[Federal Register: April 28, 2009 (Volume 74, Number 80)]
[Proposed Rules]
[Page 19148-19154]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr28ap09-15]
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FEDERAL TRADE COMMISSION
16 CFR Part 259
Guide Concerning Fuel Economy Advertising for New Automobiles
AGENCY: Federal Trade Commission.
ACTION: Proposed rule.
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SUMMARY: The Federal Trade Commission (``FTC'' or ``Commission'') is
seeking comments on proposed amendments to the FTC's Guide Concerning
Fuel Economy Advertising for New Automobiles (``Fuel Economy Guide'' or
``Guide''). The amendments would amend the Guide to reflect changes to
the Environmental Protection Agency's (``EPA'') fuel economy labeling
rules for new automobiles and to take into account developments in
automobile technology.
DATES: Written comments must be received by June 26, 2009.
ADDRESSES: Interested parties are invited to submit written comments
electronically or in paper form. Comments should refer to ``Fuel
Economy Guide Review, Matter No. R711008'' to facilitate the
organization of comments. Please note that your comment--including your
name and your state--will be placed on the public record of this
proceeding, including on the publicly accessible FTC Website, at
(http://www.ftc.gov/os/publiccomments.shtm).
Because comments will be made public, they should not include any
sensitive personal information, such as an individual's Social Security
Number; date of birth; driver's license number or other state
identification number, or foreign country equivalent; passport number;
financial account number; or credit or debit card number. Comments also
should not include any sensitive health information, such as medical
records or other individually identifiable health information. In
addition, comments should not include any ``[t]rade secret or any
commercial or financial information which is obtained from any person
and which is privileged or confidential. . . .,'' as provided in
Section 6(f) of the Federal Trade Commission Act (``FTC Act''), 15
U.S.C. 46(f), and FTC Rule 4.10(a)(2), 16 CFR 4.10(a)(2). Comments
containing material for which confidential treatment is requested must
be filed in paper form, must be clearly labeled
[[Page 19149]]
``Confidential,'' and must comply with FTC Rule 4.9(c), 16 CFR
4.9(c).\1\
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\1\ The comment must be accompanied by an explicit request for
confidential treatment, including the factual and legal basis for
the request, and must identify the specific portions of the comment
to be withheld from the public record. The request will be granted
or denied by the Commission's General Counsel, consistent with
applicable law and the public interest. See FTC Rule 4.9(c), 16 CFR
4.9(c).
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Because paper mail addressed to the FTC is subject to delay due to
heightened security screening, please consider submitting your comments
in electronic form. Comments filed in electronic form should be
submitted by using the following weblink: (https://
secure.commentworks.com/ftc-fueleconomyguide) (and following the
instructions on the web-based form). To ensure that the Commission
considers an electronic comment, you must file it on the web-based form
at the weblink (https://secure.commentworks.com/ftc-fueleconomyguide).
If this Notice appears at (http://www.regulations.gov/search/
index.jsp), you may also file an electronic comment through that
website. The Commission will consider all comments that regulations.gov
forwards to it. You may also visit the FTC Website at http://
www.ftc.gov to read the Notice and the news release describing it.
A comment filed in paper form should include the ``Fuel Economy
Guide Review, Matter No. R711008'' reference both in the text and on
the envelope, and should be mailed or delivered to the following
address: Federal Trade Commission, Office of the Secretary, Room H-135
(Annex F ), 600 Pennsylvania Avenue, NW, Washington, DC 20580. The FTC
is requesting that any comment filed in paper form be sent by courier
or overnight service, if possible, because U.S. postal mail in the
Washington area and at the Commission is subject to delay due to
heightened security precautions.
The FTC Act and other laws the Commission administers permit the
collection of public comments to consider and use in this proceeding as
appropriate. The Commission will consider all timely and responsive
public comments that it receives, whether filed in paper or electronic
form. Comments received will be available to the public on the FTC
Website, to the extent practicable, at (http://www.ftc.gov/os/
publiccomments.shtm). As a matter of discretion, the Commission makes
every effort to remove home contact information for individuals from
the public comments it receives before placing those comments on the
FTC Website. More information, including routine uses permitted by the
Privacy Act, may be found in the FTC's privacy policy, at (http://
www.ftc.gov/ftc/privacy.shtm).
FOR FURTHER INFORMATION CONTACT: Hampton Newsome, (202) 326-2889,
Attorney, Division of Enforcement, Bureau of Consumer Protection,
Federal Trade Commission, 601 New Jersey Avenue, N.W., Washington, DC
20001.
SUPPLEMENTARY INFORMATION:
I. Background
The Commission adopted the Fuel Economy Guide in 1975 to prevent
deceptive fuel economy advertising and to facilitate the use of fuel
economy information in advertising. The Guide helps advertisers avoid
making claims that are unfair or deceptive under Section 5 of the FTC
Act (15 U.S.C. 45(a)).\2\ To accomplish this goal, the Guide contains
specific information about the disclosure of mileage information
generated by EPA's well-established fuel economy program. Under EPA
regulations (40 CFR Part 600), vehicle manufacturers must disclose fuel
economy numbers on labels attached to new automobiles.\3\ In addition,
EPA regulations contain specific testing protocols (see 40 CFR Part 86)
that manufacturers must use to derive the fuel economy information used
on labels.
