Staff Contact: William F. Mascaro Telephone (703) Item Description Class

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1 Re: Pneumatic Tires Staff Contact: William F. Mascaro Telephone (703) Proponent: Commodity Classification Standards Board Present Classification Provisions Item Description Class PLASTIC OR RUBBER ARTICLES, OTHER THAN EXPANDED, GROUP: subject to item Tires, pneumatic, NOI; see Notes, items and NOTE Tires may have steel bead locks inserted, may be mounted on steel rims or may contain flaps, inner tubes, reliners or valves NOTE Tubeless tires (tires not employing tubes for retention of air) weighing each 700 pounds or more must have labels or placards attached by shipper to each side of tire warning against improper handling and stating methods of proper handling. Labels or placards must be printed in type not less than one-half inch in height Tires, pneumatic, used or defective; or Scrap Rubber Tires, having value only for reclamation of raw materials; see Note, item , actual value not exceeding $1.00 per pound, see Note, item NOTE Shipper must certify on shipping orders and bills of lading at time of shipment that the actual value per pound of the property does not exceed $1.00. If the shipper fails to so certify the actual value per pound, the tires will be classed per item , , or , with the final determination of item dependent on the type of tire. RUBBER MATERIALS GROUP: subject to item Rubber, scrap, NOI, see Note, item , in packages NOTE Applies only on: scraps, pieces or trimmings of rubber-impregnated cloth; reclaimers' tailings or residue; old worn-out rubber boots, shoes, belting, clothing, rolls or rollers, hose mats, matting or packing; or similar worn-out articles; having value only for reclamation of raw materials. Such articles must be described on bills of lading and shipping orders at time of shipment as 'Scrap Rubber.' Does not apply on scrap rubber tires. Provisions for such tires are found in item National Motor Freight Traffic Association, Inc. Subject 1, Page 1 of 8

2 Proposed Classification Provisions Item Description Class PLASTIC OR RUBBER ARTICLES, OTHER THAN EXPANDED, GROUP: subject to item Tires, pneumatic, other than mounted on wheels, see Notes, items A-NEW and A-NEW NOTE For provisions applicable to pneumatic tires mounted on wheels, see items 12420, , and , with the final determination of item dependent upon the involved wheel and tire combination NOTE Cancel; no further application NOTE No Change Tires, pneumatic, used or defective; or Scrap Rubber Tires, etc... Cancel; see items and B-NEW NOTE Cancel; see item C-NEW. RUBBER MATERIALS GROUP: subject to item Rubber, scrap, NOI, see Note, item , in packages... No Change NOTE Applies only on: scraps, pieces or trimmings of rubber-impregnated cloth; reclaimers' tailings or residue; old worn-out rubber boots, shoes, belting, clothing, rolls or rollers, hose mats, matting or packing; or similar worn-out articles; having value only for reclamation of raw materials. Such articles must be described on bills of lading and shipping orders at time of shipment as 'Scrap Rubber.' Does not apply on scrap rubber tires. Provisions for such tires are found in item B-NEW. WASTE MATERIALS GROUP: subject to item B-NEW Tires, rubber, scrap, having value only for reclamation of raw materials, actual value not exceeding $1.00 per pound, see Note, item C-NEW C-NEW NOTE Shipper must certify on shipping orders and bills of lading at time of shipment that the actual value per pound of the property does not exceed $1.00. If the shipper fails to so certify the actual value per pound, the tires will be classed per item , , or , with the final determination of item dependent on the type of tire. Analysis This proposal is based on information developed through Research Project 1101 involving tires. Project 1101 was initiated in response to indications of transportation characteristics inconsistent with CCSB guidelines for the currently applicable class 77.5 per item , Tires, pneumatic, NOI, as shown in the present classification provisions. A proposal on this matter was initially considered by the CCSB during its public meeting on January 24, That proposal, designated as Docket , Subject 3 was withdrawn in response to comments from interested parties in attendance at the meeting and due to an error with the proposal notifications. Subject 1, Page 2 of National Motor Freight Traffic Association, Inc.

