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The National Highway Traffic Safety Administration ('''NHTSA''', often pronounced "nit-suh") is a U.S. Government agency, part of the Department Of Transportation , responsible for setting safety standards and verifying compliance by automobile manufacturers. It also issues Recall notices that ensure full awareness of mechanical problems with cars sold in the US, and publishes the results of safety tests of various automobiles, to allow buyers to evaluate the anticipated behavior of an automobile in a crash. HISTORY In 1958, the UN established the World Forum For Harmonization Of Vehicle Regulations . This development was not noted in the United States at the time, but vehicles meeting these established safety standards were legal to import into the United States. In 1965 and 1966, public pressure grew in the US to increase The Safety Of Cars , culminating with the publishing of Ralph Nader 's book '' Unsafe At Any Speed '', and the National Academy Of Sciences ' "Accidental Death and Disability - The Neglected Disease of Modern Society". In 1966, Congress held a series of highly publicized hearings regarding highway safety, and passed legislation to make installation of Seat Belts mandatory, and created several predacessor agencies which would eventually become the NHTSA, including the National Traffic Safety Agency, the National Highway Safety Agency, and the National Highway Safety Bureau. The NHTSA was officially established in 1970 by the Highway Safety Act of 1970. In 1972, the Motor Vehicle Information and Cost Savings Act expanded NHTSA's scope to include consumer information programs. Since this era, automobiles have become far better in protecting their occupants in vehicle impacts. The number of deaths on American highways hover around 40,000 annually, a lower death rate per mile travelled than in the 1960's. NHTSA has conducted numerous high-profile investigations of Automotive Safety issues, including the Audi 5000/60 Minutes affair and the Ford Explorer Rollover problem. Consumers today have a far greater amount of auto safety information available, due to the efforts of NHTSA and the Insurance Institute For Highway Safety . BORN FROM OLIGOPOLY In the era when NHTSA began, a commonly repeated saying in the US auto industry was "safety does not sell." From a modern perspective, this seems unusual, since auto manufacturers now prominently feature safety features and positive safety ratings in their Advertising , but the automobile market in the US at this time in history had some unusual characteristics. At the time NHTSA was established, the US auto market was an Oligopoly , with just three companies controlling 85% of the market. These auto makers were each producing basically the same car with minor styling variations. These Manufacturers were isolated from both Imports and Exports of vehicles by producing extremely large, uneconomical Automobiles , unsalable in most other nations. In Economics , Oligopoly is a type of Market Failure . US manufacturers (which had innovated the Automatic Transmission , Air Conditioning , and Power Steering in the Post-War years) suddenly realized that any innovation - Safety or otherwise - would be Unprofitable . Without choices that include Superior products, Consumers effectively have no choice. The major Car Safety Innovations of the 20th century, like Roll Cage construction, Seat Belts , Disk Brakes , Anti-lock Brakes , and Traction Control , were therefore developed abroad in response to Competitive market forces in those territories. Government Agencies have a modest record of success in the area of Innovation and breakthrough design, but they are widely perceived as good at establishing minimum acceptable standards. Faced with this situation, the normally Free Market Capitalist Americans sought government help. Car manufacturers appeared to be forcing unsafe cars on Americans. Some saw parallels to the 1906 case of Upton Sinclair and Meatpacking . Command And Control legislation appeared to many to be a wise course of action at the time. This move was Controversial , with other Americans feeling that if a certain passenger vehicle is not safe, the consumer is perfectly free not to purchase it. They would point to Volvo , which equipped its cars with Seat Belts beginning in 1959, and was available to Americans. The real Market Failure in this view was the lack of safety information. Other than providing this information, the government has no role. The Command And Control group won this argument and NHTSA reflects this view. Cars that fall outside of NHTSA regulations are actually Illegal for Americans to possess. Today the US auto market has fragmented and is far more Competitive , leading to advances in Car Safety , technological Innovation , and Price Competition . UNINTENDED CONSEQUENCES Design legislation led to many unintended consequences, especially in the early days of NTHSA. Many of these spring from the fact that Americans in the 1960's, 1970's, and early 1980's often preferred not to wear Seat Belts - yet these were single most important saftey device ever created. NHTSA struggled with this fact and came up with the seatbelt interlock in 1974, that prevented the car from starting unless the occupants were belted. The interlock provoked such an uproar that it was quickly pulled from the market. Also in 1974, NHTSA banned the Citroen SM automobile, which contemporary Journalists noted was one of the safest vehicles available at the time, due to an non-safety related design issue. The law under which the SM was banned was repealed in 1981. Ford reintroduced a similar powered suspension system to the US market in 1988 in one of its Lincoln models. NHTSA also administers the controversial Corporate Average Fuel Economy (CAFE) program. The Wall Street Journal and others have argued that this program distorts market Incentives , forcing people to buy smaller, less safe vehicles. CAFE may indeed be a driving factor behind the explosion in demand for SUV s, which are considered "light trucks" for CAFE purposes and therefore do not have to meet the stricter standards for vehicles classified as "cars." The counter argument is that politically reflecting the actual cost of Oil and its Externalities to the US Consumer is not politically feasible. AERODYNAMICS BRINGS CHANGE TO NHTSA In the 1980's, NHTSA suddenly faced a conflict between its mission to enforce the laws Congress had mandated on automobiles and it's objective to increase vehicle Fuel Economy . Ford , a major U.S. car company, wished to introduce the first Aerodynamically designed American family sedan as a 1986 model - the Ford Taurus . The design of this vehicle would not achieve decent Aerodynamic performance if forced to comply with the 1937 regulation on automobile Headlights then in force and administered by NHTSA. With the lobbying muscle of Ford , a change in the Headlight law was finally enacted. THE GREY MARKET The United States has chosen to make is Automobile Design Regulations incompatible with those of other industrialised nations, such as the European Union and Japan . Since NHTSA regulations have no provision for equivalency, and full NHTSA type approval costs approximately $2 million, the availability of some cars to American consumers is restricted. This particularly impacts low volume manufacturers. Because of the unavailability of certain cars, the Grey Market for vehicles arose in the late 1970's. This provided an alternate method to acquire these vehicles, and still obtain NHTSA certification. The success of the grey market, however, ate into the business of Mercedes-Benz of North America Inc, which launched a successful congrssional lobbying effort to eliminate this alternative in 1988. It is no longer possible to import a non-US vehicle into the United States as a personal import, with one exception. In 1998, NHTSA granted vehicles over 25 years of age dispensation from the rules it administers, since these are presumed to be collector vehicles. SEE ALSO
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