[Federal Register Volume 89, Number 34 (Tuesday, February 20, 2024)]
[Rules and Regulations]
[Pages 12749-12756]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-03119]


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DEPARTMENT OF TRANSPORTATION

National Highway Traffic Safety Administration

49 CFR Part 531

[NHTSA-2022-0048]
RIN 2127-AM29


Exemptions From Average Fuel Economy Standards; Passenger 
Automobile Average Fuel Economy Standards

AGENCY: National Highway Traffic Safety Administration (NHTSA), 
Department of Transportation (DOT).

ACTION: Final rule; final decision to grant exemption.

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SUMMARY: This final decision responds to petitions filed by several low 
volume manufacturers requesting exemption from the generally applicable 
corporate average fuel economy (CAFE) standards for several model years 
(MYs). The low volume manufacturers and MYs are as follows: Aston 
Martin Lagonda Limited for MYs 2008-2023, Ferrari N.V. for MYs 2016-
2018 and 2020, Koenigsegg Automotive AB for MYs 2015 and 2018-2023, 
McLaren Automotive for MYs 2012-2023, Mobility Ventures LLC for MYs 
2014-2016, Pagani Automobili S.p.A for MYs 2014 and 2016-2023, and 
Spyker Automobielen B.V. for MYs 2008-2010. NHTSA is exempting these 
manufacturers from the generally applicable CAFE standards for the 
model years listed and establishing alternative standards for each 
manufacturer at the levels stated below, which the agency has 
determined to be maximum feasible for each of those manufacturers for 
the model years in question.

DATES: This rule is effective March 21, 2024.

ADDRESSES: For access to the dockets to read background documents or 
comments received, go to https://www.regulations.gov, and/or: Docket 
Management Facility, M-30, U.S. Department of Transportation, West 
Building, Ground Floor, Rm. W12-140, 1200 New Jersey Avenue SE, 
Washington, DC 20590. The Docket Management Facility is open between 9 
a.m. and 4 p.m. Eastern Time, Monday through Friday, except on Federal 
holidays.

FOR FURTHER INFORMATION CONTACT: Joseph Bayer, Chief of Fuel Economy 
Division, Office of Rulemaking, by phone at (202) 366-9540 or by fax at 
(202) 493-2290 or Hannah Fish, Attorney Advisor, Vehicle Standards and 
Harmonization, Office of the Chief Counsel, by phone at (202) 366-2992 
or by fax at (202) 366-3820.

SUPPLEMENTARY INFORMATION: 

Table of Contents

1. Introduction
2. Summary of Proposed Rule
3. Summary and Response to Comments Received on the Proposal
4. Maximum Feasible Average Fuel Economy for Exempted Manufacturers
5. Regulatory Impact Analyses
    a. Regulatory Evaluation
    b. Regulatory Flexibility Determination
    c. National Environmental Policy Act
Regulatory Text

1. Introduction

    The Energy Policy and Conservation Act (EPCA) of 1975, as amended 
by the Energy Independence and Security Act (EISA) of 2007,\1\ directs 
the Secretary of Transportation, and the National Highway Traffic 
Safety Administration (NHTSA) by delegation,\2\ to prescribe corporate 
average fuel economy (CAFE) standards for automobiles manufactured in 
each model year (MY). EPCA/EISA requires NHTSA to establish CAFE 
standards for passenger cars and light trucks at the ``maximum feasible 
average fuel economy level'' that it decides manufacturers can achieve 
in a MY,\3\ based on the agency's consideration of four factors: 
technological feasibility, economic practicability, the effect of other 
standards of the Government on fuel economy, and the need of the United 
States to conserve energy.\4\
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    \1\ 49 U.S.C. 32901 et seq.
    \2\ 49 CFR 1.95.
    \3\ 49 U.S.C. 32902(a).
    \4\ 49 U.S.C. 32902(f).
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    Congress provided in EPCA/EISA statutory authority for NHTSA to 
exempt a low volume manufacturer of passenger automobiles from the 
industry-wide passenger car standard if NHTSA concludes that the 
industry-wide passenger car standard is more stringent than the maximum 
feasible average fuel economy level that the manufacturer can achieve, 
and NHTSA establishes an alternative standard for that manufacturer's 
fleet of passenger cars at the maximum feasible average fuel economy 
level that the manufacturer can achieve.\5\ Under EPCA/EISA, a low 
volume manufacturer is one that manufactured (whether in the United 
States or not) fewer than 10,000 passenger automobiles in the MY two 
years before the MY for which the exemption is sought, and that will 
manufacture fewer than 10,000

[[Page 12750]]