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\2\ The Commission's industry guides, such as the Fuel Economy
Guide, are administrative interpretations of the application of
Section 5 of the FTC Act, 15 U.S.C. 45(a). The Commission issues
industry guides to provide guidance for the public to conform with
legal requirements. These guides provide the basis for voluntary and
simultaneous abandonment of unlawful practices by members of
industry. 16 CFR Part 17. Failure to follow industry guides may
result in corrective action under Section 5 of the FTC Act. In any
such enforcement action, the Commission must prove that the act or
practice at issue is unfair or deceptive.
\3\ EPA issued its fuel economy labeling regulations pursuant to
the Energy Policy and Conservation Act of 1975 (49 U.S.C. 32901).
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To avoid deceptive or unfair claims in advertisements that contain
fuel economy representations, the Fuel Economy Guide advises marketers
to disclose established fuel economy estimates (e.g., miles per gallon
or ``mpg'') as determined by the mandatory EPA testing protocols (``EPA
tests''). If advertisers make fuel economy claims based on non-EPA
tests, the Guide directs them to disclose EPA-derived fuel economy
information and provide details about the non-EPA tests such as the
source of the test, driving conditions, and vehicle configurations.
In 1978 and again in 1995, the Commission amended the Guide to make
it consistent with changes to EPA's regulations. (43 FR 55757 (Nov. 29,
1978); and 60 FR 56230 (Nov. 8, 1995)). On December 27, 2006 (71 FR
77872), the EPA published new requirements for fuel economy labeling.
The revised EPA rules include modifications to the mandatory fuel
economy test that, among other things, incorporate different driving
conditions (e.g., cold temperatures) into the determination of fuel
mileage estimates. The recent EPA amendments also modify the design of
the fuel economy label and require disclosure of combined (i.e., city
and highway) fuel economy figures in addition to separate city and
highway ratings.
Following EPA's amendments, the Commission published a Federal
Register notice on May 9, 2007 (72 FR 26328) seeking comment on the
overall costs, benefits, necessity, and regulatory and economic impact
of the Guide. The Notice also sought comment on whether the Guide
should be amended in light of EPA's recent rule changes. The Commission
has reviewed the comments received, and now is seeking comment on
proposed amendments to the Guide. This Notice contains an analysis of
the comments received and a description of the proposed amendments
(section II), an invitation for comment on those amendments (section
III), and the proposed language for the amendments (section IV).
II. Analysis of Comments
The Commission received four comments in response to its May 9,
2007 notice.\4\ The comments raised a variety of issues about the
current Guide. Those comments, along with the Commission's responses,
are detailed as follows:
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\4\ Alliance of Automobile Manufacturers (529732-
00005); Association of International Automobile Manufacturers, Inc.
(529732-00008); Broward County Consumer Affairs
(529732-00001) (529732-00002) (529732-
00003) (529732-00004); and National Automobile Dealers
Association (529732-00007).
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A. Benefits of and Need for the Guide
Issue and Comments: In the May 9, 2007 Federal Register notice, the
Commission asked whether there is a continuing need for the Fuel
Economy Guide and whether the Guide is necessary to prevent unfair or
deceptive practices. In response, the comments indicated that the Guide
provides significant benefits to consumers. According to the Alliance
of Automobile Manufacturers (``Alliance''), the Guide ``is an important
industry standard'' that has resulted in informative disclosures to
consumers that are not overly burdensome to
[[Page 19150]]
manufacturers. The Association of International Automobile
Manufacturers, Inc. (``AIAM'') described the Guide as ``an important
industry and consumer resource.'' Similarly, the National Automobile
Dealers Association (``NADA'') wrote that the Guide ``serves to assure
prospective new vehicle purchasers that fuel economy claims
consistently will be advertised in an understandable manner.'' In
NADA's view, the Guide also helps ``ensure that prospective purchasers
receive objective, uniform information, and that manufacturers and
dealers fairly and even-handedly advertise the fuel economy of the new
vehicles they sell.''
The Broward County Consumer Affairs Division (``Broward County''),
a local consumer protection agency in Florida, also supported continued
publication of the Guide. In its view, manufacturers and dealers would
engage in unfair or deceptive trade practices routinely if the Guide
did not exist. Broward County uses the Guide to review fuel economy
advertisements and to bring enforcement actions in its role as a
watchdog over the advertising and sale of new vehicles. Without the
Guide, Broward County believes ``consumers would be at a significant
disadvantage when buying a new car.'' Broward County also noted that
the Guide yields benefits for both consumers and industry by
encouraging consistency in fuel economy advertising, which provides
``stability and equality for the consumer when purchasing a new car.''
In addition, Broward County indicated that, in its view, ``auto dealers
and manufacturers find it easier, more cost effective and less labor
intensive to use the pre-determined EPA estimates.''
While all the comments generally supported the Guide, several noted
the need to update specific provisions. For example, both Alliance and
AIAM urged the Commission to amend the Guide to ensure consistency with
EPA regulations and reflect changes in vehicle technology and fuel use.
