Statement of Joan Claybrook
Mr. Chairman and Members of the Committee:
I am pleased to accept your invitation to testify today on the Firestone tire defect that has killed at least 88 and injured 250 people, most of them in Ford Explorers. I am President of Public Citizen, a national public interest organization founded by Ralph Nader in 1971 with 150,000 members nationwide. I served as Administrator of the National Highway Traffic Safety Administration from 1977 to 1981. This agency is responsible for administering the recall of the Firestone tires. The Firestone 500 recall occurred when I was Administrator.
Much has been written in the past month about the lethal combination of Ford Explorers and Firestone tires. This is a design defect exacerbated by the fact that Ford required a low inflation pressure because of rollover problems with these vehicles. Firestone tires inflated at 26 psi overheat with highway use, causing the tread to separate and the SUVs to crash, not infrequently rolling over and causing catastrophic and fatal injuries. This tragedy is teaching the public as well as policymakers a number of lessons. I would like to comment on five issues and make recommendations for more effective enforcement of the nation s motor vehicle safety defect laws.
1. Ford and Firestone covered up safety problems with the tire/SUV combination for a decade. Coverups will continue without corrective action by NHTSA.
The Ford Explorer was first offered for sale in March 1990. Ford internal documents show the company engineers recommended changes to the vehicle design after it rolled over in company tests prior to introduction, but other than a few minor changes, the suspension and track width were not changed. Instead, Ford, which sets the specifications for the manufacture of its tires, decided to remove air from the tires, lowering the recommended psi to 26. The Firestone-recommended psi molded into the tire for maximum load is 35 psi.
Within a year of introduction, lawsuits against Ford and Firestone were filed for tire failures that resulted in crashes and rollovers. At least five cases were filed by 1993, and many others followed in the early 1990s. Almost all were settled, and settled with gag orders prohibiting the attorneys and the families from disclosing information about the cases or their documentation to the public or DOT. When lawsuits are filed against a company about a safety defect, the company organizes an internal investigation to assemble information and analysis about the allegations. Top company officials are kept informed about all lawsuits against the company, particularly when they accumulate concerning one problem. There is no question the companies knew they had a problem. But they kept it secret.
In 1996, several state agencies in Arizona began having major problems with Firestone tires on Explorers. According to news reports, various agencies demanded new tires, and Firestone conducted an investigation of the complaints, tested the tires and asserted that the tires had been abused or under-inflated.
In 1998, Ford and Firestone were in discussions about tire failures with Middle Eastern, Asian and South American countries. Tires were tested and analyzed. Ford eventually decided to conduct its own recall without Firestone and replace the tires in the various countries in 1999 and 2000. It also instructed Firestone to add a nylon ply to the tires it manufactured in Venezuela for additional strength and it made suspension changes to the Explorer. Ford did not specify adding the nylon ply for U.S.-made Firestone tires nor did it change the Explorer suspension at this time. In May, a top Ford official in Venezuela was quoted in the press as saying the company was replacing the tires because in Venezuela "the highways allow drivers to travel at high speeds for a sustained period of time, leading to the loosening of the rolling surface of the tire, its consequent blowout and the accident."
Last week, the Venezuelan safety regulatory agency, Indecu, concluded after an investigation that Firestone and Ford "met to plan ways out of a situation that was affecting their commercial interests, at the price of causing damage, destruction and death," and is recommending possible criminal enforcement for involuntary manslaughter. Neither Ford nor Firestone informed the National Highway Traffic Safety Administration of this recall, euphemistically labeled a "No Charge Service Program Award Notification."
Incidentally, there are a number of parallels between this recall in 2000 and the 1978 recall of the Firestone 500. Most particularly, there was a documented coverup by Firestone of the 500 defect, spurred by the lack of a Firestone replacement tire. When the coverup was disclosed, the top management of the company was replaced as Firestone was severely damaged in reputation and economically. But a key difference is that the Firestone 500 was used on passenger cars, which rarely rolled over with tire failure. NHTSA documented 41 deaths with the 500, a recall, involving seven million tires.
