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2015’s Unfinished Automotive Business

2015’s Unfinished Automotive Business
by Roger C. Lanctot on 01-02-2016 at 4:00 pm

 The farther we come, the farther we have to go. While progress in advancing personal transportation was made in 2015, the year closes with glaring elements of unfinished business threatening to impede further progress toward mitigating highway fatalities and reducing emissions and congestion. These areas of unfinished business ought to serve as priorities for regulators, auto makers and their suppliers and service providers.

1. Recalls
The FAST Act, Fixing America’s Surface Transportation, was signed into law by President Obama on December 4. Part of that legislation requires that rental car companies close all open recalls on rental vehicles. The U.S. Congress opted not to prevent new and used car dealers from selling cars with open recalls. Recalls remain a sore spot as we enter 2016.

U.S. Senators Richard Blumenthal (D-Conn.) and Edward J. Markey (D-Mass.) issued a statement on the National Highway Traffic Safety Administration’s (NHTSA) current completion rates for replacing recalled Takata airbags:

“…The current pace of recall efforts is completely unacceptable and a massive disappointment. …NHTSA has moved too slowly and ineptly for years, allowing a patchwork of recalls too confusing for consumers to follow. Automakers have dragged their feet and failed to quickly and clearly communicate the extent of the risk…While NHTSA’s appointment of John D. Buretta, an experienced litigator with a track record of protecting consumers, as independent monitor of the recall is a positive step, NHTSA must ensure that Mr. Buretta has all resources necessary to effectively oversee this critical task.”

Recalls are, by definition, life-threatening flaws in cars. Either out of avarice, stupidity or parsimony the automotive industry refuses to lay to rest once and for all the issue of more effectively closing outstanding recalls.

One of my sons drives an old Saturn with an outstanding recall that he paid to repair. The recall is on the Website of the National Highway Traffic Safety Administration. The local Chevrolet dealer can find the recall in his records. But the dealer can’t validate with General Motors that the recall work will be reimbursed.

Of course, this is a best-case scenario where a seatbelt flaw emerged. My son fixed it – thereby closing the recall. But he can’t get his refund.

Car companies need to clean up their databases, lower their reimbursement barriers and clear the decks of open recalls. One need look no further than Tesla Motors to see a process whereby vehicle flaws create opportunities for customer engagement. If something is wrong with your Model S, Tesla will fix it, with a nearly 100% closure rate. It doesn’t seem to work quite that way with any other auto maker.

Failure to fix recalls in a timely manner creates opportunities for future misery for the car companies and their customers. There’s no excuse or explanation for delay.

Dealers understand the value of connecting with customers. But the car companies are doing little to help drive business to their dealers – for service and sales – in the form of free recall repairs. It is truly a marketing opportunity lost.

The recall process, unfortunate though it may be, must be embraced by the industry. Companies like PistonData make it their business to help dealers locate cars in their area with open recalls. Car makers can and should do more.

2. Vehicle-to-Vehicle Communication
The U.S. Department of Transportation and NHTSA had led us all to believe that a recommendation for rule making regarding V2V technology would be made before the end of the year. It’s New Year’s Eve and we’re still waiting.

The 15-year process of bringing V2V technology to cars in the U.S. has now earned the curiosity and skepticism of the U.S. Congress. In a November 18 hearing, held a week before the Thanksgiving holiday, multiple Congressmen openly questioned the government’s role in fostering, testing and potentially mandating DSRC (dedicated short range communication) V2V technology for cars sold in the U.S.

Congressman Will Hurd (R-Texas) asked why the government was in the business of promoting a particular technology (DSRC) in the first place. NHTSA assistant administrator Nathaniel Beuse commented: “…We’re writing that rule making with an open mind and it’s just a proposal and so the idea is we’ll get comments and we’ll evaluate where we are.”

The misgivings of the joint Congressional subcommittee were best summed up by Dean Garfield, president and CEO, Information Technology Industry Council who testified in response to Congressman Hurd’s question: “Our view is, and I shared it implicitly in my testimony, is that there are complementary technologies that are being developed including advanced LTE and 5G that we can’t tell which is going to prove most effective. And so we think (it best) having the ability for all of those including DSRC to advance without a thumb on the scale including the thumb of the Department of Transportation.”

Fifteen years to develop DSRC and the testing continues without a mandate or rule-making. And now the effort is confronting additional concerns regarding funding, infrastructure and cybersecurity in addition to spectrum sharing, cost and the lack of a business model.

3. Fuel Efficiency
Car makers are considered by industry experts to be on track to meet emissions and fuel efficiency requirements set by NHTSA, California and the Environmental Protection Agency. But sub-$2 gasoline in the U.S. is making it harder than ever to sell EVs while trucks and SUVs are flying off dealer lots.

The government’s fuel efficiency drive looks increasingly out of touch with consumer sentiment in the current environment. There isn’t much incumbent makers of ICE cars can do and cheap gas has the two-sided effect of stimulating already resurgent vehicle sales and discouraging interest in EV technology.

