BILL ANALYSIS
AB 323
Page 1
Date of Hearing: April 21, 2009
ASSEMBLY COMMITTEE ON BUSINESS AND PROFESSIONS
Mary Hayashi, Chair
AB 323 (Yamada) - As Amended: April 2, 2009
SUBJECT : Automobile tires.
SUMMARY : Requires auto body repair shops to display a sign
about tire degradation and to provide a consumer disclosure
notice on a tire's manufacture date. Specifically, this bill :
1)Requires auto body repair shops to display, at a conspicuous
place, a sign that advises consumers, among other things,
about automobile tire degradation.
2)Requires an automobile tire retailer, prior to the purchase or
installation of an automobile tire in California, to disclose
in writing to the customer the date each tire purchased or
installed was manufactured.
3)Requires the Auto Body Repair Consumer Bill of Rights (Bill of
Rights) to contain information about the consumer's right to
be informed about the date a tire was manufactured.
4)Imposes a new requirement on auto body repair shops and makes
it a crime to violate those requirements, thereby imposing a
state-mandated local program.
EXISTING LAW :
1)Provides for the registration and regulation of automotive
repair dealers, including auto body repair shops.
2)Provides various business regulations for automobile dealers
and automobile rental agencies.
3)Requires specified insurers to provide each insured with a
Bill of Rights either at the time of application for an
automobile insurance policy or following an accident.
FISCAL EFFECT : Unknown
COMMENTS :
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Purpose of the bill . According to the author's office, "Leading
auto repair businesses are selling aged tires - some as old as
12 years - as new. While the tires are technically 'new' or
unused, they age during the time they are stored on a shelf
awaiting sale, drying out much like an old rubber band, which
can lead to tire tread separation. Tire tread separation causes
a driver to lose control of their car and crash. Consumers are
often unaware of this serious safety issue until it is too late.
"The average tread life of a passenger car tire has increased
from 24,000 miles in 1973 to as much as 100,000 miles today, now
bringing other tire issues to the forefront such as the danger
of tire degradation? The end of a tire's service life (is)
defined as when the treads wear to the 2/32-inch indicator bars
molded into the tread. However, tires on some vehicles can be
in service for many years and show little tread wear. This
prompts concerns about tires on seldom used vehicles and spare
tires."
Background . The Bureau of Automotive Repair (BAR) registers and
regulates automotive repair dealers, accepts and resolves auto
repair complaints from the public, investigates violations of
the Automotive Repair Act and, when appropriate, refers cases to
law enforcement authorities. BAR also administers a statewide
licensing program of repair facilities and service technicians
in lamp and brake inspection and repair. BAR licenses more than
34,000 auto repair dealers in California.
The Bill of Rights specifies that consumers have the right to:
select their own auto body repair shop to repair damage that is
insured, receive an itemized estimate for repairs and a detailed
invoice for completed repairs, receive information about
coverage for towing and storing services, receive information
about coverage for a replacement rental vehicle while a damaged
vehicle is being repaired, and receive information of where to
report fraud, complaints, and concerns about repairs.
Complaints concerning the repair of a vehicle by an auto repair
shop should be directed to the BAR, which is overseen by the
Department of Consumer Affairs.
The U.S. Department of Transportation's (DOT) National Highway
Traffic Safety Administration (NHTSA) sets and enforces motor
vehicle safety standards, and uses education and research to
reduce deaths, injuries, and economic losses resulting from
motor vehicle crashes. NHTSA awards grants to states to help
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them organize, develop, and implement highway safety programs.
The NHTSA has conducted multi-year research on the aging of
tires used on light vehicles (passenger cars, light trucks, and
vans) and evaluated several accelerated tire aging methods to
determine their relative effectiveness. A summary of these
findings and recommendations were documented in a report to
Congress in August 2007.
According to the NHTSA report, tire aging refers to the
reduction or loss in a tire's material properties, which over
time leads to a reduction of performance capabilities. From
1994 to 2004, NHTSA estimates that about 400 fatalities annually
may be attributed to tire failures of all types. Tire failures
can be caused by a number of factors such as under- or
over-inflation of tires, overloading of vehicles, road hazards,
improper maintenance, structural defects, improper installation,
and tire aging.
Tire aging is caused by the effect of heat and oxygen
interacting with the tire's material properties, and results in
oxidation. This process, known as thermo-oxidative degradation,
is accelerated by higher temperatures and is a contributing
factor in certain tire failures, such as tread separation. Tread
separation results from a reduction in peel (adhesion) strength
between the steel belts, an increase in hardness of most rubber
components, a loss of the rubber components' ability to stretch,
increased crack growth rates, and a reduction in tire cycles to
failure in fatigue tests. The loss of a tire's elasticity can
cause it to become dry and brittle inside, without the
appearance of visible signs of degradation. So, while tires
that have never been used before look brand new, they can be
fatally dangerous because the tire treads can, without warning,
suddenly peel off. The NHTSA's study of tires in Arizona found
that tire degradation accelerates in hotter climates. NHTSA's
analysis of data provided by a large insurance company for the
years 2002 through 2006 revealed that while 27% of its policy
holders were from Texas, California, Louisiana, Florida, and
Arizona, 77% of its tire claims came from these states and 85%
of these were for tires over six years old. Some manufacturers,
such as Ford Motors, have taken voluntary measures to retire old
tires that are at least six years old.