passenger automobiles in the affected MY. NHTSA may set alternative 
fuel economy standards in three ways: (1) a separate standard for each 
exempted manufacturer; (2) a separate standard applicable to each class 
of exempted automobiles (classes based on design, size, price, or other 
factors); or (3) a single standard for all exempted manufacturers.\6\ 
NHTSA has historically set individual standards for each exempted 
manufacturer.
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    \5\ 49 U.S.C. 32902(d). NHTSA notes that there is no statutory 
provision allowing exemptions from the light truck standards 
established in 49 CFR part 533.
    \6\ 49 U.S.C. 32902(d)(2).
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    49 CFR part 525 contains NHTSA's regulations implementing the 
requirements in 49 U.S.C. 32902. This part provides content and format 
requirements for low volume manufacturer petitions for exemption and 
specifies that those petitions must be submitted to NHTSA not later 
than 24 months before the beginning of the affected model year unless 
good cause for later submission is shown.\7\ As discussed further 
below, manufacturers must include several data elements in their 
petitions, including among other things projected vehicle production 
mix, vehicle features for each vehicle configuration, projected average 
fuel economy figures for each production mix, and technological means 
for improving the fuel economy of the manufacturer's vehicles.\8\ Part 
525 also outlines the NHTSA process for publishing proposed and final 
decisions on petitions in the Federal Register and for accepting public 
input on proposed decisions.\9\ A manufacturer's final alternative 
standard is codified at 49 CFR part 531.
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    \7\ 49 CFR 525.6(b). See also 54 FR 40689 (Oct. 3, 1989). NHTSA 
has identified two broad categories of situations that would 
establish good cause for failure to submit a timely petition: 
situations in which necessary supporting data for the petition were 
unavailable until after the due date had passed (for example, a 
recently incorporated manufacturer might not have adequate time to 
file an exemption petition 24 months prior to the model year), and 
second, situations in which a legitimately unexpected noncompliance 
occurs (for example, if a company providing a low volume 
manufacturer with its engines goes out of business, and the 
manufacturer is forced to make an unanticipated engine switch, 
resulting in lower than expected fuel economy). That said, each 
determination that good cause was or was not shown for the late 
filing is made on an individual basis. Manufacturers should reach 
out to NHTSA as expeditiously as possible if they expect they cannot 
submit a petition in a timely manner.
    \8\ 49 CFR 525.7.
    \9\ 49 CFR 525.8.
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    This final decision responds to petitions filed by Aston Martin 
Lagonda Limited (AML) for MYs 2008-2023, Ferrari N.V. (Ferrari) for MYs 
2016-2018 and 2020, Koenigsegg Automotive AB (Koenigsegg) for MYs 2015 
and 2018-2023, McLaren Automotive (McLaren) for MYs 2012-2023, Mobility 
Ventures LLC (Mobility Ventures) for MYs 2014-2016, Pagani Automobili 
S.p.A (Pagani) for MYs 2014 and 2016-2023,\10\ and Spyker Automobielen 
B.V. (Spyker) for MYs 2008-2010. NHTSA concludes that all seven 
manufacturers were, and are, eligible for an alternative standard for 
the listed model years and that the industry-wide passenger car CAFE 
standard for those model years is more stringent than the maximum 
feasible average fuel economy level that those manufacturers could, and 
can, achieve. Alternative standards for each manufacturer will be set 
at the levels discussed below.
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    \10\ Pagani petitioned for alternative standards for MYs 2012-
2021 but did not produce any vehicles for sale in the U.S. market in 
MYs 2012, 2013, and 2015.
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2. Summary of the Proposed Decision

    NHTSA published a proposed decision on July 1, 2022 (87 FR 39439) 
that proposed to exempt several low volume manufacturers from the 
generally applicable CAFE standards for several model years. Some of 
these model years had already passed, meaning that any NHTSA action 
prescribing alternative standards for past model years would be 
retroactive. NHTSA recognized that an agency's ability to prescribe 
retroactive rules is very limited; however, NHTSA concluded that based 
on a history of previously granting low volume exemption petitions when 
the agency did not publish proposed and final determinations on those 
exemption petitions before the beginning of a model year,\11\ and the 
limited circumstances in this case, retroactively publishing 
alternative low volume CAFE standards was appropriate.
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    \11\ See, e.g., 43 FR 33268 (July 31, 1978); 49 FR 11548 (March 
1, 1979); 46 FR 29944 (June 4, 1981); 54 FR 40689 (October 3, 1989); 
55 FR 12485 (April 4, 1990).
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    NHTSA also detailed the agency's approach to evaluating exemption 
petitions for model years that had already passed. NHTSA concluded that 
in addition to evaluating the manufacturer's exemption petitions for 
past model years, it was appropriate to evaluate the manufacturer's 
actual CAFE values if NHTSA had those values (either from EPA-verified 
data or from preliminary data submitted by the manufacturer). For 
imminently future model years, NHTSA evaluated whether the alternative 
standard for which the manufacturer petitioned was maximum feasible, 
and if not, what, if any, technologically feasible and economically 
practicable changes the manufacturer could make in the time frame 
before model year production would need to commence. NHTSA looked to 
the regulations implementing EPCA's low volume manufacturer exemption 
provisions, which required low volume manufacturers to submit petitions 
for exemption ``not later than 24 months before the beginning of the 
affected model year,'' as a guidepost for determining whether a low 
volume manufacturer could potentially make any additional changes to 
its vehicles.
    All low volume manufacturers considered in the proposed decision 
met the threshold statutory requirements for eligibility; that is, all 
manufacturers manufactured or will manufacture fewer than 10,000 
vehicles in the applicable model years. Some petitions for some model 
years were submitted late, although the late filings were accompanied 
by good cause claims, per 49 CFR part 525.\12\ Regardless of the 
sufficiency of those good cause claims, NHTSA stated that due to the 
significant lateness of the agency's response to these specific 
exemption requests, it would be inequitable at this point to deny the 
late petitions on grounds of untimeliness. Moving forward, NHTSA 
expects manufacturers to remain cognizant of the requirement that each 
submission must be submitted not later than 24 months before the 
beginning of the affected model year unless good cause for later 
submission is shown.
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    \12\ 49 CFR 525.6 (``Each petition filed under this part must . 
. . Be submitted not later than 24 months before the beginning of 
the affected model year, unless good cause for later submission is 
shown.'').
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    When proposing maximum feasible average fuel economy levels, NHTSA 
must consider four factors: technological feasibility, economic 
practicability, the effect of other motor vehicle standards of the 
Government on fuel economy, and the need of the United States to 
conserve energy. NHTSA detailed in the proposed rule how the agency's 
consideration of these factors with low volume manufacturers differs 
from consideration of these factors for full-line manufacturers, and 
also how consideration of these factors as applied to past model years 
differs from consideration for future model years.
    Per NHTSA's regulations at 49 CFR 525.7, NHTSA evaluated several 
pieces of information in each manufacturer's petition to assist the 
agency in assessing technologically feasible and economically 
practicable improvements for the manufacturer's fleet. This information 
included a description of the technological means selected by the 
manufacturer for improving the average fuel economy of its automobiles 
to be