3 Provisions for pneumatic tires were adopted from the rail classification in 1936 at a rating equivalent to class 85. Since that time, the provisions for tires in the NMFC have been the subject of numerous proposals to raise or lower the applicable class and to address interpretative issues. The currently applicable class 77.5 in item was established as a result of action taken on Docket 142, Subject 12 (September 1969) and first appeared in Supplement 7 to NMFC A-11, effective September 2, Since that time, there have been other proposals to raise or lower the class applicable to pneumatic tires but none have been adopted. During the course of Project 1101 the CCSB contacted four trade associations and 161 potential manufacturers or shippers of tires in August and December of From this sampling, one association responded that they did not represent shippers of tires. No response was received from the other three associations. Of the 161 potential manufacturers or shippers contacted, 24 of the surveys were returned as undeliverable, 13 companies responded that they did not manufacture or ship tires, and 8 companies provided some information. Additional information was developed through carrier-submitted Shipment Information Forms, CCSB dock surveys and the CCSB s Density Study 1. Overall, the information developed encompasses a wide variety of pneumatic tires, including, but not limited to, aircraft tires, automobile tires, truck tires, motorcycle tires, and offroad tires. Where identified, information involving tires mounted on wheels has been excluded as these articles are classified elsewhere in the Classification. Examples of the types of tires on which information is available are depicted in the photos below. In addition to the different types of tires, the record also includes used or defective pneumatic tires named in item as these tires are similar in nature to the pneumatic tires named in item The Density Study is part of an ongoing effort by the CCSB to collect information on actual shipments; it is not tied to any particular research project, nor does it target any particular product category. Carriers that choose to participate in the study periodically submit shipment data captured through their respective freight auditing programs. The data is identified by NMFC item, and only verifiable data points, which include the weight and the dimensions and/or cube of the shipping unit involved, are used National Motor Freight Traffic Association, Inc. Subject 1, Page 3 of 8

4 % of Figures in Interval CCSB DOCKET Transportation Characteristics Since the preparation of the initial proposal on Docket , the CCSB has continued to gather information on the transportation characteristics of pneumatic tires. The updated information has been incorporated into the record for this proposal. Density: Overall, the information of record now encompasses 5,806 density observations and reveals a range in density from 0.27 to pcf, with a simple average density of 9.34 pcf. A frequency distribution of the overall density range is provided below. Frequency Distribution Density Intervals (pcf) As depicted in the graph, the density observations are distributed throughout the identified density range, with the greatest concentration of figures in the 6 but less than 8 pcf interval. When evaluated on the basis of how they are tendered for shipment, when known, loose tires range from 0.27 to pcf and exhibit an average density of pcf, while tires tendered in packages range from 3.06 to pcf, with an average density of 9.07 pcf. Stowability: Pneumatic tires are tendered for shipment in a variety of ways, including loose, loose on pallets, stretch-wrapped on pallets, banded on pallets, and in boxes or reusable shipping containers. It should be noted, however, that only five shipments of record were reported to be in boxes and four in reusable shipping containers. When tendered on pallets, whether or not secured to the pallet, pneumatic tires will generally require floor loading. Also, given the general elastic or flexible nature of pneumatic tires, it is likely that additional freight will not be able to be loaded on top of the tires, thereby rendering the space above unusable, absent the use of load decks or load bars, and making it Do Not Double Stack Subject 1, Page 4 of National Motor Freight Traffic Association, Inc.