AIAM noted, however, that despite the need for conforming changes,
there is no need to alter the basic information in the Guide.
Discussion: The Commission plans to retain the Guide. The comments
received suggest that the Fuel Economy Guide is useful to both
consumers and the new vehicle industry. The Guide encourages clarity in
advertising fuel economy and helps combat unfair or deceptive
practices. While these benefits are difficult to quantify, the comments
suggest that they are significant. At the same time, the comments
indicate that any burdens associated with the Guide are minimal.
Therefore, it appears that there is a continuing need for the Fuel
Economy Guide and that its benefits outweigh any costs it may entail.
In addition, we expect that the Guide's benefits will continue into the
future. Whether due to high gasoline prices or consumer interest in
minimizing energy use for environmental reasons, we expect advertisers
will continue to use fuel economy as a way to distinguish their
vehicles.
In addition to retaining the Guide, we are also proposing several
amendments in response to EPA rule changes and other developments
related to fuel economy advertising. The emergence of new automobile
technology, such as electric hybrid vehicles, underscores the
importance of ensuring that the Guide is applicable to a changing
market. The proposed amendments, as discussed in detail below, should
help ensure the Guide keeps pace with these various changes.
B. Definitions--Section 259.1
Issues, Comments, and Discussion: Several commenters recommended
changes to the Guide's definitions and citations in light of recent
changes to EPA requirements. These various terms and issues are
addressed as follows:
New Automobile: The current Guide defines ``new automobile'' as
``[a]ny passenger automobile or light truck for which a fuel economy
label is required under the Energy Policy and Conservation Act (42
U.S.C. 6201 et seq.) or rules promulgated thereunder, the equitable or
legal title to which has never been transferred by a manufacturer,
distributor, or dealer to an ultimate purchaser.'' The Alliance, NADA,
AIAM, and Broward County all noted that EPA will require a fuel economy
label for medium duty passenger vehicles manufactured during the 2011
model year or thereafter. Accordingly, they suggested that the
Commission amend the Guide's definition of ``new automobile'' to
reflect this upcoming change.
In response to these comments, the Commission proposes to amend the
definition of ``new automobile'' to include the term ``medium duty
passenger vehicle.'' The amended definition, however, would only apply
to vehicles ``for which a fuel economy label is required.''
Accordingly, the Guide would not cover medium duty passenger vehicles
until EPA regulations require labeling for such vehicles in 2011.
Statutory and Regulatory Citations: Both AIAM and the Alliance
recommended that the Commission update the Guide's citation to the
Energy Policy and Conservation Act to 49 U.S.C. 32901. The Alliance
also suggested changes to the Guide's citations to EPA regulations to
reflect the new amendments. To remain current in the future, NADA
recommended that the Commission replace specific cites in the Fuel
Economy Guide with more general references to EPA regulations such as
40 CFR Part 600.
Based on these comments, the Commission proposes to update the
citation to EPCA (i.e., 49 U.S.C. 32901). In addition, we propose to
replace specific regulatory citations with a general reference to EPA
regulations at 40 CFR Part 600. This will reduce the need to amend the
Guide in the future while still providing a useful reference to EPA
regulations.
Fuel Economy: The current Guide uses terms such as ``mpg'' (miles-
per-gallon), ``consumption,'' and ``mileage'' as fuel efficiency
descriptors for vehicles. The Alliance, NADA, and AIAM suggested the
Commission use the term ``fuel economy'' when referring to a vehicle's
fuel efficiency, instead of these other terms because ``fuel economy''
is the ``standard industry term . . . and is readily understood by the
public.'' We agree that the Guide should use the standard industry
terms. Therefore, we propose to amend the Guide to use the term ``fuel
economy'' when describing a vehicle's fuel efficiency. Accordingly, the
proposed amendments use that term in lieu of other descriptors.
Estimated Highway, City, and Combined Fuel Economy: The current
Guide provides information on estimated highway and city fuel economy
but does not provide guidance on combined fuel economy. Both NADA and
Broward County suggested that the FTC amend the Fuel Economy Guide to
address claims for combined fuel economy because such information is
now required on the EPA label. In particular, NADA recommended that the
FTC adopt EPA's definition of that term.\5\ We agree with the comments
that the Guide should include references to ``combined fuel economy.''
Because manufacturers must disclose such information on EPA's fuel
economy label, the Guide should also include the
[[Page 19151]]
term in addressing fuel economy advertising claims. This will ensure
that the scope of the Guide is consistent with the scope of fuel
economy representations required on the EPA label.
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\5\ EPA regulations (40 CFR 600.002-08) define ``combined fuel
economy'' as ``(1) the fuel economy value determined for a vehicle
(or vehicles) by harmonically averaging the city and highway fuel
economy values, weighted 0.55 and 0.45 respectively, (2) for
electric vehicles, the term means the equivalent petroleum-based
fuel economy value as determined by the calculation procedure
promulgated by the Secretary of Energy.''
