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Government shutdown impacts automotive industry

Friday, January 25, 2019 - 08:00
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Embarking on the longest federal government shutdown to date, funding for Fiscal Year 2019 Transportation is just a small piece of the unfinished business that threatens all segments of the automotive and transportation industries. The standoff is between the Administration and congressional Democratic leaders over funding for the wall versus FY 2019 funding for the seven remaining appropriations bills including Transportation. This funding package alone is impacting states with highway and other projects until there is an agreement reached between the Administration and congressional leaders. 

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The federal government shutdown is just part of the dilemma faced by the automotive industry. Prior to the end of the 115th Congress, the Senate failed to consider the U.S. Senate Commerce Committee’s AV START Act, autonomous vehicle legislation. In addition to Congress not providing states a set of rules for research and implementation of vehicle technologies, more importantly for automotive repairers, the Senate bill addressed vehicle data access and cybersecurity. Without direction from Congress or the National Highway Traffic Safety Administration (NHTSA), states are left to address new vehicle technologies, data access and cybersecurity on their own. This is a segue to states filling the void for federal regulation. For local governments already faced with long-term ride-share and other new transportation regulatory decisions, the burden has become great.  

Although NHTSA, during both the Obama and Trump Administrations, has issued guidelines for new vehicle technologies — i.e. what are the roles for states and the federal government — they are only guidelines. Numerous states have initiated research and deployment rules for new vehicle technologies but the data access issue, critical to independent repairers, has been left in limbo. This federal inaction will likely lead states to attempt to address data access and related cybersecurity issues for vehicles. This has already occurred in Massachusetts, where legislation has been introduced expanding the scope of the 2013 state Motor Vehicle Right to Repair Law proposing several key changes:

  • “Mechanical Vehicle Data,” any data in a vehicle related to the diagnosis, repair or maintenance of that vehicle
  • Access to vehicle on-board diagnostic systems shall be standardized and not require the use of any authorization, directly or indirectly, by the manufacturer. Manufacturers may utilize an authorization system for access to vehicle networks and their onboard diagnostic systems that is standardized and is administered by an entity unaffiliated with a manufacturer.

Inaction at the federal regulatory level, on top of automotive issues, will lead to additional problems for the aftermarket. Without specific guidance on data access and cybersecurity or an industry agreement, repairers could face a 50-state footprint of varying regulations on access to data. This system will work against independent repairers and automobile manufacturers. Collision repairers face this regulatory model today with every state Insurance Commissioner and legislature having a shot at regulating how consumers, repairers and insurance companies interact. This system has worked against consumers and repairers. 

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