Once again, when confronted with accusations about the performance of the tire, Firestone has misleadingly claimed owner abuse (i.e. under-inflation, rough use or improper repairs).
2. The National Highway Traffic Safety Administration needs additional legislative authority to assure that manufacturers obey the law, report safety defects and recall unsafe products.
To prevent coverups of safety defects in the future, the National Traffic and Motor Vehicle Safety Act should be amended. In March 2000 the agency sent legislation to the Congress which would make some improvements, but additional authority is needed. The Congress should:
a. Increase civil penalties for failure to recall a defective vehicle or part or withholding information from the agency. Now the maximum penalty is $925,000, hardly a deterrent for multinational corporations. The penalty for each violation should be increased from $1,000 to $10,000 (as at the Environmental Protection Agency); the violation for withholding documents should be per day rather than per document as it is now (no matter how long it is withheld). There should be no maximum penalty.
b. As in the Food and Drug Administration and the Environmental Protection Agency laws, there should be criminal penalties for knowing and willful refusal to recall a defective vehicle or part or for withholding information that results in deaths and injuries. Chairman John Moss, after reviewing the Firestone 500 debacle, recommended criminal penalties be added to the NHTSA statute.
c. As recommended by NHTSA s proposed bill, a company should be required by law to test its products before self-certifying for compliance with the agency s standards. Such testing is not now required by law.
d. The statute of limitations for NHTSA to mandate a recall is now eight years for vehicles and three years for tires from the date of manufacture. It should be extended, as the agency recommends, to 10 years for vehicles and five years for tires.
e. There is disagreement about whether the current law requiring manufacturers to send NHTSA copies of all notices sent to dealers and owners about a defect is applicable in this case. Ford sent notices to foreign dealers about a defect in a product made and sold in the U.S. and also sold abroad. Does the fact that the notice was sent to foreign dealers negate Ford s responsibility to notify NHTSA? I don t think so, but certainly the law should be clarified that this is a company s responsibility in this age of globalization.
f. NHTSA s budget needs to be larger, particularly for enforcement. Ninety-four percent of transportation deaths occur on the highway, yet NHTSA has only a tiny percentage of the Transportation budget. Although it has been increased in recent years, and I thank this Subcommittee for that, it is still 30 percent below, in real dollars, what it was when I left the agency at the beginning of 1981. Its enforcement budget is about one-half of the 1980 budget. It has fewer than 20 engineer/investigators working on vehicle safety defects for the entire country.
3. The Firestone/Ford recall should be expanded to cover all ATX, ATX II and Wilderness tires to protect the public from this catastrophic defect, and all data and information should be made public to restore public trust.
Much of the data on which Ford based its analysis of Firestone claims data is still not public and subject to outside scrutiny (such as how many tires were made at each plant and when -- an important factor since the defect appears to emerge after two to four years of use), and it is based on information through April 2000. None of the recent information that has been pouring into the companies and NHTSA as the public is getting informed about the problem is included. It also covers only claims data -- claims for compensation for injury or property damage. It does not cover warranty claims or adjustment data for tire failures. It also does not cover any information known to Ford (although there will be duplication between Ford and Firestone data). It also does not cover new information now known by NHTSA about claims.
NHTSA last week analyzed data (complaints, lawsuits, injuries, including information submitted to date from Ford and Firestone) and determined that the recall should be enlarged to cover another 1.4 million tires. NHTSA said it is still investigating to determine if the recall should be enlarged further. It issued a consumer advisory because Firestone refused to enlarge the recall, an indication of Firestone s attitude toward a safety defect that gives the consumer no warning and can result in death and severe injury when the vehicle is operated normally. This same attitude was evident in Firestone s offer made on August l6 in public newspaper ads that it would reimburse owners who bought other tires, but the offer ended on August l6. Had it not been for a temporary restraining order issued by a federal judge in Louisville preventing the company from discontinuing the one-day offer, Firestone might have faced a massive consumer revolt, picket lines, more consumer lawsuits and more disputes with its largest customer, Ford Motor Company, which is pressing to get the tires replaced quickly with tires from other manufacturers as well as Firestone.