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Range Claims: In addressing fuel economy range claims, the Guide
uses the terms ``expected range of fuel economy'' and ``range of
estimated fuel economy values for the class of new automobiles.'' This
provision is meant to apply to any claims related to a fuel economy
range and not just claims containing these specific terms. To clarify
this intent, we propose to add the phrase ``or similar language''
following the appearance of the terms ``expected range of fuel
economy'' and ``range of estimated fuel economy values for the class of
new automobiles.''\6\
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\6\ Broward County recommended that the definition of
``estimated in-use fuel economy range'' at Section 259.1(e) include
the EPA-required phrase ``Expected range for most drivers [ ] to [ ]
MPG.'' See 40 CFR 600.307-08(b)(5). We expect that the insertion of
the phrase ``or similar language'' will address that concern.
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Other Minor Changes: We also propose to make the following four,
minor changes to the Guide:
MPG. We propose amending the Guide's definitions for city and highway
fuel economy estimates so that they are consistent with the terms and
definitions used by EPA. For example, we propose to change the term
``estimated city mpg'' to ``estimated city fuel economy,'' the term
used by EPA in its regulations.\7\
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\7\ The proposed definitions for these two terms read:
``Estimated city fuel economy. The city fuel economy determined in
accordance with the city test procedure employed and published by
the U.S. Environmental Protection Agency as described in 40 CFR Part
600 and expressed in miles-per-gallon, to the nearest whole mile-
per-gallon, as measured, reported, published, or accepted by the
U.S. Environmental Protection Agency''; and ``Estimated highway fuel
economy. The highway fuel economy determined in accordance with the
highway test procedure employed and published by the U.S.
Environmental Protection Agency as described in 40 CFR Part 600 and
expressed in miles-per-gallon, to the nearest whole mile-per-gallon,
as measured, reported, published, or accepted by the U.S.
Environmental Protection Agency.''
In-Use. We propose eliminating the words ``in-use'' from the term for
fuel economy range because ``in-use'' is not generally used by EPA and
also may imply that data is generated from actual driving conditions
and not the laboratory tests required by EPA regulations.\8\
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\8\ The proposed definition reads: ``Range of fuel economy. The
range of city, highway, or combined fuel economy of the particular
new automobile on which the label is affixed, as determined in
accordance with procedures employed by the U.S. Environmental
Protection Agency as described in 40 CFR Part 600 and expressed in
miles-per-gallon, to the nearest whole mile-per-gallon, as measured,
reported, or accepted by the U.S. Environment Protection Agency.''
Unique Nameplate. We propose eliminating an obsolete reference to the
term ``unique nameplate'' in footnote 2 of the Guide and replacing it
with the more appropriate EPA term ``model type.''\9\
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\9\ The relevant portion of the proposed footnote language
reads: ``Fuel economy estimates assigned to model types (see 40 CFR
600.208-08(a)(2)), should not be used for other vehicles in a car
line that have different fuel economy ratings. For example, if a
manufacturer has a model named the `XZA' that has fuel economy
estimates assigned to it and a derivative model named the `Econo-
XZA' that has separate, higher fuel economy estimates assigned to
it, these higher numbers assigned to the `Econo-XZA' cannot be used
in advertisements for the `XZA.'''
New Automobile. Embedded within the definition of ``new automobile''
in the current Guide are other definitions for the terms ``dealer,''
``manufacturer,'' and ``ultimate purchaser.'' We propose to amend this
provision by creating separate definitions for these latter three
terms.
C. Non-EPA Estimates--Section 259.2(c)
Issue and Comments: Section 259.2(c) of the Guide addresses fuel
economy claims derived from non-EPA tests. The Guide indicates that
advertisers can make fuel economy claims based on non-EPA information
as long as they: 1) disclose the corresponding EPA estimates with more
prominence than other estimates, 2) identify the source of the non-EPA
information, and 3) disclose how their non-EPA test differs from the
EPA test in terms of driving conditions and other relevant variables.
NADA suggested that the Commission delete Section 259.2(c) because
the ``benefit of being able to advertise non-EPA fuel economy estimates
is outweighed by the need for uniformity, clarity, and fairness.'' In
its view, the FTC should retain this section only if there is evidence
that sellers regularly advertise ``non-EPA fuel economy estimates, and
are expected to conduct similar advertising in the future.'' Broward
County did not suggest that FTC eliminate this section but recommended
changes in light of EPA's recent amendments. In particular, it
recommended the addition of more examples in Section 259.2(c)(3) of the
test conditions and variables that may differ from those covered by the
EPA test, such as high speed/rapid acceleration driving, use of air
conditioning, cold temperature operation, road grade, wind, tire
pressure, load, and the effects of different fuel properties.
Discussion: The Commission proposes retaining the Guide's current
provision related to non-EPA fuel economy claims. We have identified no
basis to prohibit fuel economy advertising claims based on non-EPA
tests. We recognize that many interested parties favor disclosure of
EPA data because it creates a level playing field for industry members
and provides familiar, standardized information for consumers. In
addition, claims based on the non-EPA data have the potential to
mislead consumers if the basis for such claims are not adequately
disclosed. We have no evidence, however, to conclude that such claims
are deceptive in all contexts. Accordingly, the proposed amended Guide
retains the section related to non-EPA tests.