[[Page 12751]]

manufactured in a model year, a chronological description of the 
manufacturer's past and planned efforts to implement the fuel-economy-
improving technology in its fleet, a discussion of the alternative and 
additional means considered but not selected by the manufacturer that 
would have enabled its passenger automobiles to achieve a higher 
average fuel economy than is achievable with the means it described, 
and in the case of a manufacturer that planned to increase the average 
fuel economy of its passenger automobiles to be manufactured in either 
of the two model years immediately following the first affected model 
year, an explanation of the reasons for not making those increases in 
the affected model year.
    To evaluate the potential effect of alternative CAFE standards on 
the need of the United States to conserve energy, NHTSA described two 
historical approaches. For several years, the agency categorically 
concluded that if it had already determined that it would not be 
technologically feasible or economically practicable for the low volume 
manufacturer to achieve a higher fuel economy standard than requested, 
denying the exemption or setting a higher alternative standard would 
not have had any effect on the need of the United States to conserve 
energy.\13\ In later years the agency attempted to quantify that de 
minimis impact for illustrative purposes, by estimating the amount of 
additional fuel consumed by the exempted fleet over its operating 
lifetime.\14\ The July 2022 proposed decision quantified the estimated 
additional fuel consumed by the exempted fleet in accordance with the 
second approach, using a combination of estimated and achieved fleet 
fuel economy values, and an updated data-based estimate of yearly low 
volume vehicle miles travelled (VMT) for some categories of low volume 
vehicles.\15\ NHTSA sought comment on that approach and requested any 
other data or information on the driving patterns and mileage schedules 
of another category of low volume vehicles--vehicles used to transport 
wheelchair-bound or otherwise mobility-impaired individuals. NHTSA 
estimated that the additional fuel consumed by the entire low volume 
fleet considered in the proposed decision at the proposed alternative 
standards level equaled 39,769,449 additional gallons of gasoline or 
0.001877% of total U.S. motor vehicle fuel consumption over the 
vehicles' lifetimes.
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    \13\ See, e.g., 54 FR 40689 (Oct. 3, 1989).
    \14\ See, e.g., 61 FR 46756 (Sep. 5, 1996), 71 FR 49407 (Aug. 
23, 2006). In brief, the estimated amount of additional fuel 
consumed by the exempted fleet over its operating lifetime is a 
function of the difference between the manufacturer's actual CAFE 
standard and their requested alternative standard multiplied by the 
manufacturer's estimated U.S. production volume, multiplied then by 
an estimate of the total miles these vehicles could travel as an 
active part of the fleet. The resulting difference is then divided 
by the average number of gallons that the total U.S. automotive 
fleet uses. The final value shows the fleet's additional gallons of 
fuel use as a percentage of total U.S. automotive fuel use.
    \15\ Historically, low volume manufacturer petitions for 
exemption from CAFE standards have covered luxury vehicles, exotic 
high-performance vehicles, and vehicles exclusively designed to be 
used for transporting the wheelchair-bound or other mobility-
impaired individuals.
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    To evaluate the effect of ``other motor vehicle standards of the 
Government'' on fuel economy, NHTSA examined the agency's safety 
standards as well as EPA's emissions standards, which include criteria 
pollutant and greenhouse gas (GHG, which include CO<INF>2</INF>, 
N<INF>2</INF>O, CH<INF>4</INF>, and hydrofluorocarbons) emissions 
standards.
    NHTSA recognized that three manufacturers considered in the July 
2022 proposal (Aston Martin, Ferrari, and McLaren) had received an 
alternative low volume GHG standard under the EPA small volume program 
for vehicles manufactured in MYs 2017-2021.\16\ NHTSA explained that 
the agencies' (NHTSA's and EPA's) respective statutory authorities and 
regulations required a slightly different approach to examining these 
manufacturers' petitions for alternative standards and provided a 
comparison of differences between EPA's final small volume standards 
and NHTSA's proposed alternative standards. NHTSA sought comment on any 
new information the agency should consider on the impact of EPA's GHG 
standards on a manufacturer's ability to meet an alternative fuel 
economy standard.
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    \16\ 85 FR 39561 (July 1, 2020).
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    Several manufacturers cited various Federal Motor Vehicle Safety 
Standards (FMVSS) that could impact their CAFE values, including FMVSS 
No. 214, Side Impact Protection, FMVSS No. 216, Roof Crush Resistance, 
FMVSS No. 226, Occupant Ejection Mitigation, FMVSS No. 301, Fuel System 
Integrity, FMVSS No. 111, Rear Visibility (concerning rearview 
mirrors), and the Pedestrian Protection requirements as proposed in the 
UN ECE Global Technical Regulation (GTR) No. 9. Broadly, manufacturers 
stated that these safety standards could have potentially adverse 
impacts on vehicles' achieved fuel economy levels because of additional 
vehicle weight required, and because they reduce potential aerodynamic 
improvements. Manufacturers also cited EPA and California non-GHG 
emissions standards as requirements that would demand additional 
balancing of priorities.
    Using an analysis of estimates from prior CAFE standards rules,\17\ 
NHTSA concluded that the small increase in weight from the FMVSSs 
(approximately 32 pounds, which was likely already incorporated in the 
vehicle) would have negligible effects on any vehicle considered in the 
proposed decision. NHTSA also concluded that a manufacturer's 
compliance with EPA's criteria pollutant emissions standards would have 
a negligible effect on the manufacturer's maximum feasible fuel economy 
level, based on EPA's specific consideration of its criteria pollutant 
emissions programs on small volume manufacturers.\18\
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    \17\ Final Regulatory Impact Analysis, Corporate Average Fuel 
Economy for MY 2017-MY 2025 Passenger Cars and Light Trucks, Table 
IV-3a (August 2012).
    \18\ 79 FR 23534 (April 28, 2014).
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    Accordingly, NHTSA had proposed alternative standards as follows: 
For MYs 2018 and prior, NHTSA proposed to use a combination of final 
fuel economy values received from EPA and some non-final fuel economy 
values received from manufacturers. NHTSA stated its belief that all 
manufacturers covered by the proposed decision submitted information 
sufficient for the agency to conclude that their achieved fuel economy 
levels for past model years were the maximum feasible fuel economy 
levels that they could have achieved for those model years.
    For MYs 2019-2023, the proposed alternative standards considered 
both confidential business information (CBI) and non-CBI information 
submitted to the agency, including the manufacturer's requested 
alternative standard and predicted achieved fleet fuel economy value 
(if that value differed from the requested alternative standard). For 
imminently future model years (i.e., MYs 2022 and 2023), NHTSA proposed 
standards that did not backslide (i.e., that did not decrease from MY 
2022 to 2023).
    NHTSA tentatively concluded that the proposed fuel economy levels 
appropriately balanced the CAFE exemption program with EPCA's directive 
to conserve energy and that standards that did not backslide for 
imminently future model years were maximum feasible.
    NHTSA sought comment on the analysis that led the agency to propose

[[Page 12752]]

those alternative standards. In addition, NHTSA stated that the agency 
would consider any additional information submitted by commenters, 
manufacturers (if additional information became available), or EPA (if 
additional final fuel economy data became available) submitted during 
the pendency of the comment period associated with the proposal.

