Terminology

Early Warning Reporting (“EWR”): In response to the requirements of the Transportation Recall Enhancement Accountability and Documentation Act (“TREAD Act”), NHTSA issued rules requiring that motor vehicle and equipment manufacturers provide communications regarding certain early warning data. Quarterly reporting of early warning information: production information; information on incidents involving death or injury; aggregate data on property damage claims, consumer complaints, warranty claims, and field reports; and copies of field reports (other than dealer reports) involving specified vehicle components, a fire, or a rollover.1

Environmental Exposure and Corrosion (“EEC”): Stout’s analysis of component failures related to environmental factors examines recalls where various environmental or climate related conditions are identified in the defect descriptions. We have isolated those defects with descriptions including: climate, environmental, corrosion, debris, salt, moisture, or intrusion.

Federal Motor Vehicle Safety Standards (“FMVSS”): NHTSA has a legislative mandate to issue FMVSS and regulations to which manufacturers of motor vehicles and items of motor vehicle equipment must conform and certify compliance. The FMVSS are minimum safety performance requirements, specified in such a manner that the public is protected against unreasonable risk of crashes occurring as a result of the design, construction, or performance of motor vehicles and is also protected against unreasonable risk of death or injury in the event crashes do occur.2

Integrated Electrical Components (“IECs”): Failure of electrical components due to physical defect. Includes defects related to water intrusion, wiring failure, etc.

Motor Vehicle Defect Petitions (“MVDPs”): Under the Safety Act, the public has the ability to petition NHTSA to open an investigation into a suspected defect or determine whether a manufacturer has appropriately conducted the recall notification and remedy process.

National Highway Traffic Safety Administration: The National Highway Traffic Safety Administration (“NHTSA”), under the U.S. Department of Transportation, was established by the Highway Safety Act of 1970, as the successor to the National Highway Safety Bureau, to carry out safety programs under the National Traffic and Motor Vehicle Safety Act of 1966 and the Highway Safety Act of 1966.

NHTSA Investigation: NHTSA technical staff conducts analysis of owner questionnaire data, in combination with other available or requested information, to determine whether an unusual number of complaints of potential safety-related issues have been received in relation to specific vehicles, components, or equipment.

NHTSA Safety Recall: A recall is issued when a manufacturer or NHTSA determines that a vehicle, equipment, car seat, or tire creates an unreasonable safety risk or fails to meet minimum safety standards. Manufacturers are required to fix the problem by repairing it, replacing it, offering a refund, or in rare cases repurchasing the vehicle.3

Operability: If a defect limits the usability or operability of a vehicle, the owner is more likely to pursue a repair. Stout has analyzed defect data based upon the following operability conditions:

  • Operable: A defect in the identified component would not be likely to be noticed or impact day-to-day function of the vehicle;
  • Limited: The vehicle can still operate, but a significant defect will likely be noticed by the driver; and,
  • Non-Operable: The vehicle likely cannot be driven due to a defect in this component.

Part 573 Safety Recall Report (“573 Letter”): For each recall initiated in the United States, OEMs are required to submit a Part 573 Letter that serves as notification to the U.S. Department of Transportation and NHTSA that a defect related to motor vehicle safety or noncompliance with Federal Motor Vehicle Safety Standards exists. Required sections of report include: Manufacturer, Designated Agent and other Chain of Distribution Information; Identification of the Recall Population and its Size; Description of the Defect or Noncompliance and Chronology of Events; Remedy Program and Schedule; and Manufacturer of Defective Component.

Petition for Inconsequential Noncompliance (“PIN”): Manufacturers can petition NHTSA to alert them of a potential violation or defect that the manufacturer believes is an inconsequential issue that does not pose a safety risk. The existence of these defects may be determined by the manufacturer or by an initial determination of NHTSA’s. By NHTSA’s grant of a petition, the manufacturer is relieved of any further responsibility to provide notice and remedy the defect or noncompliance. A denial will continue to enforce all duties of the manufacturer relating to notice and remedy of the defect or noncompliance

Quarterly Progress Reports (“QPR”): NHTSA requires that beginning the quarter after the start of a recall, the manufacturer must submit a Quarterly Progress Report for six consecutive calendar quarters. The deadline for the report is the 30th day of the month following the quarter’s end.

Remedy Completion Percentage: The proportion of vehicles in the recall population that have been remedied, inspected without needing remedy, or returned to inventory. U.S. recall completion percentage data is reported by manufacturers Recall Quarterly Reports (Quarterly Progress Reports, or “QPRs”).

Software Defect: Failure of components related to defect in operating software

Software Integration: Failure results from software interfacing with other components or systems in the vehicle

Software Remedy: Software flash or replacement is identified as the appropriate defect remedy

Technical Service Bulletins (“TSBs”): NHTSA maintains a database of technical service bulletins, which contain service procedures issued by OEMs to service technicians for the diagnosis and repair of known defects. Defects identified by TSBs are often those that do not rise to the level of a safety recall. Defects identified in TSBs may subsequently result in recalls.


1 Federal Register, Early Warning Reporting Regulations
2 U.S. Department of Transportation, National Highway Traffic Safety Administration, Quick Reference Guide (2010 Version) to Federal Motor Vehicle Safety Standards and Regulations
3 NHTSA Safety Issues & Recalls

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