We are not proposing to expand the list of examples related to test
conditions and variables that advertisers may need to disclose when
making fuel economy claims based on non-EPA testing, as suggested by
Broward County. The current Guide is clear that the existing five
examples are not exhaustive. Absent clear evidence of problems with
particular test discrepancies (e.g., tire pressure, road grade), there
appears to be little benefit in adding additional examples to the
list.\10\
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\10\ Footnotes 7 and 8 in the current Guide provide guidance
regarding the relative size and prominence of fuel economy claims
based on non-EPA and EPA estimates in television, radio, and print
advertisements. We propose to add language clarifying that these
footnotes provide examples and do not dictate the only approach in
every context. We recognize that there may be other ways to ensure
that the EPA estimates receive ``more prominence than any other
estimate'' beyond those detailed in these footnotes. The proposed
language also clarifies that the guidance applies to any advertising
medium, not only to television, radio, and print.
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D. Alternative Fueled Vehicles
Issue and Comments: When addressing fuel economy estimates, the
current Guide refers to ``gasoline consumption or mileage of new
automobiles'' (emphasis added). It does not mention other fuel types
such as diesel, electricity, and ethanol. The comments questioned
whether the Guide is unnecessarily limited to advertisements involving
gasoline. The Alliance argued that such a limitation is inappropriate
because many vehicles also run on alternative fuels. NADA explained
that manufacturers are producing new vehicle types such as hybrids
designed to run on electricity, liquid fuel, or a combination of the
two; dedicated alternative fuel vehicles; and dual or flex-fuel
vehicles. NADA recommended that the Guide require disclosure of: 1) all
fuels used by new vehicles; 2) the fuels actually used to
[[Page 19152]]
generate advertised EPA estimates; and 3) any appropriate information
from the Commission's labeling requirements for alternative fuels and
alternative fueled vehicles (16 CFR Part 309). For example, NADA
suggested that advertisements for dual or flex-fuel vehicles indicate
the estimated range for each type of fuel. NADA believes that such
information would ``enable consumers to better compare vehicles using
the same fuel and/or technology and to better compare new technology
and alternative fuel vehicles to their gasoline counterparts.''
Discussion: The Commission proposes to amend the Guide in two
respects related to alternative fuel vehicles. First, we propose to
clarify that the Guide's provisions apply to all fuel types covered by
EPA's current fuel economy labeling program. Second, we propose adding
guidance related to advertising claims for the cruising range of
vehicles run by alternative fuels such as electricity.
First, we agree with commenters that the FTC's guidance should
cover claims related to newer vehicle types and a broader range of fuel
categories to help advertisers avoid making deceptive claims in the
changing automobile market. The amendments, therefore, would remove
references to ``gasoline'' throughout the Guide (e.g., in the
definitions for city and highway fuel economy) and replace them with
references to the term ``fuel.'' The proposed amendments would also add
a definition for ``fuel'' to the Guide that specifically refers to
fuels covered under EPA's current labeling requirements, namely
gasoline, electricity, alcohol, and natural gas.\11\
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\11\ See http://www.fueleconomy.gov/ for a list of currently
available alternative fueled vehicles.
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Second, the Commission proposes to add guidance related to cruising
range information for alternative fueled vehicles, as suggested by
NADA. The FTC's Alternative Fueled Vehicle Rule (16 CFR Part 309)
requires estimated cruising range disclosures on labels for alternative
fuel vehicles such as those powered by electricity, natural gas, and
hydrogen.\12\ For most alternative fueled vehicle types, the Rule also
identifies specific procedures manufacturers must use to calculate
those cruising ranges (e.g., EPA- and FTC-mandated procedures for most
vehicles).\13\ Cruising ranges provide consumers with important
information about the number of miles vehicles will travel between
refueling (e.g., the number of miles an electric vehicle will travel on
a single charge).
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\12\ The FTC's labeling requirements apply to vehicles capable
of operating on methanol (or other alcohols), ethanol at mixtures of
85 percent or more, natural gas, liquefied petroleum gas, hydrogen,
coal-derived liquid fuels, fuels derived from biological materials,
and electricity. See 16 CFR 309.1.
\13\ For most vehicles, the FTC Rule requires the use of EPA
fuel economy data to derive cruising ranges. For electric vehicles,
however, manufacturers must determine cruising ranges using Society
of Automotive Engineers (``SAE'') Surface Vehicle Recommended
Practice SAE J1634--1993--05--20, ``Electric Vehicle Energy
Consumption and Range Test Procedure.'' 16 CFR 309.22(a)(2). For
non-electric vehicles that are not subject to EPA's fuel economy
labeling regulations (40 CFR Part 600) (e.g., certain ethanol
vehicles), the FTC's Alternative Fuel Vehicle Rule requires
manufacturers to have competent and reliable evidence that
substantiates the minimum and maximum number of miles the vehicle
will travel between refueling and recharging. See 16 CFR 309.22.
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Industry trends suggest that advertisements related to cruising
range will increase over the next several years. Recently,
manufacturers have increased their development and marketing of
vehicles that use alternative fuels such as ethanol\14\ and compressed
natural gas. They are also developing a variety of vehicles that use
technologies not previously available on a wide basis, such as plug-in
electric vehicles (``PHEVs''), pure electric vehicles (``EVs''), and
vehicles that use hydrogen fuel cell technology. Given these
developments, advertising claims for cruising range are likely to
become more prevalent.