3. Summary and Response to Comments Received on the Proposal

    NHTSA received four comments to the proposal. One individual 
commenter opposed the proposed exemption, believing that the exemption 
should not apply to expensive vehicles.\19\ Another individual 
commenter broadly opposed the CAFE program based on, among other 
things, general opposition to climate science.\20\
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    \19\ NHTSA-2022-0048-0005.
    \20\ NHTSA-2022-0048-0007.
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    The Alliance for Automotive Innovation (Auto Innovators) agreed 
with NHTSA's proposed approach to alternative standards through MY 
2023. Auto Innovators stated that manufacturers affected by the 
proposal for past model year standards ``have no ability to change the 
technologies installed on their vehicles, to alter U.S.-directed 
production, or to otherwise achieve compliance with the CAFE regulation 
other than through the purchase of credits from other manufacturers or 
the payment of civil penalties.'' \21\ Auto Innovators also stated that 
MY 2022 production will likely soon be ending, and there is little or 
no opportunity to change designs for MY 2023 production.\22\ Auto 
Innovators urged NHTSA to propose future alternative standards at least 
18 months before the affected model year, as ``low-volume manufacturers 
require similar or even more lead-time as larger manufacturers to 
adjust product designs and production plans'' if NHTSA were to finalize 
alternative standards other than those the manufacturer requested in 
its petition.\23\
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    \21\ NHTSA-2022-0048-0006, Attachment 1, at 1.
    \22\ Id.
    \23\ NHTSA-2022-0048-0006, Attachment 1, at 2.
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    Ferrari also supported the proposed alternative standards for 
affected model years and urged NHTSA to adopt the final standards as 
quickly as possible.\24\ Ferrari reiterated the company's use of fuel 
economy-improving technologies, and stated that its fuel economy levels 
are highly dependent on the mix of models that its purchasers choose 
because of the limited number of models and powertrains.\25\ Ferrari 
also noted EPA's final determination for alternative GHG standards for 
low volume manufacturers, which set standards for Ferrari for MYs 2017 
through 2021.\26\
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    \24\ NHTSA-2022-0048-0004, Attachment 1, at 3.
    \25\ Id.
    \26\ Id.
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    NHTSA considered these four comments. As discussed above, Congress 
provided in EPCA/EISA statutory authority for NHTSA to exempt a low 
volume manufacturer of passenger automobiles from the industry-wide 
passenger car standard if NHTSA concludes that the industry-wide 
passenger car standard is more stringent than the maximum feasible 
average fuel economy level that the manufacturer can achieve, and NHTSA 
establishes an alternative standard for that manufacturer's fleet of 
passenger cars at the maximum feasible average fuel economy level that 
the manufacturer can achieve. In addition, as stated in the NPRM, NHTSA 
does not consider the ability of a manufacturer to (through an increase 
in the price of the vehicle or otherwise) absorb civil penalty payments 
from having to meet a higher standard.\27\ NHTSA disagrees with the 
individual commenter's assessment of the state of climate science, and 
that comment is discussed further in the Final Environmental 
Assessment, below. Finally, NHTSA considered Auto Innovators' and 
Ferrari's comments and is finalizing these alternative standards as 
expeditiously as possible.
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    \27\ 87 FR 39443 (July 1, 2022) (citing 44 FR 3710 (Jan. 18, 
1979)).
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4. Maximum Feasible Average Fuel Economy for Exempted Manufacturers

    Considering the information presented in the proposed decision and 
comments received, NHTSA is setting alternative average fuel economy 
standards for these seven manufacturers for each model year at the 
levels identified in the proposed decision. NHTSA used several sources 
of data to determine these CAFE levels, including final and non-final 
fuel economy data, and CBI and non-CBI submitted by manufacturers. In 
addition, the standards do not backslide for imminently future model 
years. NHTSA believes that these alternative standards are maximum 
feasible for these manufacturers for these model years, that they are 
consistent with the purpose of EPCA/EISA, and that they appropriately 
balance the CAFE exemption program with EPCA's directive to conserve 
energy.

                                                    Table 4--Alternative Standards for MYs 2008-2023
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                                                                                                             Mobility
                                           Aston Martin       Ferrari       Koenigsegg        McLaren        Ventures         Pagani          Spyker
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2008....................................            19.0  ..............  ..............  ..............  ..............  ..............            19.6
2009....................................            18.6  ..............  ..............  ..............  ..............  ..............            19.6
2010....................................            19.2  ..............  ..............  ..............  ..............  ..............            20.7
2011....................................            19.1  ..............  ..............  ..............  ..............  ..............  ..............
2012....................................            19.2  ..............  ..............            23.2  ..............  ..............  ..............
2013....................................            20.1  ..............  ..............            24.0  ..............  ..............  ..............
2014....................................            19.7  ..............  ..............            23.8            19.6            15.6  ..............
2015....................................            19.8  ..............            16.7            22.9            20.1  ..............  ..............
2016....................................            20.2            21.7  ..............            23.2            20.1            15.6  ..............
2017....................................            21.4            21.5  ..............            24.3  ..............            15.6  ..............
2018....................................            22.9            21.6            16.7            23.3  ..............            15.6  ..............
2019....................................            22.4  ..............            16.6            22.5  ..............            15.5  ..............
2020....................................            22.6            21.1            16.6            22.5  ..............            15.5  ..............
2021....................................            24.9  ..............            16.6            21.5  ..............            15.5  ..............
2022....................................            24.9  ..............            16.9            24.6  ..............            15.5  ..............
2023....................................            24.9  ..............            16.9            25.7  ..............            15.5  ..............
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[[Page 12753]]

    These alternative standards apply only to Aston Martin Lagonda 
Limited for MYs 2008-2023, Ferrari N.V. for MYs 2016-2018 and MY 2020, 
Koenigsegg Automotive AB for MYs 2015 and 2018-2023, McLaren Automotive 
for MYs 2012-2023, Mobility Ventures LLC for MYs 2014-2016, Pagani 
Automobili S.p.A for MYs 2014 and 2016-2023, and Spyker Automobielen 
B.V. for MYs 2008-2010. They do not apply to low volume manufacturers 
generally or to a class of automobiles of exempted manufacturers. 
Readers should remember that NHTSA does not set alternative standards 
for a given model year unless a manufacturer has requested them, and 
thus certain cells in the table above are blank.
    NHTSA is also finalizing the correction to the reference to 
alternative fuel economy standards in 49 CFR 531.5(a), as paragraph (f) 
does not exist.

