isma set to meet new epa standards for cy 2006 but says the devil is in the detail

In comments filed Jan. 18 in response to new emission regulations proposed by the Environmental Protection Agency (EPA), snowmobile manufacturers said that while the CY 2006 proposed requirements appear to be achievable, more stringent 2010 proposed standards are unnecessary and will diminish consumer choice and recreational opportunities.

Snowmobile manufacturers will work hard to meet regulations calling for a 30-percent reduction in hydrocarbons and carbon monoxide by CY2006. However, a proposal that will require an additional 20 percent reduction by 2010 is not justified and unfairly singles out the snowmobile industry, according to Ed Klim, president of the International Snowmobile Manufacturers Association (ISMA). Its members include Arctic Cat, Inc., Bombardier Inc., Polaris Industries and Yamaha Motor Corporation.

"Each of the four snowmobile manufacturers has introduced new models with low-emission-producing engines, and they will continue to develop and refine this technology," said Klim. "Such engines, however, because of their size, configuration and cost, may not be suitable for all classes of snowmobiles," Klim added.

"Forcing manufacturers to incorporate this technology into all classes of snowmobiles could jeopardize the family sport of snowmobiling, the future of the industry and the vitality of many communities where snowmobiling makes a major economic contribution." While manufacturers agree that cleaner engines will become standard for many classes of snowmobiles over the next decade, the technology is not compatible with models that have unique or particularly demanding performance requirements. Other models are produced in volumes too small to make it economically feasible to incorporate the new technology, particularly in the virtual absence of demonstrated ambient air quality benefits associated with such an investment, according to ISMA.

Klim said that every snowmobile manufacturer has been working to establish a reasonable emission rule with the EPA since 1994, when the manufacturers first hired Southwest Research Institute to proactively help the EPA develop correct emissions data on snowmobiles. According to Klim, there are no research findings that snowmobiles have a significant effect on ozone in the atmosphere. Moreover, snowmobile emissions do not cause carbon monoxide air quality violations in non-attainment areas, which are typically major metropolitan cities.

"The EPA proposal is being driven by national ambient air quality standards that are not even impacted by snowmobiles. The legal basis for regulating snowmobile engine emissions under the Clean Air Act is therefore highly questionable," said Klim. In its comments to the EPA, ISMA pledged its support for a properly-tailored regulatory program that recognizes the many unique factors that distinguish snowmobiles as a regulated category.

"It's ironic that the proposal for regulating snowmobile engine emissions contains more rigorous and potentially more expensive testing and compliance programs than the agency requires of cars and other regulated categories," said Klim. "It would be more appropriate to apply a freshly designed, more streamlined regulatory structure to the snowmobile category. Standards should reflect the relatively low volume of snowmobiles, their relatively low use and the locations where they are used."

The enjoyment of snowmobiles, of course, requires the cooperation of Mother Nature, more so than virtually any other recreational product. This has long presented an added challenge to expanding the customer base, said Klim. This also underscores the close relationship between sales and increases in product and development costs, such as those associated with low-emission technology.

Higher Costs Impact Sales

ISMA has retained the prominent Cambridge, Mass.--based National Economic Research Associates (NERA) to study the potential impact of the new EPA proposal on snowmobile sales. Preliminary results indicate that significant price increases resulting from the cost of technology required to meet the proposed new EPA standards will reduce the market for snowmobiles. These preliminary results reflect the discretionary nature of snowmobile purchases and high sensitivity to price, particularly in the long run. Due to their small sales volume, snowmobiles are more price sensitive than autos and other motorized recreational vehicle industries with greater economies of scale. In 2001, 140,000 snowmobiles were sold in the United States - compared to 16,000,000 automobile sales.

ISMA supports the regulation calling for full compliance by CY 2006 if the proposal can be streamlined to avoid unnecessary and duplicated testing and other inappropriate program costs can be controlled.

Snowmobiles produced prior to the effective date of the proposed standard would not be affected and would remain legal to own and operate. The EPA typically allows several years of lead-time between publication of final rule and effective date of the new standard. The snowmobile manufacturers would be responsible for ensuring their new products are in compliance once the standard takes effect.

"Our industry has proactively pursued cleaner fuel burning engine technologies that meet ever-increasing environmental standards without sacrificing the fun and performance of snowmobiles," said Klim. "As these new models are phased into production, it's important to establish standards and realistic implementation timetables that keep snowmobiles affordable to American customers.

Snowmobiling generates winter tourism income that is vital to hundreds of rural communities and employment throughout the Snowbelt. "Similar concerns have been addressed in rulemaking for other industries," said Klim. "The same approach should be applied to our industry as well."