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\14\ Although EPA's fuel economy labeling requirements currently
do not apply to ethanol, EPA is considering the issue. See 71 FR at
77904-05.
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Though we expect that most advertisers will use the FTC-required
procedures to derive cruising range estimates, some may seek to use
alternative estimates in advertising. Such claims, advertised without
qualification, could harm consumers by confusing or deceiving those who
assume the cruising range estimates appearing in advertisements are the
same as those appearing on the FTC-required vehicle label. To avoid
such problems, the proposed Guide amendments would indicate that
advertisers making such claims should identify the estimate required on
the FTC label, disclose the source of the non-FTC derived cruising
range information, and describe any material differences between the
FTC-mandated and non-FTC procedures.\15\ Because the Commission already
has established similar guidance for analogous claims related to fuel
economy in Section 259.2(c), we have based this new proposed guidance
for alternative fuel vehicle claims on those existing provisions.
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\15\ As part of these proposed changes related to alternative
fueled vehicles, the amendments would also add definitions to
Section 259.1 for ``alternative fueled vehicle'' and ``estimated
cruising range.''
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We invite comments on this proposal. In particular, we seek
information on whether cruising range estimates will become
increasingly prevalent in the future and whether the proposed guidance
is necessary to help prevent deceptive advertising.
E. Model Year
Issue and Comments: The current Fuel Economy Guide does not address
a vehicle's model year. NADA suggested that fuel economy advertisements
should specify the vehicle's model year because EPA's new fuel economy
standards took effect in model year 2008. NADA believes that clear
disclosure of model year is important to allow consumers to make
appropriate comparisons between models labeled with the old test
results and those labeled with the new results.
Response: The Commission is not proposing to change the Guide to
address disclosures related to model year. We understand that the EPA
test procedure amendments yielded fuel economy numbers for all 2008
vehicles that are substantially different from those for 2007 models.
This inconsistency, however, reflected a temporary transition and we
expect that any confusion has diminished as 2007 vehicles have been
sold. Accordingly, any specific guidance on the use of model year
information in advertisements in the Fuel Economy Guide would be
obsolete.\16\
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\16\ We note that nothing prohibits the inclusion of model year
information in an advertisement.
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F. Consumer Education
Issue and Comments: Broward County urged the Commission to increase
its consumer education efforts to ensure that consumers understand the
impact of changes in EPA's test procedures.
Discussion: The Commission currently provides consumers with
information related to fuel and fuel economy through its website at
(http://www.ftc.gov/energy). These resources include information on gas
mileage, questionable ``gas-savings'' products, alternative fueled
vehicles, and octane ratings. We will consider adding additional
consumer education materials as appropriate. As for information about
the new fuel economy estimates, we note that EPA and DOE already
maintain a website http://www.fueleconomy.gov that provides
comprehensive consumer information on the fuel economy issues,
including detailed information on the new fuel economy ratings and
labels
[[Page 19153]]
(http://www.fueleconomy.gov/feg/ratings2008.shtml).
III. Request for Comment and Regulatory Review Program
The Commission solicits written public comments on any aspect of
the proposed amendments to the Fuel Economy Guide announced in this
Notice. We specifically request comments on the following questions:
(1) What costs or burdens, or other impacts, would the proposed
amendments impose, and on whom? What evidence supports the asserted
costs, burdens, or other impacts?
(2) What modifications, if any, should the Commission make to the
proposed amendments to increase their benefits to consumers?
(a) What evidence supports your proposed modifications? Please
submit any such evidence.
(b) How would these modifications affect the costs and benefits of
the proposed amendments for consumers?
(c) How would these modifications affect the costs and benefits of
the proposed requirements for businesses, and in particular, small
businesses?
(3) What modifications, if any, should the Commission make to the
proposed amendments to decrease their burdens on businesses?
(a) What evidence supports your proposed modifications? Please
submit any such evidence.
(b) How would these modifications affect the costs and benefits of
the proposed requirements for consumers?
(c) How would these modifications affect the costs and benefits of
the proposed requirements for businesses, and in particular, small
businesses?
(4) Should the Guide include provisions related to cruising range
claims for alternative fuel vehicles as proposed? Will cruising range
estimates become increasingly prevalent in the future? Is the proposed
guidance necessary to help prevent deceptive advertising related to
such claims?
List of Subjects in 16 CFR Part 259
Advertising, Fuel economy, Trade practices.
For the reasons set forth in the preamble, the Commission proposes
to amend 16 CFR Part 259 as follows:
PART 259--GUIDE CONCERNING FUEL ECONOMY ADVERTISING FOR NEW
AUTOMOBILES
1. The authority citation for part 259 continues to read as
follows:
Authority: 15 U.S.C. 41--58.
2. Section 259.1 is revised to read as follows:
Sec. 259.1 Definitions.
For the purposes of this part, the following definitions shall
apply:
(a) Alternative fueled vehicle. Any vehicle that qualifies as a
covered vehicle under 16 CFR Part 309.
(b) Dealer. Any person located in the United States or any
territory thereof engaged in the sale or distribution of new
automobiles to the ultimate purchaser.