5. Regulatory Impact Analyses

a. Regulatory Evaluation

    NHTSA has considered the potential impacts of this action under 
Executive Order (E.O.) 12866 and the Department of Transportation's 
regulatory policies and procedures and has concluded that those orders 
do not apply because this action is not an agency statement of general 
applicability and future effect. This decision is not generally 
applicable, because the agency has proposed to set alternative average 
fuel economy standards for each manufacturer.

b. Regulatory Flexibility Determination

    Pursuant to the Regulatory Flexibility Act (5 U.S.C. 601 et seq., 
as amended by the Small Business Regulatory Enforcement Fairness Act 
(SBREFA) of 1996), whenever an agency is required to publish a notice 
of proposed rulemaking, it must prepare and make available for public 
comment a regulatory flexibility analysis that describes the effect of 
the rule on small entities (i.e., small businesses, small 
organizations, and small governmental jurisdictions) unless the head of 
an agency certifies the proposal will not have a significant economic 
impact on a substantial number of small entities. The Small Business 
Administration's regulations at 13 CFR part 121 define a small 
business, in part, as a business entity ``which operates primarily 
within the United States.'' (13 CFR part 121.105(a)). SBREFA amended 
the Regulatory Flexibility Act to require Federal agencies to provide a 
statement of the factual basis for certifying that a proposal will not 
have a significant economic impact on a substantial number of small 
entities.
    I certify this final decision will not have a significant impact on 
a substantial number of small entities. This final decision exempts low 
volume manufacturers from the generally applicable passenger car CAFE 
standards and sets alternative standards for those low volume 
manufacturers at maximum feasible levels.

c. National Environmental Policy Act

    The National Environmental Policy Act of 1969 (NEPA) (42 U.S.C. 
4321-4347) requires Federal agencies to consider the environmental 
impacts of proposed major Federal actions significantly affecting the 
quality of the human environment, as well as the impacts of 
alternatives to the proposed action.\28\ The Council on Environmental 
Quality (CEQ) NEPA implementing regulations (40 CFR parts 1500-1508) 
direct Federal agencies to prepare an environmental assessment for a 
proposed action that is not likely to have significant effects or when 
the significance of the effects is unknown.\29\ The environmental 
assessment must ``briefly discuss the purpose and need for the proposed 
action, alternatives[ ], and the environmental impacts of the proposed 
action and alternatives, and include a listing of agencies and persons 
consulted.'' \30\ This section serves as the National Highway Traffic 
Safety Administration's (NHTSA) Final Environmental Assessment (Final 
EA).
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    \28\ 42 U.S.C. 4332(2)(C).
    \29\ 40 CFR 1501.5(a).
    \30\ 40 CFR 1501.5(c)(2).
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1. Purpose and Need for Action
    In accordance with the Energy Policy and Conservation Act (EPCA) of 
1975, as amended by the Energy Independence and Security Act (EISA) of 
2007, and the procedures at 49 CFR part 525, the purpose of this action 
is to set alternative corporate average fuel economy (CAFE) standards 
for low volume manufacturers that have petitioned the agency for an 
alternative standard at the maximum feasible fuel economy level that 
NHTSA believes each manufacturer can achieve in each model year. While 
the purpose of setting industry-wide fuel economy standards under EPCA/
EISA is, among other things, energy conservation, Congress granted 
NHTSA the ability to provide an exemption to low volume manufacturers 
in part because it believed that the need of the United States to 
conserve energy would not be adversely affected by allowing the limited 
exemption.\31\ If NHTSA did not grant alternative standards for low 
volume manufacturers, they would have to meet the industry-wide 
passenger car standard in each applicable model year, which, in most if 
not all cases, is more stringent than the maximum feasible fuel economy 
level that NHTSA believes these low volume manufacturers can achieve.
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    \31\ See, e.g., 44 FR at 3711 (Jan. 18, 1979).
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    When determining the maximum feasible fuel economy levels that 
manufacturers can achieve in each model year, EPCA/EISA requires that 
NHTSA consider four factors: technological feasibility, economic 
practicability, the effect of other motor vehicle standards of the 
government on fuel economy, and the need of the United States to 
conserve energy. NHTSA relies on information in each low volume 
manufacturer's petition for exemption to propose alternative average 
fuel economy standards at the maximum feasible level for each 
manufacturer. However, the unique nature of this action requires NHTSA 
to set maximum feasible standards for model years that have already 
passed. NHTSA's proposed action and range of alternatives considered 
below reflect these statutory and practical considerations.
2. Proposed Action and Alternatives
    The Draft EA considered a ``no-action alternative'' and two 
alternatives. The ``no-action alternative'' assumed that in the absence 
of NHTSA action on their petitions, manufacturers would meet their 
footprint-based CAFE standard for MYs 2013-2023.\32\ One alternative 
proposed to set alternative standards at the levels that the 
manufacturers requested for model years for which NHTSA does not have 
final fuel economy data (the ``as-requested'' alternative); and the 
preferred alternative proposed to set standards at the levels detailed 
in the preamble above. NHTSA did not consider an alternative that 
proposed to set an alternative standard for a model year at a lower 
level than the manufacturer achieved in past model years (i.e., in some 
cases for past model years what