In its report, NHTSA states that further research on tire aging
is needed in order to decide what further steps, if any, should
be taken to address safety issues related to tire aging, and
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maintains that it is unable to isolate tire aging for motor
vehicle crashes because tire age is not coded in most crash
databases.
Since 1971, tire manufacturers have been required to place a DOT
identification code on the sidewall of a tire. The code begins
with the letters "DOT" and indicates that the tire meets all
federal standards. The next two numbers or letters represent
the plant where the tire was manufactured, and the last four
numbers represent the week and year the tire was built. For
example, the numbers 3197 means the 31st week of 1997. The
other numbers are marketing codes used at the manufacturer's
discretion. This information is used to contact consumers if a
tire defect requires a recall.
Supporters consist of a major insurance company and a law firm
that believe consumer awareness on tire degradation and average
tire shelf life will help a consumer make a tire purchase
decision and prevent accidents. Opponents consist of car
dealers and tire retailers who believe that it is difficult to
approximate a tire's expiration date and disagree on how to best
address motor safety issues.
Support . According to the AAA of Northern California and the
Automobile Club of Southern California (the AAA) clubs), "The
NHTSA has acknowledged that tires degrade throughout their life
whether or not they are in use and that tire aging is a serious
safety issue. Therefore, consumer disclosure is important to
raise awareness and to help prevent vehicle accidents caused by
tire degradation. AB 323 requires tire retailers to disclose to
consumers, in writing, the date the tire they are purchasing was
manufactured and to post, at a conspicuous place, a sign to warn
consumers that tires over six years old can degrade over time -
even if not used - and can cause sudden tire failure.
"In addition, the bill requires the current Auto Body Repair
Consumer Bill of Rights to be amended in order to include a
clause telling consumers they have the right to be informed by a
tire retailer, in writing, about the date their tires were
manufactured. The Bill of Rights is updated and produced by the
Department of Insurance and distributed by automobile insurers
to their insured (clients) at the time of application for an
insurance policy or following an accident reported by an insured
(client). These are two practical methods to inform consumers
about the important traffic safety issue of tire degradation."
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According to the Danko Law Firm, "Old tires are dangerous.
Regardless of their condition, they are prone to detreading. In
some situations, a detread can make a vehicle impossible to
control and can result in the vehicle rolling over, killing or
seriously injuring its occupants. The tire industry has been
aware of the risks for years. The public, however, generally is
not. AB 323 will increase awareness of the risks and will save
lives."
Oppose . According to the California New Car Dealers
Association, "There is no uniform fixed date for (tire)
expiration, particularly for tires that have already been
installed and used by vehicles on the road?Rather than
confronting the tough question head on by prohibiting the sale
of new and used tires beyond that date (of six years) and
addressing who recompenses dealers stuck with tires that would
have 'expired', AB 323 instead places 100% of the burden on auto
body shops, automobile tire retailers, and insurers to disclose
on a sign near a 'checkout' counter the general 800 number for
the DCA. Many service facilities do not have 'checkout'
counters to place the sign required by the bill?Rather than task
(the) Bureau of Automotive Repair with coming up with the
appropriate standards for tire age, possible removal from sale,
disclosure and penalties, AB 323 takes this issue out of the
hands of the experts?"
According to the Car Dealers Association, "Our association
members are mostly 'mom and pop' shops, catering in many cases
to lower income families who purchase used tires rather than new
ones. Some of the used tires are four, five, or six years old,
but they are safe and treadworthy. A new tire that costs over
$100 may only cost $20 used. Is it fair to these customers that
'tires older than six years can cause sudden tire failure' when
such a claim is unproven?"
According to the Les Schwab Tire Centers of California, Inc.,
"The 'warning' sign, if required, should be based upon industry
standard and scientific findings regarding tire age. Further,
it should be an 'Official State of California' sign, created and
produced by the state. The individual tire dealers should not
bear this responsibility. Complaints and questions about tires
and/or their age should be directed to the manufacturers of the
tires. Technical tire information should originate from the
manufacturer at the point of sale in the form of a manufacturer
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produced brochure, for example."
Related Legislation . AB 496 (Davis) requires auto body repair
shops to display a sign about tire degradation and to provide a
consumer disclosure notice on a tire's manufacture date that an
individual must sign. AB 496 also requires the disclosure to be
provided in six languages, makes the disclosure inadmissible in
a civil case, and fines auto body repair shops two hundred fifty
dollars ($250) for each violation.
REGISTERED SUPPORT / OPPOSITION :
Support
American Automobile Association (AAA) of Northern California
Automobile Club of Southern California (the AAA Clubs)
The Danko Law Firm
Opposition
California New Car Dealers Association (CNCDA)
California Tire Dealers Association
Les Schwab Tire Centers of California, Inc.
Analysis Prepared by : Joanna Gin / B. & P. / (916) 319-3301