TarasPort Trailers, Inc.; Grant of Application for Temporary Exemption From Federal Motor Vehicle Safety Standard No. 224

DEPARTMENT OF TRANSPORTATION

National Highway Traffic Safety Administration

[Docket No. NHTSA-99-4966; Notice 2]

TarasPort Trailers, Inc.; Grant of Application for Temporary

Exemption From Federal Motor Vehicle Safety Standard No. 224

We are granting the application by TarasPort Trailers, Inc., of

Sweetwater, Tennessee, for a temporary exemption from Motor Vehicle

Safety Standard No. 224 Rear Impact Protection, as provided by 49 CFR

part 555, finding that ``compliance would cause substantial economic

hardship to a manufacturer that has tried in good faith to comply with

the standard.'' Sec. 555.6(a).

On January 13, 1999, we published a notice inviting comment on

TarasPort's application (64 FR 2273). The salient points of the

application are set out below.

Why TarasPort Needs a Temporary Exemption

Located in the Sweetwater Industrial Park in Monroe County,

Tennessee, TarasPort has manufactured trailers since April 1988.

Standard No. 224 requires, effective January 26, 1998, that all

trailers with a GVWR of 4536 Kg or more be fitted with a rear impact

guard that conforms to Standard No. 223 Rear impact guards. TarasPort

manufactured a total of 237 trailers in 1997, including ``two models of

drop decks equipped with rear deck extenders.'' The extenders deploy in

1-foot increments, up to 3 feet, from the rear of the trailer. S5.1.3

of Standard No. 224 requires that the horizontal member of the rear

impact guard must be as close as practicable to the rear extremity of

the vehicle, but in no case farther than 305 mm. from it. TarasPort had

asked NHTSA to exclude its two trailer models as ``special purpose

vehicles,'' but we denied its request. We also determined that the

trailers' rear extremity, with the extenders deployed ``would be the

rearmost surface on the extenders themselves.'' In order to meet

S5.1.3, TarasPort must redesign these models so that the rear face of

the horizontal member of the guard will never be more than 305 mm

forward of the rearmost surface on the extenders, when the extenders

are in any position in which they can be placed when in transit. It has

asked for a 2-year exemption in order to do so.

Why Compliance Would Cause TarasPort Substantial Economic Hardship

TarasPort employs 16 people, including its two working owners. An

increasing amount of its sales is comprised of the two extended-deck

trailers, from 55% in 1997 to 63% in the first two quarters of 1998.

Using its existing staff, the company estimates that it needs 18 to 24

months of design and testing to bring the trailers into compliance with

S5.1.3, and that the modifications required will cost $1800 to $2000

per trailer.

If the application is denied, TarasPort would have to discontinue

production for 18 to 24 months, or hire an engineering consulting firm

to possibly reduce that time, at a fee of $80 to $120 an hour. It would

be forced to lay off a majority of its employees, and it would lose the

market and established customer base that it has achieved as a niche

producer over the 10 years of its existence.

According to its financial statements, TarasPort has had a small

net income in each of its past three fiscal years, though the income

each year has been substantially less than the year before. The net

income for 1997 was $87,030.

How TarasPort Has Tried To Comply With the Standard in Good Faith

Most of TarasPort's trailers have low deck heights and rear ramp

compartments ``which only compound rear impact compliance problems.''

Nevertheless, the company was able to bring its designs into compliance

by Standard No. 224's effective date, with the exception of the two

extender designs. These trailers comply when the extenders are not in

use. The company tested mounting the guard directly on the extenders

``so it would move out and thus comply,'' but found that this method of

mounting ``would not absorb the level of energy'' required by Standard

No. 223. TarasPort hoped that we would consider the extenders to be

load overhang or exempt as a special purpose vehicle, but we denied

this request on May 22, 1998.

[[Page 13845]]

Why Exempting TarasPort Would Be Consistent With the Public

Interest and Objectives of Motor Vehicle Safety

A denial would adversely affect the company's employees, customers,

and the local economy in Monroe County. TarasPort argued that the motor

vehicle safety standards

were created with the general public's well being in mind.

Assisting our company to comply to those standards only insures

public safety. Compliance rather than enforcement is consistent with

the objectives of the National Traffic and Motor Vehicle Safety Act.

Comments Filed in Response to the Application Notice

No comments were filed in response to the notice published on

January 13, 1999.

Discussion of TarasPort's Application

When TarasPort learned in May 1998 that its two trailer models

would have to comply with Standard No. 224, it filed its application

for exemption with us the following month. Because we needed to resolve

TarasPort's requests for confidentiality, we were unable to move

forward with its exemption request until January 1999. Accordingly, we

must assume that the company has been experiencing the hardships

foreseen in its application.

These hardships are loss of income from reduced production, and the

possible layoff of some of its 16 employees as a result. The company's

application indicated that it would find it more economical to engineer

a solution in-house over an 18 to 24 month time period than to commit

it to an engineering firm for a costly solution in something less than

that time. The company's net income has been decreasing in each of its

three past fiscal years, and presumptively did so in 1998 when it

suspended production of its two models of drop deck trailers equipped

with rear deck extenders. We believe that TarasPort has demonstrated

that requiring immediate compliance would cause it substantial economic

hardship.

We note that TarasPort, in spite of limited resources, was able to

bring all its other trailers into conformity with Standard No. 224 by

its effective date. We believe that the company has therefore made a

good faith effort to comply with the standard.

TarasPort contributes to its local economy, even though it is a

small business. It is in the public interest to encourage small

businesses which add diversity to the marketplace. The temporary

exemption of a small number of trailers from the underride standard

will not have a significant negative effect upon safety.

As of the end of June 1998, the company estimated that it would

need 18 to 24 months to comply with the standard. This indicates that

the company believes it can achieve compliance between January 1 and

July 1, 2000. We are therefore giving it an exemption until July 1,

2000.

The Administrator's Findings

On the basis of the arguments and discussions above, I find that

providing TarasPort an exemption from Standard No. 224 is consistent

with the public interest and the objectives of 49 U.S.C. Chapter 301--

Motor Vehicle Safety, and that compliance with Standard No. 224 would

cause substantial economic hardship to a manufacturer that has tried to

comply with the standard in good faith.

NHTSA Temporary Exemption

No. 99-2

TarasPort Trailers, Inc., is hereby granted NHTSA Temporary

Exemption No. 99-2, from 49 CFR 571.224 Standard No. 224 Rear Impact

Protection, expiring July 1, 2000. This exemption is restricted to drop

deck trailers equipped with rear deck extenders.

Authority: 49 U.S.C. 30113; delegation of authority at 49 CFR

1.50.

Issued on: March 16, 1999.

Ricardo Martinez,

Administrator.

[FR Doc. 99-6846 Filed 3-19-99; 8:45 am]

BILLING CODE 4910-59-P