[[Page 12754]]

the manufacturer requested) because that would not have been the 
maximum feasible fuel economy level that the manufacturer could 
achieved.
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    \32\ As discussed in the proposal and Draft EA (87 FR 39439, 
July 1, 2022), NHTSA has expired MY 2012 and earlier fuel economy 
credits in accordance with 49 CFR 536.5(c)(2), meaning that low 
volume manufacturers that built vehicles in MYs 2008-2012 cannot now 
buy fuel economy credits from manufacturers that exceeded their CAFE 
standard in those years to offset the CAFE values of the low volume 
vehicles produced in those years. As a simplifying assumption, 
because there can be no difference between the fuel used in MYs 
2008-2012 under the no-action alternative baseline and action 
scenarios, fuel use in those years was not considered.
---------------------------------------------------------------------------

3. Affected Environment
    The Draft EA described that NHTSA actions regulating motor vehicle 
fuel economy could have a range of environmental impacts, including on 
energy use, air quality, climate change, resource extraction and use, 
and on environmental justice communities, among others. Every time 
NHTSA sets industry-wide CAFE standards, the agency examines the 
environmental impact of the proposed standards and a range of 
alternatives on these resources in an environmental impact statement 
(EIS). The EIS uses estimates of fuel consumption that would result if 
the agency adopted different levels of fuel economy standards to 
quantitatively estimate the impacts on energy use, air quality, and 
greenhouse gas emissions and climate change. NHTSA also qualitatively 
discusses the lesser impacts on other resource areas, including land 
use and development, hazardous materials and regulated waste, 
historical and cultural resources, noise, and environmental justice.
    NHTSA's Final Supplemental Environmental Impact Statement (Final 
SEIS) for MY 2024-2026 passenger car and light truck fuel economy 
standards (hereinafter ``Final SEIS'') provided the most up-to-date 
estimates of the impact of different levels of fuel economy standards 
on these resource areas and discussion of the environmental impacts, at 
the time that NHTSA was completing the Draft EA associated with this 
decision.\33\ The Final SEIS discussions of environmental impacts 
resulting from changes in fuel use from motor vehicles were 
incorporated by reference in the Draft EA,\34\ and the Draft EA 
contains a summary of those discussions.\35\
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    \33\ NHTSA has released a Draft Environmental Impact Statement 
for Corporate Average Fuel Economy Standards for Passenger Cars and 
Light Trucks, Model Years 2027-2032, and Fuel Efficiency Standards 
for Heavy-Duty Pickup Trucks and Vans, Model Years 2030-2035, 
available at https://www.regulations.gov/docket/NHTSA-2022-0075. 
This Draft EIS has additional analysis of the affected environment 
and environmental consequences associated with different levels of 
fuel economy and fuel efficiency standards; however, there is an 
ongoing comment period for that Draft EIS and NHTSA is still 
receiving comments on the approach and analysis used in that Draft 
EIS, which may yet be updated in the Final EIS. Accordingly, NHTSA 
continues to reference the Final SEIS mentioned above in this Final 
EA/FONSI.
    \34\ 40 CFR 1501.12.
    \35\ 87 FR 39455 (July 1, 2022).
---------------------------------------------------------------------------

4. Environmental Consequences
    The Draft EA estimated the levels of changes in fuel consumption 
under the ``no-action alternative'' and two alternatives to provide a 
starting point to estimate a relative potential range of environmental 
impacts. To estimate the amount of additional fuel consumed by the 
exempted fleet over its operating lifetime,\36\ NHTSA calculated the 
difference between the low volume manufacturer's footprint-based 
standard for MY 2013 forward (i.e., the estimated fuel used under the 
no-action alternative, for model years for which fuel economy credits 
are available) and its proposed alternative standard (or achieved fleet 
fuel economy for model years that have already passed). NHTSA 
multiplied this difference by the manufacturer's estimated U.S. 
production volume,\37\ and then by estimated total miles that these 
vehicles could travel as an active part of the fleet (i.e., the 
vehicles' estimated yearly VMT).\38\ The resulting estimates of 
additional lifetime fuel consumption for all manufacturers and model 
years considered in this action compared to the no-action alternative 
are shown below.
---------------------------------------------------------------------------

    \36\ Approximately 15 years, based on the estimated passenger 
sedan life as calculated in the latest industry-wide CAFE rulemaking 
action.
    \37\ As discussed in the proposal, where NHTSA did not have 
final production data for a manufacturer, in particular where 
estimated production data is still confidential, the agency averaged 
the last three years of a manufacturers' actual production data.
    \38\ As discussed in the proposal, NHTSA estimated that a high-
performance vehicle would travel 2,543 miles per year, while a 
mobility van would travel 11,128 miles per year.

                             Table 6--Estimated Additional Lifetime Fuel Consumption
----------------------------------------------------------------------------------------------------------------
                                                                                Preferred
                                                             No action         alternative        As requested
----------------------------------------------------------------------------------------------------------------
Total Gallons..........................................         48,873,908         88,643,357         88,997,267
Difference from the No-Action Alternative..............  .................         39,769,449         40,123,359
----------------------------------------------------------------------------------------------------------------

    To put this in perspective, NHTSA looked at the average amount of 
fuel consumed by an average passenger car subject to the industry-wide 
passenger car CAFE standard over its useful life, in this case a MY 
2017 Toyota Camry. The estimated total gallons of fuel used if 
standards are set at the levels proposed in this action are roughly 
equivalent to the fuel used by approximately 8,534 MY 2017 Toyota 
Camrys. In other words, setting alternative standards at the levels 
proposed in this notice for the 15 model years covered by this notice 
would have the energy effect of a one-time addition of 171 MY 2017 
Toyota Camrys per U.S. state. Compared to the pre-pandemic peak of 
approximately 17 million vehicles sold in the United States in a model 
year, the vehicles considered in this notice that cover fifteen model 
years contribute only a small amount to total U.S. transportation fuel 
use.
    As with the impacts to energy use, NHTSA tentatively concluded that 
the proposed action would have a relatively minimal impact on air 
quality, and accordingly, air quality-related health effects, based on 
the relative percentage of fuel used by the vehicles considered in this 
action compared to total light-duty vehicle fuel use. As discussed in 
Chapter 4 of NHTSA's Final SEIS, nationwide criteria pollutant 
emissions from vehicle tailpipes are projected to decrease over time, 
even as VMT increases, due to increasingly stringent EPA regulation of 
criteria pollutant emissions and reductions in emissions from fuel 
production. NHTSA does not expect that trend to change based on the 
levels of fuel use projected for this action. In addition, some of the 
increases in criteria pollutant emissions projected in the Final SEIS 
are due to increases in upstream emissions from power plants from 
increased electric vehicle use. The vehicles considered in this action 
run primarily on gasoline; none of the vehicles with electrified 
powertrains draw energy from the electric grid. The same projected 
trends exist for toxic air pollutants; emissions are projected to 
decrease through 2050 based on increasingly stringent EPA regulations 
and reductions in emissions from fuel production, despite growth in 
total VMT. NHTSA does not expect that any of these trends would change 
based