(c) Estimated city fuel economy. The city fuel economy determined
in accordance with the city test procedure employed and published by
the U.S. Environmental Protection Agency as described in 40 CFR Part
600 and expressed in miles-per-gallon, to the nearest whole mile-per-
gallon, as measured, reported, published, or accepted by the U.S.
Environmental Protection Agency.
(d) Estimated combined fuel economy. The combined fuel economy
value determined for a vehicle (or vehicles) in accordance with U.S.
Environmental Protection Agency regulations described in 40 CFR Part
600 and expressed in miles-per-gallon, to the nearest whole mile-per-
gallon, as measured, reported, published, or accepted by the U.S.
Environmental Protection Agency.
(e) Estimated cruising range. An estimate of the number of miles an
alternative fueled vehicle will travel between refueling as defined and
determined pursuant to 16 CFR Part 309.
(f) Estimated highway fuel economy. The highway fuel economy
determined in accordance with the highway test procedure employed and
published by the U.S. Environmental Protection Agency as described in
40 CFR Part 600 and expressed in miles-per-gallon, to the nearest whole
mile-per-gallon, as measured, reported, published, or accepted by the
U.S. Environmental Protection Agency.
(g) Fuel.
(1) Gasoline and diesel fuel for gasoline- or diesel-powered
automobiles; or
(2) Electrical energy for electrically powered automobiles; or
(3) Alcohol for alcohol-powered automobiles; or
(4) Natural gas for natural gas-powered automobiles.
(h) Fuel economy. (1) The average number of miles traveled by an
automobile or group of automobiles per volume of fuel consumed as
calculated in this part; or
(2) The equivalent petroleum-based fuel economy for an electrically
powered automobile as determined by the Secretary of Energy.
(i) Manufacturer. Any person engaged in the manufacturing or
assembling of new automobiles, including any person importing new
automobiles for resale and any person who acts for and is under the
control of such manufacturer, assembler, or importer in connection with
the distribution of new automobiles.
(j) New automobile. Any passenger automobile, medium duty passenger
vehicle, or light truck for which a fuel economy label is required
under the Energy Policy and Conservation Act (42 U.S.C. 32901 et seq.)
or rules promulgated thereunder, the equitable or legal title to which
has never been transferred by a manufacturer, distributor, or dealer to
an ultimate purchaser.
(k) Range of fuel economy. The range of city, highway, or combined
fuel economy of the particular new automobile on which the label is
affixed, as determined in accordance with procedures employed by the
U.S. Environmental Protection Agency as described in 40 CFR Part 600,
and expressed in miles-per-gallon, to the nearest whole mile-per-
gallon, as measured, reported, or accepted by the U.S. Environmental
Protection Agency.
(l) Ultimate purchaser. The first person, other than a dealer
purchasing in his or her capacity as a dealer, who in good faith
purchases a new automobile for purposes other than resale, including a
person who leases such vehicle for his or her personal use.
(m) Vehicle configuration. The unique combination of automobile
features, as defined in 40 CFR Part 600.
3. Section 259.2 is revised to read as follows:
Sec. 259.2 Advertising disclosures.
(a) No manufacturer or dealer shall make any express or implied
representation in advertising concerning the fuel economy of any new
automobile\1\ unless such representation is accompanied by the
following clear and conspicuous disclosures:
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\1\ The Commission will regard as an express or implied fuel
economy representation one which a reasonable consumer, upon
considering the representation in the context of the entire
advertisement, would understand as referring to the fuel economy of
the vehicle or vehicles advertised.
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(1) If the advertisement makes:
(i) Representations about city, highway, and combined fuel economy,
or any combination of the three, the advertisement must disclose the
applicable estimated fuel economy information for each type of fuel
[[Page 19154]]
economy represented in the advertisement;\2\
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\2\ For purposes of Sec. 259.2(a), the ``city fuel economy,''
the ``highway fuel economy,'' and the ``combined fuel economy'' must
be those applicable to the specific model type being advertised.
Fuel economy estimates assigned to model types (see 40 CFR 600.208-
08(a)(2)), should not be used for other vehicles in a car line that
have different fuel economy ratings. For example, if a manufacturer
has a model named the ``XZA'' that has fuel economy estimates
assigned to it and a derivative model named the ``Econo-XZA'' that
has separate, higher fuel economy estimates assigned to it, these
higher numbers assigned to the ``Econo-XZA'' cannot be used in
advertisements for the ``XZA.''
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(ii) A representation regarding only city, only highway, or only
combined fuel economy, the corresponding EPA fuel economy estimate must
be disclosed;\3\
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\3\ For example, if the representation clearly refers only to
highway fuel economy, only the ``estimated highway fuel economy''
need be disclosed.
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(iii) A general fuel economy claim without reference to any
estimated fuel economy determined pursuant to EPA requirements, the
estimated city fuel economy must be disclosed.\4\
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\4\ Nothing in this section should be construed as prohibiting
disclosure of both the city and highway estimates.
