APPENDIX B
On February 12, 2002, John D. Graham, Ph.D., Administrator, Office of Information and Regulatory Affairs, Office of Management and Budget (OMB) sent a return letter (see NHTSA Docket 2000, 8572-202) to Kirk K. Van Tine, General Counsel of the Department of Transportation returning the rule on tire pressure monitoring systems for reconsideration of two analytic concerns related to safety. First, OMB identified a regulatory alternative that NHTSA did not explicitly analyze. OMB claimed that this alternative may provide more safety to consumers than the draft version of the final rule. OMB stated that NHTSA should consider an alternative that would allow the current indirect systems and consider the impact that this regulatory alternative would have on the availability of anti-lock brake systems (ABS). As an alternative OMB suggested that the agency could defer a decision about the ultimate fate of indirect systems, until the potential impact on installation of anti-lock brake systems is better understood.
Second, OMB stated that the technical foundation for NHTSA’s estimates of safety benefits need to be better explained and subjected to sensitivity analysis. OMB recommended that a “carefully conducted survey and analysis of driver behavior and corresponding tire pressures in TPMS-equipped vehicles currently on the road would go a long way toward refining the estimates…”
Appendix B is NHTSA’s response to the OMB return letter.
Regarding OMB’s first analytic concern: The agency has examined an alternative (Alternative 4) that would allow current indirect systems to meet the standard. Current indirect systems provide a warning when one tire is 30 percent or more below placard, given our test procedure. This alternative has been included in this version of the Final Economic Assessment.
As shown in the Executive Summary, Alternative 4 results in the least amount of overall safety benefits and the lowest amount of costs and net costs. Alternative 4 results in the highest net cost per equivalent life saved. Thus, based on the information available at this time, Alternative 4 would not be the alternative chosen by NHTSA for the final rule for MY 2007 and thereafter. NHTSA attempts to choose an alternative that provides the most safety benefit at the lowest net cost per equivalent life saved.
Alternative 4 does not consider, as OMB requested, the impact of this alternative on the availability of ABS brakes for two reasons. First, NHTSA analyzes the impacts of its requirements on what they compel the manufacturers to do to meet the standard. Nothing requires them to install anti-lock brakes on more vehicles to meet the TPMS final rule. In our opinion, voluntarily installing anti-lock brakes on more vehicles is a marketing decision. In fact, it is the highest cost option available to the manufacturers. A manufacturer always has the option of providing a countermeasure that exceeds our standards, spending more money, and providing more safety. However, in this case we believe that this option costs more but does not provide more safety. OMB is asking us to assume that manufacturers will elect to install more anti-lock brakes if we allow the current indirect systems; then, using that assumption, to compare the potential benefits and costs of the alternatives.
We have discussed the possibility that a manufacturer could increase the use of anti-lock brakes, but that is a marketing decision. The influence this rulemaking has on manufacturers’ marketing decisions is difficult to prove. Toyota is the only manufacturer that indicated that it would make ABS standard equipment on more vehicles if an indirect system were allowed. This was not provided in a docket comment in writing, but provided orally to NHTSA in meetings. But, nothing requires them to do so, and they could change their decision at any time. There are many things that influence a manufacturer’s decision to voluntarily install equipment. The cost impact and the impact on sales are not the only considerations. There is no way that the agency could predict whether the difference in cost between the indirect and hybrid or direct systems would be enough to sway a voluntary marketing decision.
Second, as shown on pages V-82 to V-85, the agency has not found a statistically significant overall fatality benefit for ABS. As a matter of fact, in the two most recent anti-lock brake evaluations by Framer and Hertz, the only statistically significant findings were that fatalities increased with ABS in certain situations. Thus, in our opinion, there is no proven additional overall fatality safety benefit from ABS. In our opinion, from a safety perspective, not from a marketing perspective, it makes no sense to assume a higher cost ABS system will be used as a countermeasure in an alternative with no additional fatality benefit. The net cost per equivalent life saved will certainly be higher. Thus, we do not believe that Alternative 4, even if we considered the possibility of a market based shift to anti-lock brakes, would provide more safety benefits to consumers than the other alternatives.
