7\ as well as a
report from Independent Monitor specific to the very recalls at issue
here.\8\
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\6\ See 82 FR 45941; GM Safety Recalls: Innovations in Customer
Outreach (NHTSA Retooling Recalls Workshop, April 28, 2015); Auto
Alliance & NADA Survey Key Findings (November 2015); GM letter to
NHTSA in comment to NPRM, Docket No. NHTSA-2016-0001 (March 23,
2016); Susanne Schmidt & Martin Eisend, Advertising Repetition: A
Meta-Analysis on Effective Frequency in Advertising, 44 J.
Advertising 415, 425 (2015); Blair Entenmann, Marketing Help!, The
Principles of Targeted Direct Mail Advertising (2007); Chuck
Flantroy, Direct Mail Works: The Power of Frequency, Kessler
Creative (August 31, 2016).
\7\ See U.S. Government Accountability Office, Auto Recalls:
NHTSA Should Take Steps to Further Improve the Usability of Its
website (GAO-18-127) (Dec. 4, 2017), at 10-11, 13-15 (indicating
articulated safety risk is the most influential factor in owners'
decision to obtain repair, and that owners have additional
preference for receiving recall notification by electronic means).
\8\ See The Independent Monitor of Takata and Coordinated Remedy
Program, The State of the Takata Airbag Recalls (Nov. 15, 2017),
Section VIII.A, available at https://www.nhtsa.gov/sites/nhtsa.dot.gov/files/documents/the_state_of_the_takata_airbag_recalls-report_of_the_independent_monitor_112217_v3_tag.pdf. (``[T]he Monitor's research to date indicates
that communications regarding the recalls should be frequent and
clearly written with a call to action. . . . [and] shows that in
cases of highly dangerous recalls, affected vehicle owners want to
be notified with urgent, disruptive messages, repeated with great
frequency in order to better ensure they become aware of the issue
and understand its gravity.'').
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In a similar vein, the agency is also aware of generalized concerns
about ``notification fatigue,'' and invited comment on this phenomenon,
including the optimal frequency, content, mode, and method of recall/
defects notifications from manufacturers to consumers. The agency
previously stated its interest in any research or data on consumer
``fatigue'' that relates to a recall with potential consequences of
death or severe injury, as in the case of the Takata recalls. Alliance
& Global did not provide any information on this issue. Instead,
Alliance & Global noted that they are unaware of data-based research
that supports the notion that outreach pursuant to the ACRO actually
results in improved remedy completion. Setting aside findings of the
Independent Monitor that indicate otherwise, see n.8, this also
implicitly recognizes the central issue: The Takata recalls are
unprecedented, and that while it may be ``that no one knows `the
optimal frequency, content, mode and method' of communicating with
consumers about recalls, including whether `more' is always `better,'
'' the studies NHTSA cites indicate that more is in fact better.
Alliance & Global have cited no studies of their own to the contrary.
In any event, NHTSA appreciates Alliance & Global's comments as
part of the ongoing dialogue to better understand the relationship
between recall notification and recall completion. NHTSA has met, and
continues to meet, with numerous manufacturers to discuss this very
issue, including at regularly scheduled meetings for the vehicle
manufacturers affected by the Takata air bag inflator recalls. As
Alliance & Global acknowledge, affected vehicle manufacturers have been
working with the Independent Monitor to improve outreach results in the
Takata recalls, which should result in further understanding of the
issue. NHTSA will continue to monitor the development of knowledge in
this area, and looks forward to future collaboration with
manufacturers.
The volume of outreach required by the ACRO and the CCRs (and the
costs associated with that outreach) is a function of the number of
unrepaired vehicles that are in a launched campaign and are not
otherwise accounted for as scrapped, stolen, exported, or otherwise
unreachable. The schedule in Paragraph 35 of the ACRO delineates the
expected remedy completion rate, by quarter, of vehicles in a launched
remedy campaign.
NHTSA estimated a yearly average of 19 vehicle manufacturers
issuing monthly supplemental communications over the next three years
pursuant to the ACRO and the CCRs. Manufacturers may satisfy the CCRs
through third-party vendors (which many manufacturers are already
utilizing), in-house strategies, or some combination thereof. NHTSA
estimated the cost for supplemental communications at $0.44 per VIN per
month.
Utilizing these variables, we estimated an initial annualized cost
contemplated by the ACRO and CCRs over the next three years of
$43,557,722 per year, and discounted this annualized cost by the cost
of outreach efforts settling defendants in the Southern District of
Florida multi-district litigation (Toyota, Subaru, Nissan, BMW, Mazda,
and Honda) are required to conduct pursuant to their respective
settlements--which amounted to a discount of $15,721,393. See generally
In re: Takata Airbag Products Liab. Litig., 14-cv-24009, MDL No. 2599
(S.D. Fla.). Those outreach programs are to utilize non-traditional
methods of outreach, including telephone, email, social media, and text
messaging, and NHTSA anticipated they will produce outreach that would
satisfy the minimum requirements of the CCRs. In total, therefore, we
estimated the annualized burden at $27,836,329. NHTSA also estimated it
would take manufacturers 2 hours each month to draft or customize
supplemental recall communications utilizing non-traditional means,
submit them to NHTSA for review, and finalize them to send to affected
owners and purchasers.