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(2) That the U.S. Environmental Protection Agency is the source of
the estimated ``city fuel economy,'' ``highway fuel economy,'' and
``combined fuel economy,'' and that the numbers are estimates.\5\
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\5\ The Commission will regard the following as the minimum
disclosure necessary to comply with Sec. 259.2(a)(2), regardless of
the media in which the advertisement appears:
``EPA estimate(s).'' For video, if the estimated mpg appears in
the visual, the disclosure must appear visually; if the estimated
mpg is audio, the disclosure must be audio.
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(b) If an advertisement for a new automobile cites:
(1) The ``expected range of fuel economy'' or similar language, the
advertisement must state with equal prominence both the upper and lower
number of the range, an explanation of the meaning of the numbers
(i.e., city fuel economy range or highway fuel economy range or
combined fuel economy range or any combination of the three), and that
the U.S. Environmental Protection Agency is the source of the figures.
(2) The ``range of estimated fuel economy values for the class of
new automobiles'' or similar language as a basis for comparing the fuel
economy of two or more automobiles, such comparison must be made to the
same type of range (i.e., city, highway, or combined).\6\
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\6\ For example, an advertisement could not promote a vehicle's
fuel economy by comparing the vehicle's estimated highway fuel
economy to the city estimates of other vehicles in its class.
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(c) Fuel economy estimates derived from a non-EPA test may be
disclosed provided that:
(1) The advertisement also discloses the ``estimated city fuel
economy,'' the ``estimated highway fuel economy,'' and/or the
``estimated combined fuel economy'' as required by Sec. 259.2(a), and
the disclosure required by Sec. 259.2(a), and gives the ``estimated
city fuel economy,'' the ``estimated highway fuel economy,'' and/or the
``estimated combined fuel economy'' figure(s) substantially more
prominence than any other estimate;\7\ provided, however, for any
advertising medium in which any other estimate is used in the audio,
equal prominence must be given the ``city fuel economy,'' the ``highway
fuel economy,'' and/or the ``combined fuel economy'' figure(s);\8\
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\7\ For example, the Commission regards the following as
constituting ``substantially more prominence:''
For video: If the estimate derived from the non-EPA test appears
in the visual portion, the estimated city, highway, and/or combined
mpg should appear in numbers twice as large as those used for any
other estimate, and remain on the screen at least as long as any
other estimate. Alternatively, if the estimate derived from the non-
EPA test appears in the visual portion, the estimated city, highway,
and/or combined mpg should (1) appear simultaneously and with at
least equal prominence as the other mileage estimate(s) in the
visual portion, and (2) be stated in the audio portion. Each visual
estimated city, highway, and/or combined mpg should be broadcast
against a solid color background that contrasts easily with the
color used for the numbers.
For print: The estimated city, highway, and/or combined mpg
should appear in clearly legible type at least twice as large as
that used for any other estimate or in type of the same size as such
other estimate, if it is clearly legible and conspicuously circled.
The estimated city, highway, and/or combined mpg should appear
against a solid color, contrasting background. They should not
appear in a footnote unless all references to fuel economy appear in
a footnote.
\8\ For example, the Commission regards the following as
constituting equal prominence: The estimated city, highway, and/or
combined mpg should be stated, either before or after each
disclosure of such other estimate at least as audibly as such other
estimate.
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(2) The source of the non-EPA test is clearly and conspicuously
identified;
(3) The driving conditions and variables simulated by the test
which differ from those used to measure the ``estimated city fuel
economy,'' the ``estimated highway fuel economy,'' and/or the
``estimated combined fuel economy'' and which result in a change in
fuel economy, are clearly and conspicuously disclosed;\9\ and
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\9\ For dynamometer tests any difference between the EPA and
non-EPA tests must be disclosed. For in-use tests, the Commission
realizes that it is impossible to duplicate the EPA test conditions,
and that in-use tests may be designed to simulate a particular
driving situation. It must be clear from the context of the
advertisement what driving situation is being simulated (e.g., cold
weather driving, highway driving, and heavy load conditions).
Furthermore, any driving or vehicle condition must be disclosed if
it is significantly different from that which an appreciable number
of consumers (whose driving condition is being simulated) would
expect to encounter.
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(4) The advertisement clearly and conspicuously discloses any
distinctions in ``vehicle configuration'' and other equipment affecting
mileage performance (e.g., design or equipment differences which
distinguish subconfigurations as defined by EPA) between the
automobiles tested in the non-EPA test and the EPA tests.
(d) If an advertisement contains an estimated cruising range for an
alternative fueled vehicle that is not determined in accordance with
FTC's Labeling Requirements for Alternative Fuels and Alternative
Fueled Vehicles (16 CFR Part 309), the advertisement must disclose
clearly and conspicuously:
(1) The estimated cruising range required on the FTC label (16 CFR
Part 309) with substantially more prominence than any other estimate;
provided, however, for any advertising medium in which any other
estimate is used only in the audio, equal prominence must be given the
estimated cruising range that is required on the FTC label;\10\
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\10\ See footnotes 7 and 8 for guidance on prominence.
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(2) The source of the cruising range estimate; and
(3) Any material differences between the method used and the method
required by the FTC's labeling requirements at 16 CFR 309.22.
By direction of the Commission.
Donald S. Clark,
Secretary.
[FR Doc. E9-9649 Filed 4-27-09: 8:45 am]
BILLING CODE 6750-01-S