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SEMA files lawsuit against NHTSA over failure to implement replica car rules

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Photo courtesy DeLorean Motor Company.

At least one carmaker that had planned to build turnkey replica vehicles under the Low Volume Motor Vehicle Manufacturers Act has already thrown in the towel due to inaction from the National Highway Traffic Safety Administration, and now the Specialty Equipment Market Association has made good on its threat to sue the federal agency to spur it into action.

“There’s been no accountability” from the NHTSA, said Stuart Gosswein, SEMA’s senior director of Federal Government Affairs. “They’ve said they were close to a proposed rule, but we’ve seen not a shred of it from them.”

The lawsuit, filed Thursday in federal appellate court, asks the court to compel the NHTSA to issue replica car guidelines that, under the Low Volume Motor Vehicle Manufacturers Act, were supposed to have been submitted in December 2016.

As outlined in the law, passed in December 2015 as part of a highway funding bill, replica cars – previously unable to be sold with complete drivetrains because they would thus fall under the same safety and emissions testing as brand-new vehicles – could be sold as turnkey vehicles, provided that the replica carmakers (companies that build less than 5,000 cars per year) use EPA- or CARB-certified current model year engines and limit their output to 325 cars per year. While those two agencies have submitted guidelines and regulations, as the legislation ordered, the NHTSA has failed to comply.

“After we threatened to file the lawsuit last year, the people at the NHTSA said, ‘hold off, give us a few weeks, we’re close to a proposed rule,'” Gosswein said. “But then they didn’t get us anything.”

According to Gosswein, even the sponsors of the original bill, among them Markwayne Mullin of Oklahoma and Gene Green of Texas, got generic responses from NHTSA leadership when they asked for updates on the agency’s regulatory process.

In the meantime, according to a SEMA press release about the lawsuit, the dozen or so companies and replica car projects that planned to take advantage of the law have had to either set aside or scale back those plans.

“Companies have not hired workers, businesses have lost money, and consumers have been denied their rights to purchase replica cars,” SEMA President Chris Kersting said in the press release.

Earlier this year, Craig Corbell scuttled his plans to build a Cord replica and put the Cord trademark up for sale in part because of the NHTSA’s delay. “Until we get all the information from the government, I don’t want to get a long way toward getting stuff made and then have to do something different,” he said.

Former race team owner Charley Strickland hasn’t yet given up on his plans to build a replica Lamborghini Countach – one that’s already designed, prototyped, and ready for production – but said he has lost funding for the project entirely due to the NHTSA’s delays.

“I’ve done the proof of concept, but without further funding it will not exist, and I won’t get the funding as long as people are clueless about the Low Volume act and whether I can build it,” he said. “I’m the only one whose eat, breathed, and lived the Low Volume act for the last three years, and I’m the only one who it’s life or death to.”

Other companies interested in building replica cars under the act have found it difficult to keep suppliers on hold as well. Jim Espey, vice president of the De Lorean Motor Company, noted two years ago that he’d already missed windows for long-lead tooling necessary to begin production of replica DeLoreans. “The supplier said ‘Are you real, or are you jerking us around?’” he said.

The lawsuit, filed in the Ninth Circuit Court of Appeals in California, names Elaine Chao, the secretary of transportation, the U.S. Department of Transportation, and James Owens, the acting administrator of the NHTSA. SEMA asks in the lawsuit that NHTSA act “so that manufacturing can begin as soon as possible.”

The NHTSA, via a spokesperson, declined an interview request for this story.