Chrysler Corp. v. Department of Transportation (515 F.2d 1053, 1975)

PHILLIPS, Chief Judge.

Chrysler Corporation has petitioned this court for review of an order of the National Highway Traffic Safety Administration (NHTSA). The order in question amended Federal Motor Vehicle Safety Standard No. 108, 49 C.F.R. § 571.108, to permit the use of rectangular headlamps of specified dimensions in motor vehicles manufactured between January 1, 1974 and September 1, 1976. Chrysler generally favors the option to depart from the conventional circular headlamp shape but challenges the dimensional restriction and the time limitation. For the reasons set forth below, we conclude that Chrysler’s petition must be denied.

I

Under the National Traffic and Motor Vehicle Safety Act of 1966, 15 U.S.C. § 1381 et seq., the NHTSA is authorized to establish minimum safety standards for the performance of motor vehicles and motor vehicle equipment. Standard No. 108 generally covers lamps, reflective devices, and associated equipment. Before adoption of the amendment that is being challenged here, Standard No. 108 permitted only two headlamp systems: (1) a two-lamp system composed of two circular lamps, 7 inches in diameter, capable of producing two beams, and (2) a four-lamp system, capable of producing two beams, composed of two circular, single-filament lamps, 5% inches in diameter, and two circular, dual-filament lamps, 5% inches in diameter.

For some time General Motors Corporation had been involved in a development program for rectangular headlamps. In late 1972, General Motors petitioned the NHTSA to amend Standard No. 108 to permit the use of rectangular headlamps. The petition proposed lamp dimensions of approximately 6V2 inches by 4 inches.

On June 8, 1973, the NHTSA, in response to General Motors’ petition, published Notice 5, which proposed an amendment to Standard No. 108 and invited comments. Under Notice 5, manufacturers would be given the option to use rectangular headlamps measuring approximately 6V2 inches by 4 inches in the four-lamp system described above. The NHTSA explained the proposed amendment as follows:

Where there is an equivalency of photometric output between headlamps with circular and rectangular lenses, the NHTSA has no evidence that one shape is superior to another. The rectangular shape in various sizes has been used extensively in Europe during the last 10 years, and a number» of foreign manufacturers selling vehicles in the United States have had to redesign their front ends so that round headlamps can be installed to meet standard No. 108. Allowing an alternate headlamp shape would relieve a design restriction imposed by standard No. 108, and permit manufacturers such as General Motors greater styling latitude in meeting front lighting performance requirements. Balanced against greater design freedom, however, is the safety consideration that there should not be such a tion of headlamp shapes and the motorist who has an immediate need to replace a headlamp has difficulty in finding one. Thus GM’s suggestion that all dimensional requirements be eliminated has not been found to have merit. prol if era-sizes that

In consideration of these factors, the NHTSA is proposing the specific headlamp dimension that GM discussed in its petition (a lens approximately 6V2 in. by 4 in.). At this time, the agency’s intent is to decide on one size for rectangular lenses, although it is possible that other manufacturers may have under development rectangular systems of different dimensions. Should comments indicate that this is the case, and that the proposed dimensions are inappropriate for these other systems, the NHTSA will review the matter carefully in reaching a decision whether to proceed with or to terminate rule-making action on this subject. 38 Fed.Reg. 15082 (1973).

Notice 5 gave no indication that the rectangular headlamp option would be available only for a limited time. In fact, the proposed effective date of the amendment was to be 30 days after final adoption rather than 180 days, as the Act requires in most circumstances.

A number of comments were filed in response to Notice 5, and on November 30, 1973, the NHTSA published Notice 7, which formally adopted the option to use in the four-lamp system rectangular headlamps of essentially the dimensions specified in Notice 5. However, the amendment as adopted made the new option applicable only to vehicles manufactured between January 1, 1974 and September 1, 1976. Notice 7 explained the time limitation as follows:

These amendments to Standard No. 108 represent an interim rather than a final decision on the issues of rectangular headlamps and appropriate dimensions. During 1974 and 1975 NHTSA expects the world motor vehicle industry, through international standards organizations and regular trade and professional associations, to arrive, if possible, at a consensus for one set of requirements, including dimensions for rectangular headlamps. Late in 1975, the NHTSA intends to announce its final decision on the matter: whether to remain with the requirements and dimensions adopted in this notice, to propose and adopt others, or to revoke the option. The agency at this point is not committing itself either to adopt any consensus dimensions or to perpetuate the ones desired by General Motors, though the field experience with such lamps over the next two years may be expected to have some influence in the final decision. Adoption of these optional dimensions by a manufacturer during this interim period is at his own risk, and the cost of changing over from interim to permanent dimensions, if different, in 1977 model year tooling will not be considered a material factor in the decision on permanent dimensions. It is planned that the interim amendment will be in effect through August 31, 1976, and that no petitions will be entertained for variant headlamp dimensions or system configurations before the end of that period, to avoid multiplying stock items and disrupting supply channels. 38 Fed.Reg. 33085 (1973).