It’s good news for EV upstarts like Tesla and new-comer Faraday Future. But more EVs are on the way perhaps most notably from Volkswagen and Porsche – cheap gas be damned.

4. Fatalities
There were conflicting reports of rising or declining highway fatalities in 2014 relative to 2013. Final figures from NHTSA show 44 fewer deaths on U.S. highways, down from 32,719. Of greater concern are the apparent increases, based on NHTSA estimates, for Q1 and Q2 of 2015:

Source: NHTSA

NHTSA has actively engaged with the industry to promote short-term measures such as five-star safety ratings based on the implementation of enhanced safety systems. The agency has also asked car makers to voluntarily accelerate their deployment of automatic emergency braking technology.

Three weeks ago the USDOT proposed changes to NHTSA’s 5-Star Safety Ratings for new vehicles:

  • A new 5-Star Safety Ratings system, which will, for the first time, encompass assessment of crash-avoidance and advanced technologies as well as pedestrian protection;
  • New tests to assess how well vehicles protect pedestrians from head, leg and pelvic injuries that occur when a pedestrian is struck by a vehicle;
  • A new frontal oblique crash test that measures how well vehicles protect occupants in an angled frontal crash;
  • An improved full frontal barrier crash test to drive safety improvements for rear seat occupants;
  • New crash test dummies, including the Test device for Human Occupant Restraint, (THOR) and WorldSID, that will provide vastly improved data on the effects a crash is likely to have on the human body;
  • An assessment of additional crash-avoidance and advanced technologies that offer drivers the most potential for avoiding or mitigating crashes;
  • Use of half-star increments to provide consumers more discriminating information about vehicle safety performance; and
  • The ability to dynamically update the program more swiftly as new safety technologies emerge.

A final determination regarding implementation of the new measures is expected before the end of 2016. NHTSA redefined its own mandate years ago to focus on crash avoidance. These measures will help but more must be done and auto maker cooperation will be necessary.

5. Distracted Driving

I’m sorry. But this one is easy. The NHTSA should promote a national do-not-touch-your-phone-while-driving requirement for Federal funds eligibility. The patchwork of anti-texting and anti-handheld phone use driving laws and the voluntary initiatives of the wireless carriers have failed to make a dent in the estimated 3,000 annual distracted driving-related fatalities.


6. Cybersecurity
Do you have the sneaking suspicion that everyone is talking about automotive cybersecurity but no one is doing anything about it? It might be more accurate to say that everyone is doing something about automotive cybersecurity but no one seems to have it figured out.

  • NHTSA’s extensive efforts are documented here:
  • The Alliance of Automobile Manufacturers has set up an Information Sharing and Analysis Center – details here:
  • The Society of Automotive Engineers has set up a work-in-progress (WIP) standard J3061 – Cybersecurity Guidebook for Cyber-Physical Vehicle Systems
  • The National Institute of Standards and Technologies (NIST) has set up a cybersecurity framework – details here:

The FAST Act included a Driver Privacy Act, establishing rights to the data stored by event data recorders in vehicles. The Act states: “…any data retained by an event data recorder is the property of the owner or lessee…” and cannot be accessed anyone or any other entity without a court order, owner/lessee consent, NTSB authorized investigation, the need to access data for emergency medical response to crash, or the data is anonymized for traffic safety research.

The FAST Act also requires the Secretary of Transportation to issue a report and recommendations on the “Internet of Things to improve transportation services in rural, suburban, and urban areas.” As part of this review, the report must evaluate innovative transportation systems as well as review “best practices to protect privacy and security.”

The FAST Act finally provides $400M over the next four years in support of Intelligent Transportation Systems (with attention to cybersecurity for such systems). The Act specifically directs the Secretary of Transportation to “assist in the development of cybersecurity research … to help prevent hacking, spoofing, and disruption of connected and automated transportation vehicles.”


NHTSA ends 2015 having failed to make a rule-making recommendation regarding the adoption of DSRC for V2V communications. In spite of that failure, the agency has been awarded $400M to continue its research with particular emphasis on cybersecurity.

The accelerating pace of vehicle fatalities in the first two quarters of 2015, based on NHTSA estimates, point to a deterioration in highway safety in the U.S. NHTSA is caught in the grip of its DSRC fixation, while cellular technologies proliferate both in cars and on mobile devices offering the possibility of a more immediate solution to multiple driving woes from congestion to emissions to fatalities.

While the U.S. is driving toward a V2V mandate and taking a hands-off approach to cellular technologies, Europe has mandated cellular connections and left V2V adoption as a voluntary process. Unfortunately for Europe, the inability of the EU to resolve roaming issues leaves connected car programs and initiatives largely spinning their wheels. The U.S. has an advantage in having a more open wireless roaming regime – setting the stage for life-saving automotive innovation.

The good news for organizations working in this sector is that there is plenty of work to be done in 2016. With luck, there will be more progress to show for that effort by next year’s end.

More articles from Roger…

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