[[Page 12755]]

on the minor increases in fuel use projected from this decision.
    To estimate the approximate effect that this action would have on 
greenhouse gas emissions, NHTSA first used EPA's Greenhouse Gas 
Equivalencies Calculator to convert the estimated additional gallons of 
gasoline that would be used under the alternatives to metric tons of 
carbon dioxide equivalent emissions.\39\ Over the lifetime of all model 
year vehicles considered in this notice (15 model years' worth of 
vehicles that each last approximately 15 years), for the fuel use 
considered in this action, the following additional carbon dioxide 
equivalent emissions are expected to result: 285,193 metric tons of 
carbon dioxide equivalent emissions under the ``as-requested'' 
alternative, and 282,047 metric tons of carbon dioxide equivalent 
emissions at the preferred alternative levels. To put this in 
perspective, NHTSA referenced EPA's Inventory of U.S. Greenhouse Gas 
Emissions and Sinks 1990-2019 report, which estimated that the U.S. 
passenger car and light truck vehicle fleet emits a little over a 
thousand million metric tons of carbon dioxide equivalent emissions per 
year (averaged over 2017, 2018, and 2019).\40\ Over the useful life of 
a vehicle considered in this action, the vehicles considered in this 
action are estimated to produce an estimated increase in carbon dioxide 
equivalent emissions of 0.00169% and 0.00167% (for the as-requested and 
preferred alternative levels, respectively) of total light-duty vehicle 
carbon dioxide equivalent emissions over what the vehicles would have 
produced had they met their footprint-based standard.
---------------------------------------------------------------------------

    \39\ U.S. EPA Greenhouse Gas Equivalencies Calculator, https://www.epa.gov/energy/greenhouse-gas-equivalencies-calculator. EPA 
specifies that estimates from this calculator are approximate and 
should not be used for emission inventories or formal carbon 
emissions analysis. NHTSA used these estimates as part of its 
determination that a formal carbon emissions analysis is not 
required for this action.
    \40\ U.S. EPA, Inventory of U.S. Greenhouse Gas Emissions and 
Sinks: 1990-2019, at Table 2-13, available at https://www.epa.gov/sites/default/files/2021-04/documents/us-ghg-inventory-2021-main-text.pdf?VersionId=wEy8wQuGrWS8Ef_hSLXHy1kYwKs4.ZaU.
---------------------------------------------------------------------------

    NHTSA did not perform independent climate modeling because the 
agency believes that it is reasonable to infer that if relatively 
small--but not trivial--climate impacts would result from large-scale 
changes in fuel use from changes in the industry-wide passenger car and 
light truck standards, as demonstrated in the Final SEIS and referenced 
in the Draft EA, estimating the impacts of the no-action alternative 
and alternatives presented in this notice would not present any 
additional meaningful information for decisionmakers and the public.
    Some potential impacts of the proposed action could be mitigated 
through other means; as discussed above, EPA also sets alternative 
carbon dioxide emissions standards for some of the low volume 
manufacturers considered in this notice. Unlike the structure of EPCA/
EISA, which allows civil penalty payment for each 0.1 of a mile a 
gallon by which the manufacturer falls short of the applicable average 
fuel economy standard,\41\ manufacturers must comply with EPA 
regulations promulgated under the Clean Air Act to sell their vehicles. 
To the extent that EPA sets higher alternative standards for model 
years 2022 and 2023 vehicles, some of the estimated impacts could 
potentially be mitigated. Next, the estimates of fuel use presented 
here are dependent on several assumptions, one being how many miles 
these vehicles are driven. The vehicles covered by this final decision 
represent an extremely small fraction of overall motor vehicle sales 
and on-road VMT; most of the vehicles considered in this notice are 
estimated to drive only a quarter of the mileage of the average 
passenger car. If these vehicles were or are driven less than NHTSA 
estimated, fuel use, air quality impacts, and greenhouse gas emissions 
would be reduced accordingly. However, to the extent that some of the 
vehicles considered in this action have already been built and sold, 
the impacts of those vehicles achieving a lower fuel economy level than 
their footprint-based standard represent an unavoidable adverse impact.
---------------------------------------------------------------------------

    \41\ 49 U.S.C. 32912(b).
---------------------------------------------------------------------------

    Both alternatives considered in the Draft EA and now this Final EA 
result in increased fuel use compared to the no-action alternative; 
however, the preferred alternative does result in marginally less 
estimated fuel use than the ``as requested'' alternative. NHTSA does 
not believe that establishing alternative CAFE standards at the 
preferred alternative levels would contribute appreciably to any of the 
environmental impacts considered in this Final EA.
    NHTSA invited public comments on the contents and tentative 
conclusions of the Draft EA. No public comments directly addressing the 
Draft EA were received. One individual commenter loosely commented in 
opposition to industry-wide fuel economy regulations based on, among 
other things, concern about the quality and integrity of data used in 
climate science.\42\ NHTSA disagrees with the commenter's assessment of 
the quality and integrity of peer-reviewed studies on climate change, 
and summarizes in the Final SEIS the panel-reviewed synthesis and 
assessment reports from various agencies that NHTSA relies on,\43\ in 
accordance with CEQ regulations to ensure the scientific integrity of 
discussions and analyses in environmental documents.\44\ As discussed 
in the Final SEIS, NHTSA relies on panel-reviewed synthesis and 
assessment reports ``because these reports assess numerous individual 
studies to draw general conclusions about the state of climate science 
and potential impacts of climate change, as summarized or found in 
peer-reviewed reports. These reports are reviewed and formally accepted 
by, commissioned by, or in some cases authored by U.S. government 
agencies and individual government scientists, and in many cases 
reflect and convey the consensus conclusions of expert authors. These 
sources have been vetted by both the climate change research community 
and by the U.S. government.'' \45\ NHTSA notes here and in the Final 
SEIS that uncertainty still exists, as with any analysis of complex, 
long-term changes that involve many assumptions and uncertainties. That 
is why ``NHTSA relies on methods and data to analyze climate impacts 
that represent the best and most current information available on this 
topic and that have been subjected to extensive peer review and 
scrutiny.'' \46\
---------------------------------------------------------------------------