There is every indication that this problem is a design defect that affects all the tires produced. In the Firestone 500 case, the company at first asserted that only 400,000 tires were defective, those produced in the Decatur plant. But during NHTSA s investigation, as more data was available and company documents were secured and analyzed, we found that the tread separation on the 500 was a design performance defect. The company knew about it for at least three years and never informed NHTSA, and it was at the same time making running changes on the production line to correct the problem in new tires.
There are other indications that the companies should expand the recall. An analysis released last Friday of about 90 lawsuits or claims about to be filed showed that 37 percent covered non-recalled tires. In several of the foreign recalls, l6-inch tires were included (but are not recalled in the U.S.).
There are a number of documents and data that are still secret, either in submissions by the companies to NHTSA or gag orders in lawsuits that should be made public. This may be painful for the companies, but it is essential given the broad public debate about this defect and the need for the companies to regain public trust. This information will probably leak out over time anyway, so it makes sense to release it now.
4. NHTSA failed to discover this defect because it lacks a proactive program to discover safety defects.
a. NHTSA was caught flatfooted because it rarely pushes companies to obey the law. The Department allowed GM to resist recalling its 5 million defectively designed pickup trucks with side-saddle gas tanks that explode in side-impact crashes, and Ford to resist recalling its vehicles equipped with ignition modules that frequently failed, causing vehicles to stall. It allowed Chrysler to label its correction of its minivans with defective rear-door latches that pop open in rear crashes, (throwing occupants outside), a "service campaign" and not a safety recall. And it rarely imposes penalties when it learns companies have slithered around its request to produce documents.
The auto manufacturers have rolled the dice in this coverup and usually win. This time they are the losers as the media spotlight forces the story of the sorry state of manufacturer compliance with the law and safety defect enforcement into the public consciousness.
b. NHTSA also has no early warning system in place and has not been proactive in using sources of information that are on the pulse-beat of current information about vehicle performance. They can and should routinely get information from: auto repair facilities; fleet owners, including national, state and local fleets; lawyers representing deceased and injured family members who find out about defects through discovery and cross examination of manufacturers; insurance company data; and also from the companies themselves.
In this case, State Farm Insurance Co., the nation s largest insurer, sent an E-mail and called NHTSA in 1998 about 21 cases of Firestone tire tread separations, but the agency ignored it. Another 30 cases were sent in 1999, and the agency ignored them as well. How could this happen? How often does the agency check complaints dutifully filed by consumers through its hotline and in letters to spot trends? They are all on a computer list by make, model, and alleged defect. Even if this happens routinely, it s not enough -- as this case illustrates, because most consumers don t bother contacting government agencies.
The agency should require, as does EPA, that a company notify the agency if it gets 25 complaints about the same alleged defect, and require, as does CPSC, that the company notify the agency if three or more lawsuits alleging the same safety defect are filed.
The agency has also used a highly inappropriate system for evaluating whether a safety defect exists, looking at statistical data which are rarely adequate. If it cannot establish a statistical basis, the agency does not find a defect. The courts have held in a number of cases that if a safety element of the vehicle fails and can kill or injure, there is a failure of safety performance sufficient to find a defect, and there is no need to find dead bodies on the highway first.
In short, NHTSA has not been the tough cop on the regulatory beat. When it is, the companies are more safety-conscious, the public is protected, and in the end it is less work for all parties. The Firestone/Ford case shows what happens when safety is not Job 1 in the companies or in the government.
