SEMA News—August 2021

LEGISLATIVE AND TECHNICAL AFFAIRS

Fighting Against Regulatory Overreach

By Caroline Fletcher

Most people involved in the automotive industry have heard of the RPM Act, SEMA’s federal legislation to ensure that street vehicles can be modified into dedicated race cars. However, many people aren’t aware that SEMA works to influence regulatory agencies as well as the legislative process.

While not as flashy as introducing a bill in Congress, much of SEMA’s advocacy efforts are on the regulatory front—protecting members and enthusiasts from bureaucratic overreach. Regulatory agencies frequently issue proposed rulemakings, and they have authority over a broad range of issues that could impact SEMA members. SEMA staff monitor the Federal Register (where federal rulemakings are published daily) to make sure that the automotive aftermarket’s concerns are taken into consideration before the rulemakings are finalized.

In the last few months alone, SEMA has submitted comments to the U.S. Environmental Protection Agency (EPA), the National Highway Traffic Safety Administration (NHTSA), the Patent and Trade Office (PTO), and the California Energy Commission (CEC) on topics of importance to the specialty auto parts market, ranging from cybersecurity and ethanol-blended gasoline labels to tire standards.

Cybersecurity is an issue of growing concern for many industries, including the automotive aftermarket. SEMA submitted comments to NHTSA on its updated document, “Cybersecurity Best Practices for the Safety of Modern Vehicles.” SEMA is supportive of cybersecurity best practices for vehicles that maintain the legal right of vehicle owners to access data, hardware, and software in order to repair or modify their vehicles.

In its comments, SEMA cited the recent Massachusetts right-to-repair ballot initiative that passed in 2020, emphasizing consumers’ desire to legally modify and repair their vehicles how they see fit. SEMA recommended that the best practices document’s reference to “vehicle modification” be expanded to confirm the consumer’s right to modify their vehicles in addition to having them serviced. SEMA also recommended that NHTSA clarify that the document applies to all types of aftermarket parts, not just the referenced mobile phones or other digital devices.

Other issues of increasing interest for the automotive aftermarket are advance driver-assistance systems (ADAS) and automated driving systems (ADS). While NHTSA was focused on developing a framework for ADS safety, SEMA noted that automated driving relies on ADAS technology (cameras, radar, LIDAR, etc.) for features such as advanced braking and lane departure, so the two issues are commingled.

Within that context, SEMA’s comments focused on information availability to the automotive aftermarket in the coming years to ensure that vehicles can be independently serviced, repaired and modified as new ADS/ADAS-related technologies emerge. As the agency works with industry stakeholders to create a regulatory overlay for both topics, SEMA took the opportunity to proactively focus attention on the issue.

In comments to the EPA on its proposed rulemaking on E15 gas pump labels, SEMA pushed back on the EPA’s proposal to limit or remove the labeling requirement. Ethanol—especially in higher concentrations such as E15—can cause metal corrosion and dissolve certain plastics and rubbers in older automobiles that were not constructed with ethanol-resistant materials, or in certain specialty high-performance equipment.

SEMA expressed dismay that the EPA would suggest making the current label smaller in size and soften the warning language—or rescind the warning label altogether—since there are still millions of older vehicles and non-road vehicles for which ethanol poses a threat. SEMA argued that the label needs to be larger and have a stronger warning to prevent misfuelling.

Protecting SEMA members’ intellectual property rights and combatting counterfeit product sales is a top priority. SEMA submitted comments to the PTO in support of its proposal to develop a national consumer awareness campaign on combatting trafficking in counterfeit and pirated products. For example, current major sources of counterfeit products are internet consumer purchases that arrive in the United States via postal and overnight carriers rather than container ships.

SEMA noted that it is working with lawmakers, regulators, and industry partners to combat the problem. SEMA is a part of the National Association of Manufacturers’ anti-counterfeiting task force, which is seeking to enact legislation that would require e-commerce platforms to provide basic information about their identity and location and to compel the platforms to exert oversight over their sellers.

While this article focuses on federal issues, SEMA also monitors and advocates on behalf of the industry before state-level regulatory bodies. Most recently, SEMA provided comments on the replacement tire efficiency program being pursued by the CEC. SEMA worked with California lawmakers in 2003 to limit the scope of the Replacement Tire Efficiency Program (AB 844), which largely applies to mass-produced passenger and light-duty truck tires.

Lawmakers provided an exemption from the program to five categories of tires, including tires with the same SKU, plant and year in volumes of 15,000 or less annually, along with several other categories. The exemptions apply to most specialty tires marketed by SEMA members.

In its comments, SEMA reinforced the idea that the program is a consumer awareness initiative and not a mechanism for removing consumer choice. SEMA also reminded regulators that consumers may desire to emphasize tire characteristics other than fuel efficiency for their driving needs when selecting a replacement tire, such as wet traction, handling or mileage.

While federal and state regulations aren’t a subject many people find riveting, bureaucrats sitting in office buildings in Washington, D.C., and in state capitals around the country can have enormous impact on issues relevant to the automotive aftermarket. Those positions usually aren’t elected but appointed, so they lack the level of accountability that can keep elected officials in check. However, SEMA members can rest easy knowing that their industry is being looked out for from incoming threats from regulatory agencies.