Alliance & Global commented that, even assuming a cost of $0.44/
VIN, monthly outreach costs would actually total $108 million per year
based on the number of unremedied vehicles stated in the Independent
Monitor's report, The State of Takata Airbag Recalls (November 15,
2017). NHTSA notes, however, that such an estimate assumes that none of
those vehicles would actually be repaired (and therefore not subject to
outreach requirements) at any
[[Page 60795]]
point during a given year--a factor that NHTSA's methodology did take
into account, with reference to the schedule set forth in Paragraph 35
of the ACRO.
Alliance & Global also commented that the cost burden of this
outreach ``is far more than $0.44/VIN on average and requires more than
2 hours per month to prepare and administer.'' Alliance & Global,
however, provide an unclear picture of alternative estimates, offering
only ``initial average estimates'' of $2 to $5/VIN, and then observing
that other initiatives ``can further increase costs as high as
approximately $30 to more than $100/VIN.'' Indeed, at this time
Alliance & Global can only provide what it refers to be a low-end
estimate of a burden close to $40 million/month for its members
affected by the Takata recalls, ``expect[ing] to refine [their]
estimates in supplemental comments.'' And Alliance & Global offered no
alternative estimate to the NHTSA's estimated burden of 2 hours per
month to prepare and administer non-traditional outreach.
Alliance & Global appear to admit that their cost estimates are at
most preliminary, and therefore it is difficult for NHTSA to
significantly revise its cost estimate based on these comments.
However, NHTSA appreciates Alliance & Global's input, which provides
useful insight into the cost of these outreach programs--about which to
this point NHTSA has had relatively little information. NHTSA further
recognizes per-VIN outreach costs can vary significantly depending on
the vehicles and owners involved, as well as the particular strategies
manufacturers have selected to engage in consumer outreach for
different recalls at different levels of maturity. Accordingly, NHTSA
accepts Alliance & Global's assertion that, on average, a per-VIN-per-
month outreach estimate of $0.44 is low, and will revise its estimate
to $2/VIN per month. NHTSA will retain its estimated burden of 2 hours
per month to prepare and administer non-traditional outreach. NHTSA
looks forward to additional insights it may gain from supplemental
information Alliance & Global may submit.
Alliance & Global also commented that discounting the annualized
outreach costs by costs of anticipated outreach pursuant to MDL
settlements was not ``an appropriate baseline for this cost analysis.''
Alliance & Global stated the outreach efforts the settling
manufacturers were conducting pursuant to the ACRO and CCRs facilitated
their MDL settlements, and that the ACRO and CCRs predated the MDL
settlements. Alliance & Global also posited that it is ``premature'' to
assume outreach efforts under the ACRO and CCRs will satisfy the MDL
settlement obligations. Assuming, for the sake of argument, that the
ACRO and CCRs ``facilitated'' the MDL settlements, it is of no
consequence; going forward, those settling vehicle manufacturers must
comply with the terms of their respective settlements, which include
provisions for enhanced outreach efforts. While NHTSA acknowledges the
exact nature of this outreach is presently unclear, at this juncture
NHTSA anticipates it is more likely than not that the outreach efforts
conducted under the settlements would satisfy the minimum requirements
of the ACRO and CCRs. Alliance & Global have provided no indication
otherwise.
Accordingly, NHTSA estimates the terms of the ACRO and the CCRs,
assuming remedy-completion rates consistent with those set forth in the
former, contemplate an initial annualized cost of $197,989,647 per year
for the next three years (2018-2020), with an annualized discount of
$71,460,877 to account for outreach conducted pursuant to the MDL
settlements described above, for a net annualized cost of $126,528,770.
NHTSA estimates that manufacturers will take an average of 2 hours each
month drafting or customizing supplemental recall communications
utilizing non-traditional means, submitting them to NHTSA for review,
and finalizing them to send to affected owners and purchasers. NHTSA
therefore estimates that 456 burden hours annually are associated with
issuing these supplemental recall communications (12 months x 2 hours
per month x 19 manufacturers = 456 hours).
Because of the forgoing burden estimates, we are revising the
burden estimate associated with this collection. The 49 CFR part 573
and 49 CFR part 577 requirements found in today's notice will require
63,606 hours each year. Additionally, manufacturers impacted by 49 CFR
part 573 and 49 CFR part 577 requirements will incur a recurring annual
cost estimated at $127,614,000 total. The burden estimate in this
collection contemplated for conducting supplemental recall
communications under the ACRO to achieve completion of the Takata
recalls is 456 hours each year. Additionally, the ACRO contemplates
impacted vehicle manufacturers incurring an annual cost estimated at
$126,528,770. Therefore, in total, we estimate the burden associated
with this collection to be 64,062 hours each year, with a recurring
annual cost estimated at $254,142,770.
Estimated Number of Respondents--NHTSA estimates that there will be
approximately 274 manufacturers per year filing defect or noncompliance
reports and completing the other information collection
responsibilities associated with those filings. NHTSA estimates there
will be an average of 19 manufacturers each year conducting
supplemental nontraditional monthly outreach pursuant to administrative
order in an enforcement action associated with the Takata recall.
Jeffrey Giuseppe,
Associate Administrator for Enforcement.
[FR Doc. 2017-27635 Filed 12-21-17; 8:45 am]
BILLING CODE 4910-59-P