5. Essential safety standards are severely out of date, were scrapped or delayed in the Reagan years, or are prohibited by law because of industry lobbying.
a. The tire safety standard is 32 years old and not fully effective for testing radial tires. Both Ford and GM have recently stated they favor an improved standard. The current standard tests for strength, endurance and how well the tire remains on the rim. Radial tires last much longer than bias ply tires and should be subjected to a tougher standard.
b. The Uniform Tire Quality Grading standard applies only to car tires, not truck/SUV tires. It is a consumer information requirement rating tread wear, traction and heat resistance with the rating molded into the tire. It should be expanded to cover truck/SUV tires.
c. The roof crush standard is 30 years old. It is a static standard requiring weight to be placed on the roof of the vehicle (applied to SUVs beginning in model year 1994) equal to 1.5 times the maximum unloaded weight of the vehicle. In many of the Ford Explorer/Firestone rollover cases, the roof crushes into the vehicle, severely enhancing the likelihood of injury and death. A dynamic rollover crash worthiness standard should be issued addressing roof crush, door lock and hinges, side glazing materials and head protection. Crash protection in rollovers must include effective safety belts with pretensioners.
d. The first petition to NHTSA for a rollover prevention standard was filed by Representative Timothy Wirth 15 years ago. Others followed. In 1991 the Congress required NHTSA to conduct a rollover prevention rulemaking. The agency made an initial effort at developing a safety standard, but then dropped it and instead proposed a consumer information requirement. The auto industry then got the Appropriations Committee to prohibit issuance of a consumer information rule until after a study by the National Academy of Sciences about the usefulness and presentation of consumer information. Finally in May 2000 the agency proposed to conduct New Car Assessment tests for rollover based on a static measurement of track width and center of gravity height, but once again the manufacturers objected and the Appropriations Committee has placed a requirement for yet another study by the NAS before it could be issued. This bill is now in conference.
Our coalition of consumer and health groups and insurers favors dropping the study and letting NHTSA issue the consumer information test. A 1998 Harris poll conducted for Advocates For Highway and Auto Safety show 62 percent of thepublic wants such information. But we also want a rollover prevention standard. It is long overdue. About 9,500 highway deaths annually occur in rollover crashes -- almost 25 percent of all highway deaths. This problem must be addressed, particularly with the advent of SUVs with their susceptibility to rollover.
e. The agency should issue a rule for a tire inflation indicator on the dashboard, as I proposed 22 years ago. It was eliminated by the Reagan administration. The companies complain that tires are not properly inflated but then lobby to undercut consumers ability to properly maintain their tires with accurate information.
f. The tire manufacturing information now molded into the blackwall of the tire should be placed on the whitewall or outside of the tire so a consumer doesn t have to crawl under the car to find it. This was part of my rulemaking plan more than 20 years ago, but it was never issued after I left.
g. The tire reserve load consumer information requirement eliminated in the Reagan years should be reestablished to inform consumers of the maximum rated load capacity of the vehicle, so they know when they should inflate their tires for maximum load carrying.
h. The agency should be alert in this case to whether its requirement for record retention of only five years should be extended, since the critical evidence in this case extends over a decade.
i. Three elements of legislation are needed that are relevant to this case:
First, the 1982 legislation eliminating the responsibility of independent tire dealers to report the names and addresses of tire purchasers to the manufacturer for notification in the event of a recall should be changed back to requiring such recordkeeping as during the period from 1970 until 1982. Independent dealers with computers today can readily supply such names to the manufacturer. The current law only requires the independent dealer to give the consumer a card to mail themselves. A 1986 NHTSA report showed only 11 percent responded. Thus, in this case, most buyers from independent dealers will not be notified by mail.
Second, the current law requires tire owners to return the tire within 60 days of a recall notification (which, I presume means if a manufacturer has no contact information, a consumer would have to rely on news reports) or 60 days after tire availability. Car owners in recalls don t have this limitation. It is confusing enough to get tires replaced without this added complexity. It should be eliminated.
Third, the current prohibition in the law on a NHTSA rule requiring a continuous buzzer to alert occupants to buckle up should be eliminated. Among car companies, only Ford, I believe, now has a continuous buzzer. The current law only permits NHTSA to require a four to eight second buzzer. Belt use is essential in rollovers. It should be encouraged in every way, including when the vehicle is in use.
Thank you Mr. Chairman for the opportunity to testify on this important subject today.