Finally, Notice 7 provided that the amendment would become effective on January 1, 1974 for the following reason:

Because the amendment creates an optional system without imposing new mandatory requirements on any person it is found for good cause shown that an effective date earlier than 180 days after the issuance of the amendment is in the public interest. 38 Fed. Reg. 33086 (1973).

On December 21, 1973, Chrysler petitioned the NHTSA for reconsideration of the amendment to Standard No. 108. Chrysler argued that the time limitation was unreasonable, impracticable, and unrelated to motor vehicle safety and therefore was invalid under the Act. In April 1974, the NHTSA issued Notice 8 denying Chrysler’s petition and further explaining the rationale underlying the time limitation:

The purpose of the time limit is to provide an interim period in which rectangular headlamps can be judged on their merits, and in which a worldwide consensus can be obtained as to a single set of dimensions for them. A rulemaking action which has as its goals the evaluation of a safety-related vehicle system within a specified time interval meets the need for motor vehicle safety. While it is true that the option termination date was not included in the NPRM (Notice 5), the NHTSA finds that adequate safeguards have been provided by the announcement in Notice 7 that it will make a final decision late in 1975 on the subject. If the decision is to terminate the option, that decision will be the subject of a rulemaking action, and an opportunity afforded for comment. An important consideration is the possibility that on September 1, 1976, a different set of dimensions may become effective. The time limit is designed to facilitate planning, by placing the industry on notice of the interval within which the NHTSA will act on the issue. The NHTSA deemed this course of action preferable to an open-ended amendment. 39 Fed.Reg. 14210 (1974).

As provided by 15 U.S.C. § 1394(a)(1), Chrysler has now petitioned this court for review of the amendment to Standard No. 108.

II

The Motor Vehicle Safety Act sets forth a number of substantive requirements that each safety standard must meet. For example, the Act defines safety standard as “a minimum standard for motor vehicle performance, or motor vehicle equipment performance, which is practicable, which meets the need for motor vehicle safety and which provides objective criteria.” 15 U.S.C. § 1391(2). This definition is reinforced by another section providing that each “standard shall be practicable, shall meet the need for motor vehicle safety, and shall be stated in objective terms.” 15 U.S.C. § 1392(a). Moreover, in prescribing safety standards, the NHTSA must consider whether the standard is “reasonable, practicable and appropriate for the particular type of motor vehicle or item of motor vehicle equipment for which it is prescribed,” and it must consider the extent to which the standard will contribute to carrying out the purposes of the Act. 15 U.S.C. § 1392(f)(3)-(4).

In addition to these substantive criteria, safety standards also must meet certain procedural requirements. For example, the Administrative Procedure Act (APA) applies to all NHTSA orders establishing, amending, or revoking a safety standard. 15 U.S.C. § 1392(b). The NHTSA may amend a safety standard, as it did in this case, through an informal rule-making proceeding pursuant to § 4 of the APA, 5 U.S.C. § 553, rather than through formal adjudication under §§ 7 and 8 of the APA, 5 U.S.C. §§ 556, 557. National Tire Dealers & Retreaders Ass’n v. Brinegar, 160 U.S.App.D.C. 238, 491 F.2d 31, 34-35 (1974); Chrysler Corp. v. Department of Transportation, 472 F.2d 659, 667-68 (6th Cir. 1972); Wagner Electric Corp. v. Volpe, 466 F.2d 1013, 1014-15 (3d Cir. 1972). Thus the NHTSA must follow the procedures outlined in § 4 of the APA, including the requirement that the notice of proposed rule making must include “either the terms or substance of the proposed rule or a description of the subjects and issues involved.” 5 U.S.C. § 553(b)(3).

Finally, we must review the amendment to Standard No. 108 in accordance with § 10 of the APA, 5 U.S.C. § 706. See 15 U.S.C. § 1394(a)(3); Chrysler Corp. v. Department of Transportation, 472 F.2d 659, 670 (6th Cir. 1972). Thus Standard No. 108 cannot stand if it is “arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law.” 5 U.S.C. § 706(2)(A).

Against this statutory background, Chrysler launches substantive and procedural attacks against both the dimension restriction and the time limitation. We consider each in turn.