Regarding OMB’s second analytical concern: We will address the points made regarding providing additional information and sensitivity analyses around assumptions made in the assessment. Because of the decision made to postpone the final decision on MY 2007 and thereafter requirements, the value of providing additional sensitivity analyses at this time has significantly diminished. Sensitivity analyses may be useful in determining the long-term requirements, but are not needed for the phase-in where both direct and indirect systems could meet the requirements. Instead, the agency is looking into ways to provide additional information that would provide more insight into the estimations and assumptions made.
The agency is committed to providing another tire pressure survey and analyzing it by March 1, 2004. In the second tire pressure study, the agency will compare the tire pressures of vehicles without a TPMS to the tire pressures of vehicles equipped with a TPMS that does not meet a four-tire, 25 percent compliance option. If sufficient data are available, the agency also will assess the performance and effectiveness of TPMSs that do meet a four-tire, 25 percent option. The study will give the agency additional information regarding the extent to which vehicles equipped with a TPMS that does not meet a four-tire, 25 percent option have tire pressures closer to the placard pressure than vehicles without a TPMS. The study also will give the agency additional information regarding the extent to which vehicles equipped with a TPMS that does not meet the four-tire, 25 percent option have fewer significantly under-inflated tires than vehicles without a TPMS.
One of the assumptions that OMB questions is that 95 percent of consumers would respond effectively to a warning light indicating that a vehicle has a tire inflation problem. The agency has no hard data to support this assumption. As discussed on pages V-3 to V-5, a recent survey supports a very high estimate, but it is not a reliable sample. The agency has attempted to find studies indicating response rates to other similar warning lights without success. The agency is planning on questioning TPMS vehicle owners during our up-coming tire pressure survey on whether their tire pressure light has come on and how they reacted to it, to provide data to help answer this question. The agency does not feel that a telephone survey would provide data as useful as a survey of owners with specific experience.
OMB questioned the safety benefits estimates stemming from reduced skidding and better control since they were based on a study published in 1977, before the widespread existence of front-wheel drive, radial tires, and SUVs and minivans. The agency has no later data of this quality on the causes of crashes. The agency has started to collect tire pressure in 2002 as part of its NASS-CDS data collection, but this is not a system designed to determine the cause of the crash. Thus, we do not anticipate having any further data on this issue. Directionally, we know the analysis is correct. If this becomes a critical element in the final decision, we can do sensitivity analyses on the magnitude of the safety benefit.
OMB questioned our use of the Goodyear data, instead of our own VRTC data in analyzing the stopping distance affect of tire inflation pressure. There are a number of reasons why we felt the Goodyear data were better than the agency’s own data for this analysis. These are discussed on pages V-12 to V-14.
OMB also questioned why the agency used the Goodyear data on a minivan to represent passenger cars. The critical element that is being measured is the difference in the tire's response when underinflated. The absolute stopping distance will vary by vehicle weight and other vehicle performance characteristics, but these same characteristics would influence both the properly inflated and the underinflated tests in a similar fashion. Therefore, while the tested sample was confined to only a few vehicles, the differences measured under various inflation levels should still be indicative of the type of impact that could be expected. Obviously, a larger sample of vehicle tests would be desirable, but given the more critical limitations of the other tests, we believe that the most representative data currently available is contained in the Goodyear tests.
OMB also questioned our assumption that 20 percent of blowouts are caused by low tire pressure. The agency hopes that its collection of tire pressure in NASS-CDS will provide some useful data for this issue. Obviously, you can’t get the tire pressure from the tire that experienced the blowout, but the other tires can be checked to see whether the other tires had low tire pressure.
The agency has decided to collect more data before making its decision on the ultimate fate of TPMS system for MY 2007 and thereafter.
It is very possible that the capabilities and cost of TPMS systems could change significantly over the next few years. The agency is maintaining an open docket to continue to collect information that may help its analysis. We anticipate that developments in batteries could significantly reduce the maintenance costs of direct systems. Information on changing systems could significantly change the results of the agency’s analysis.