Replica Car Manufacturing Jumpstarted by NHTSA Rulemaking

Arent Fox
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Arent Fox

The National Highway Traffic Safety Administration (NHTSA) implemented a new regulation permitting low-volume automobile manufacturers to construct and sell limited numbers of replica vehicles, subject to intellectual property, safety, and configuration requirements.

Background

Since 2011, the Specialty Equipment Market Association (SEMA) and other industry entities have pressured Congress for exemptions allowing small companies to produce and sell a limited number of replica vehicles. These efforts culminated in the passage of the Fixing America’s Surface Transportation Act (FAST) in 2015, which created an exemption for low-volume automakers to construct and sell up to 325 replica vehicles in the U.S. each year subject to regulatory oversight. The Act defines replica vehicles as motor vehicles that resemble cars produced 25 years ago or more.

Despite the Act’s passage in 2015, the NHTSA did not issue the final rule until earlier this year, following a 2019 SEMA-backed lawsuit against the NHTSA compelling the Act’s implementation.

Not So FAST: FAST Act Requirements for Low-Volume Replica Car Manufacturers

The Act imposes a series of requirements on replica vehicles produced under the exemption. To be eligible under the FAST Act’s exemption program, replica car manufacturers must be in compliance with the following:

  • Intellectual Property Rights. Replica car manufacturers must obtain all intellectual property rights necessary to produce the vehicles, including but not limited to product configuration, patent, trademark, and/or trade dress rights. Further, while replica manufacturers are not required to submit documentation demonstrating their ownership or license in the applicable intellectual property, they must nonetheless certify that the replica will be manufactured under the appropriate intellectual property licenses.
  • Resemblance. Replica vehicles must only resemble the original vehicle’s exterior design; they need not resemble the original interior.
  • Volume Limits. Under the Act, replica manufacturers may only produce a maximum of 325 replica vehicles in the U.S. per year.
  • Size Requirements. Replica vehicles must be reproduced on a 1:1 scale, plus or minus 10%, excluding configuration, ride height, body trim, fenders, grills, hoods, running boards, windows, and axel location. Variations in size are subject to NHTSA approval on a case-by-case basis.
  • Safety Requirements. Replica vehicles must generally comply with applicable Federal Motor Vehicle Safety Standards (FMVSS), though the Act provides narrow carve-outs for FMVSS Nos. 108 and 205 to accommodate technical and financial practicalities. Notably, the Act expressly preempts state safety laws covering replica vehicles.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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