Feds in sync with industry on autonomous cars

on Sep16

Transportation Secretary Elaine Chao, speaking in Michigan on Tuesday, outlined the Trump Administration’s autonomous vehicle policy. Photo credit: Jackie Charniga

WASHINGTON — From a regulatory standpoint, September has been a good month so far for U.S. automakers and tech companies racing to develop autonomous vehicles.

The House of Representatives passed the SELF DRIVE Act, the Senate Commerce Committee floated a draft bill that soon will become an official proposal, and the Department of Transportation issued revised industry guidance on how the federal government will treat safety compliance in the brave new world of driverless cars.

The three efforts reflect the politically conservative tendencies of the Trump administration and Congress in projecting a hands-off approach to establishing a legal and regulatory framework for self-driving vehicles, and they promise to deliver much of the regulatory certainty and consistency sought by the industry.

Safety groups complain that the proposals give the industry too much leeway to ignore risks, but some experts say the government approach recognizes that private-sector competition will drive safety improvements faster than regulators who might overlook potential solutions when prescribing rules.

“You’re seeing a light regulatory touch to encourage innovation and prevent the government from picking winners and losers,” said Tim Goodman, a transportation safety attorney at Babst Calland. He also was assistant chief counsel for enforcement at the National Highway Traffic Safety Administration until April 2016.

“Pursuing a market-based approach allows companies to take advantage of efficiencies” and promote safety, he added.

Framing the rules

Through this process, the boundaries between federal and state jurisdiction are taking shape, though they could be challenged over time. All three policy prescriptions include language that would pre-empt states from setting autonomous vehicle design, construction and performance standards during testing, leaving that to NHTSA. States would focus on traditional responsibilities such as licensing, registration, insurance and enforcement of traffic laws.

Both pieces of legislation also accede to industry requests for greater exemptions from existing motor vehicle safety standards, which developers argue is crucial for validating their technology and encouraging investment. Each automaker would be conditionally allowed up to 100,000 vehicles per year (up from 2,500 today), phased in over several years, that don’t meet the standards.

The Transportation Department guidelines say autonomous vehicle developers don’t need to obtain pre-deployment approval from regulators for operating self-driving vehicles on the road. The congressional bills similarly call for automakers to provide reports evaluating the safety of their technology, but not as a pre-approval step.

Advocates for Highway and Auto Safety said more stringent regulation is needed “so that our roads do not become deadly proving grounds for autonomous vehicles.” It pointed to a fatal 2016 crash involving a Tesla Model S operating on Autopilot as an example of what can happen with lax oversight. The National Transportation Safety Board released findings last week that Tesla’s Autopilot system was a contributing factor in the driver’s death because it facilitated inattention and operated outside its designed capabilities.

The House and Senate proposals also would create a technical safety committee on highly autonomous vehicles with experts representing a range of stakeholder interests to provide input to the Transportation Department, and both would require manufacturers to have written plans for identifying and reducing cybersecurity risks.

The House version notably would begin regulation with partially automated vehicles (Level 2) that have driver-assist features such as lane-keeping assistance, while the Senate draft defines autonomous vehicles as Levels 3 to 5.

Under NHTSA’s classification system, Level 3 vehicles operate with minimal human intervention.

Automakers “don’t like including Level 2 because those vehicles are already on the road, and retroactive policy creates complications for consumers,” said Gloria Bergquist, vice president of communications and public affairs for the Alliance of Automobile Manufacturers.

Senate Commerce Committee Chairman John Thune, R-S.D., also is considering extending the autonomous vehicle legislation to include heavy trucks, according to the draft bill.

Role of guidelines

The guidelines under Transportation Secretary Elaine Chao are more streamlined than the voluntary best practices put forth in September 2016 by the Obama administration, which was over 100 pages. The new version is one-third the size.

The previous guidelines had lengthy checklists of steps the department ideally wanted developers to take before testing an automated vehicle on public roads, which the industry viewed as heavy-handed given the nascent stage of autonomous vehicle technology.

The new document provides more flexibility, using language such as “we envision” and “we promote” to encourage manufacturers to follow certain test practices without clearing a lot of regulatory hoops.

Goodman, the former NHTSA official, said the guidance takes a “wait and see” approach because the department wants to see how it will be instructed to act by Congress. The guidance fills the void until the rule-making process kicks in to set motor vehicle safety standards for self-driving cars.

“Remember, these are not rules. These guidelines signal the way the DOT is headed, and my expectation is you’ll see numerous rule-makings that implement individual guidelines” in coming years, said Tim Bransford, a partner in the technology and automotive groups at law firm Morgan Lewis.

Underscoring the voluntary nature of the guidelines is the fact that automakers don’t appear to be fully taking the recommendations to heart, especially when it comes to providing safety assessments, Bransford said.

The National Safety Council expressed disappointment in a statement that the “DOT has yet to receive any safety assessments. … Voluntary guidelines will serve the developers of new technologies to ensure they can move quickly, but they serve public safety best if all the players agree to comply with them.” The group called on Congress to mandate additional safety measures such as robust validation processes before deployment and data-sharing requirements.

Bransford said the guidelines are also notable in that they do not try — for now — to regulate ethical judgments typically made by a driver, such as how autonomous vehicle software prioritizes a vehicle’s direction to avoid a collision and what objects are determined as more suitable to strike. Observers say they expect the guidelines to be updated frequently (the Transportation Department says it’s already working on the next version for next year) and that rule-makings eventually will replace and codify the government’s safety expectations.

Auto interests are cautiously optimistic Congress will pass a final bill governing autonomous vehicle testing this year given the bipartisan support in both chambers. However, the remaining days on the legislative calendar are limited, and the leadership is expected to focus much of its attention on tax reform and a package of immigration and border security policies, which could push a final vote into next year.

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