    \42\ NHTSA-2022-0048-0007, Attachment 1.
    \43\ Final SEIS, at 5-1.
    \44\ See, e.g., 40 CFR 1502.23.
    \45\ Final SEIS, at 5-2.
    \46\ Id.
---------------------------------------------------------------------------

    NHTSA did not make any changes to the Final EA in response to this 
comment.
5. Agencies and Persons Consulted
    NHTSA coordinated with EPA to seek its feedback on the Draft EA, 
and EPA had no comments or suggested changes. NHTSA also coordinated 
with EPA for further input in drafting the Final EA.
6. Finding of No Significant Impact
    NHTSA has reviewed the information presented in this Final EA and 
concludes that the proposed action will not have a significant effect 
on the human environment and that a ``finding of no significant 
impact'' is appropriate. This statement constitutes the agency's 
``finding of no significant impact,'' and an environmental impact 
statement will not be prepared.

[[Page 12756]]

Regulatory Text

List of Subjects in 49 CFR Part 531

    Energy conservation, Gasoline, Imports, Motor vehicles.

    In consideration of the foregoing, 49 CFR part 531 is amended as 
follows:

PART 531--PASSENGER AUTOMOBILE AVERAGE FUEL ECONOMY STANDARDS

0
1. The authority citation for part 531 is revised to read as follows:

    Authority:  49 U.S.C. 32902, delegation of authority at 49 CFR 
1.95.


0
2. Amend Sec.  531.5 by:
0
a. Removing from paragraph (a) the term ``paragraph (f)'' and adding in 
its place the term ``paragraph (e)'';
0
b. Revising paragraphs (e)(4) and (15); and
0
c. Adding paragraphs (e)(16) through (20).
    The revisions and additions read as follows:


Sec.  531.5  Fuel economy standards.

* * * * *
    (e) * * *
    (4) Aston Martin Lagonda Limited

      Table 8 to Sec.   531.5(e)(4)--Average Fuel Economy Standard
------------------------------------------------------------------------
                                                            (Miles per
                       Model year                             gallon)
------------------------------------------------------------------------
1979....................................................            11.5
1980....................................................            12.1
1981....................................................            12.2
1982....................................................            12.2
1983....................................................            11.3
1984....................................................            11.3
1985....................................................            11.4
2008....................................................            19.0
2009....................................................            18.6
2010....................................................            19.2
2011....................................................            19.1
2012....................................................            19.2
2013....................................................            20.1
2014....................................................            19.7
2015....................................................            19.8
2016....................................................            20.2
2017....................................................            21.4
2018....................................................            22.9
2019....................................................            22.4
2020....................................................            22.6
2021....................................................            24.9
2022....................................................            24.9
2023....................................................            24.9
------------------------------------------------------------------------

* * * * *
    (15) Spyker Automobielen B.V.

     Table 19 to Sec.   531.5(e)(15)--Average Fuel Economy Standard
------------------------------------------------------------------------
                                                            (Miles per
                       Model year                             gallon)
------------------------------------------------------------------------
2006....................................................            18.9
2007....................................................            18.9
2008....................................................            19.6
2009....................................................            19.6
2010....................................................            20.7
------------------------------------------------------------------------

    (16) Ferrari

     Table 20 to Sec.   531.5(e)(16)--Average Fuel Economy Standard
------------------------------------------------------------------------
                                                            (Miles per
                       Model year                             gallon)
------------------------------------------------------------------------
2016....................................................            21.7
2017....................................................            21.5
2018....................................................            21.6
2020....................................................            21.1
------------------------------------------------------------------------

    (17) Koenigsegg

     Table 21 to Sec.   531.5(e)(17)--Average Fuel Economy Standard
------------------------------------------------------------------------
                                                            (Miles per
                       Model year                             gallon)
------------------------------------------------------------------------
2015....................................................            16.7
2018....................................................            16.7
2019....................................................            16.6
2020....................................................            16.6
2021....................................................            16.6
2022....................................................            16.9
2023....................................................            16.9
------------------------------------------------------------------------

    (18) McLaren

     Table 22 to Sec.   531.5(e)(18)--Average Fuel Economy Standard
------------------------------------------------------------------------
                                                            (Miles per
                       Model year                             gallon)
------------------------------------------------------------------------
2012....................................................            23.2
2013....................................................            24.0
2014....................................................            23.8
2015....................................................            22.9
2016....................................................            23.2
2017....................................................            24.3
2018....................................................            23.3
2019....................................................            22.5
2020....................................................            22.5
2021....................................................            21.5
2022....................................................            24.6
2023....................................................            25.7
------------------------------------------------------------------------

    (19) Mobility Ventures

     Table 23 to Sec.   531.5(e)(19)--Average Fuel Economy Standard
------------------------------------------------------------------------
                                                            (Miles per
                       Model year                             gallon)
------------------------------------------------------------------------
2014....................................................            19.6
2015....................................................            20.1
2016....................................................            20.1
------------------------------------------------------------------------

    (20) Pagani

     Table 24 to Sec.   531.5(e)(20)--Average Fuel Economy Standard
------------------------------------------------------------------------
                                                            (Miles per
                       Model year                             gallon)
------------------------------------------------------------------------
2014....................................................            15.6
2016....................................................            15.6
2017....................................................            15.6
2018....................................................            15.6
2019....................................................            15.5
2020....................................................            15.5
2021....................................................            15.5
2022....................................................            15.5
2023....................................................            15.5
------------------------------------------------------------------------


    Issued under authority delegated in 49 CFR 1.95 and 49 CFR 
501.4.
Sophie Shulman,
Deputy Administrator.
[FR Doc. 2024-03119 Filed 2-16-24; 8:45 am]
BILLING CODE 4910-59-P