Ill

Chrysler first contends that the' dimensional restriction does not meet the need for safety as required by the Motor Vehicle Safety Act. See 15 U.S.C. §§ 1391(2), 1392(a). Chrysler essentially does not believe that proliferation of headlamp shapes and sizes will' make it more difficult for motorists to obtain replacement lamps when the original equipment burns out or otherwise fails.

The record in this case, however, contains ample support for the NHTSA’s conclusion that if headlamp sizes prolif-. erate, many retailers will find it economically infeasible to stock the less popular types. As a result, some motorists will be unable to obtain replacements quickly and will continue driving even though one or more of the headlamps is inoperative. On the other hand, if only a few basic types of headlamps are in use, even the smallest retailer will be able to carry a full line of replacement lamps, thereby making it easier for motorists to avoid dangerously protracted periods of driving with a partially nonfunctioning headlamp system. This rationale is both logical and fully supported by the record. Accordingly, we cannot say that the dimension restriction imposed by the NHTSA does not meet the need for safety-

Chrysler suggests, however, that this argument, carried to the extreme, would authorize the NHTSA to prescribe a standard shape and design for all automobile components, a result clearly not intended by Congress. The short answer to this contention is that few auto parts are like headlamps. The record in this case indicates that the loss of one headlamp often will not induce a motorist to stop driving until a replacement can be found, even though forward illumination may be sharply reduced. Most other types of equipment failure either will not create a serious safety problem, or will present such obvious dangers that the driver will stop immediately for repairs or will immobilize the automobile entirely. Headlamp failure is singular in its capacity to jeopardize highway safety without arousing commensurate fear in the driver. Thus our analysis here is not, necessarily applicable to cases in which the NHTSA may seek to standardize the design of other motor vehicle components in the name of safety.

Chrysler next argues that the dimensional restriction amounts to an invalid design restriction that is inconsistent with the definition of motor vehicle safety standards as minimum standards for vehicle or equipment performance. 15 U.S.C. § 1391(2). It is conceded that the Act defines “safety” at least in part in terms of design:

“Motor vehicle safety” means the performance of motor vehicles or mo'tor vehicle equipment in such a manner that the public is protected against unreasonable risk of accidents occurring as a result of the design, construction or performance of motor vehicles . . . 15 U.S.C. § 1391(1) (emphasis added).

Chrysler refers us, however, to the legislative history underlying the inclusion of the word “design” in this section:

The addition of the word “design” was accepted by the House managers not as an expansion of the authority of the Secretary but merely to clarify that the public is to be protected from inherently dangerous designs which conflict with the concept of motor ve-hide safety and the performance standards issued by the Secretary, The Secretary is not to become directly involved in questions of design.

H.R.Rep.No.1919, 89th Cong., 2d Sess. (1966), 1966 U.S.Code Cong. & Admin. News, p. 2732.

Thus it appears that the presence of the word “design” was not intended to negate the basic concept that safety standards should be expressed in terms of performance rather than design. The rationale for this emphasis upon perform-anee criteria was discussed briefly m the Senate Committee Report:

Unlike the General Services Administration’s procurement standards, which are primarily design specifications, both the interim standards and the new and revised standards are expected to be performance jstandards, specifying the required minimum safe performance of vehicles but not the manner in which the manufacturer is to achieve the specified performance (sec. 101(b)). Manufacturers and parts pliers will thus be free to compete in developing and selecting devices ^structures that can meet or surpass the performance standard.

The Secretary would thus be concerned with the measurable perform-anee of a braking system, but not its design details. Such standards will be analogous to a building code which specifies the minimum load-carrying characteristics of the structural members of a building wall, but leaves the builder free to choose his own materi-ais and design. Such safe perform-anee standards are thus not intended or likely to stifle innovation in automotive design.

S.Rep.No.1301, 89th Cong., 2d Sess. (1966), 1966 U.S.Code Cong. & Admin. News, pp. 2713-14.

These excerpts lead us ,to conclude that Congress had two purposes in directing the NHTSA to establish performance standards rather than design standards. First, Congress decided that the need for safety could best be met by encouraging competition among manufacturers in devising methods to achieve objective performance goals. Secondly, Congress evidently wished to avoid the tedious stylistic uniformity that would result if the NHTSA undertook to control vehicle design on a broad scale. The overriding purpose of the Act as a whole, of course, is “to reduce traffic accidents and deaths and injuries to persons resulting from traffic accidents.” 15 U.S.C. § 1381.

It ig apparent to us that the dimen_ .gi