Fixing America’s Surface Transportation (FAST) Act Could Spell Trouble for Tire Manufacturers, Distributors and Retailers
On December 4, 2015, President Obama signed into law a massive (1,300-page) five-year, $281 billion transportation bill that not only covers highway, transit and rail project funding but also includes the following important provisions regarding tires:
- Tire retailers will be required to register tires at the time of purchase. This means customer-contact information will be obtained and stored electronically when a customer buys tires, which will facilitate recalls. Previously, only some retailers collected customer information at the time of purchase, and customers were given postcards to mail in their contact information, but most failed to do so. Accordingly, this new requirement should make future recalls more effective.
- Another portion geared toward future recalls requires the National Highway Traffic and Safety Administration to develop an online tool for consumers to search by tire-identification number (TIN), often called the “DOT number,” to confirm whether a tire is subject to recall. TINs are alphanumeric codes on a tire’s sidewall that, among other things, confirm where and when the tire was made.
- The bill sets a minimum tire-fuel-efficiency performance standard intended to make tires more fuel-efficient and eliminate less fuel-efficient tires from the market.
- A wet-traction performance standard will make sure the fuel-efficiency standard does not reduce a tire’s traction capability on wet pavement in the process of increasing efficiency.
We will continue to track implementation of this transportation bill relative to its impact on the tire manufacturing industry. Although the main objective of the bill is to improve tire safety and reduce accidents, this new law could have some unintended negative effects for our clients. As is the case with previous legislation passed by the government to improve product performance and safety standards, we believe this bill will lead to increased costs of production as well as greater risk exposure for manufacturers, distributors and retailers.