5 more difficult to structure a load. In addition, palletized shipments may not occupy the full area of the pallet deck, or the tires may overhang the edges of the pallet deck. When the tires fail to occupy the area of the pallet deck, there may not be any lateral support for adjacent freight. When the tires overhang the edges of the pallet, additional care and attention may be required to ensure that only compatible freight is loaded adjacent to the tires to prevent damage. Tires tendered loose may be stacked or interlaced within the vehicle. Again, floor loading is generally required, and when stacked or interlaced, any remaining space above the tires is essentially unusable due to the tires inability to support other freight. Such shipments may also require the use of load bars or dunnage to prevent movement of the tires during transit. Loose tires loaded on edge will also require the use of dunnage or some type of bracing to prevent movement within the vehicle. As is the case with other shipping methods, pneumatic tires loaded in this manner will also severely limit the carrier s ability to use the surrounding vehicle space, especially on top. Handling: When tendered unitized to a pallet, pneumatic tires may be handled in a manner similar to other like-packaged freight, however, extra care and attention will be required when the tires overhang the edges of the pallet to prevent damage. When placed or stacked on a pallet without banding or stretch wrap being used to secure the tires to the pallet, extra care and attention may be required to avoid having the tires fall from the pallet while loading and unloading and during cross-dock operations. Pneumatic tires tendered loose will require extra time when loading, unloading and during cross-dock operations. Interlacing or stacking loose tires in a vehicle will require additional time, not only to interlace or stack the tires in the vehicle, but also to secure them with load bars or bracing. The use of additional personnel may also be required to complete these activities in a timely manner. Positioning the tires within the vehicle may also take additional time and personnel as dunnage and/or compatible freight may be required to support the tires in the vehicle. These activities are not required for most other types of general commodities National Motor Freight Traffic Association, Inc. Subject 1, Page 5 of 8

6 In some instances, carriers must also sort and segregate loose tires for delivery to multiple locations. Information of record indicates that loose tires may provide a manufacturer s label that identifies the manufacturer, tire name and size, but frequently no shipping information. Larger loose tires, such as those for off-road use, generally do not have any labels attached and often lack the appropriate shipping information on the tire. This is contrary to the requirements of Item (Rule) 580, Marking or Tagging Freight, which stipulate that each package, bundle or loose piece of freight in a shipment must be marked by the shipper with the name and address of the shipper and also only one consignee at one address to which the package, bundle or loose piece of freight is destined. Larger and heavier tires, such as those found on heavy-duty off-road vehicles or equipment, will also require additional care and attention when handling. Information developed indicates that these tires are typically tendered loose, and due to their size and weight, will most likely require mechanical handling equipment. Such tires, however, have to be handled with extra care to prevent damage to the bead or other surfaces 2. Positioning these tires in the vehicle is also more difficult than other general commodities and may require extra personnel to assist. For example, as depicted in the photo on the right, this loose tire had a reported weight of 1,407 pounds and would require the use of mechanical equipment to move. When handling such a tire, extra care would have to be exercised to not only prevent damage to the tire, but also to prevent the tire from falling or rolling off the forklift tines during cross-dock operations. Liability: Tires are not perishable, prone to spontaneous combustion or explosion, or susceptible to theft. They may be susceptible to damage; however, this susceptibility will vary depending on the manner in which the tire is tendered for shipment. Information of record indicates that the manner of tender for pneumatic tires varies from in boxes or reusable shipping containers, stretch-wrapped or banded to a pallet, or loose. As is the case with most general commodities, pneumatic tires tendered fully enclosed within a box or reusable shipping container, while not found to be typical, will be afforded greater protection against damage than when tendered stretch-wrapped or banded to a pallet, and especially compared to loose tires. It is noted, however, that while claims for loss or damage have been reported, there is no information on the record that would indicate an unusual claims problem. A limited amount of information on value indicates a range from $1.67 to $4.30 per pound, with a simple average value of $2.99 per pound. 2 Note, item addresses this issue by stipulating that tubeless tires weighing each 700 pounds or more must have labels or placards attached by the shipper to each side of the tire warning against improper handling and stating methods of proper handling. This Note would continue to be referenced in item Subject 1, Page 6 of National Motor Freight Traffic Association, Inc.

7 Relationship to CCSB Policies and Guidelines CCSB policy calls for classification provisions to be as clear as possible to help preclude interpretation disputes. Item currently provides for used, defective or scrap rubber tires. From the carriers standpoint, verifying whether a particular tire shipment consists of defective tires or new tires can be difficult at best. In addition, the transportation characteristics of new, used or defective pneumatic tires will be essentially the same, with little or no difference in the density, and the same handling and stowing considerations. In view of this, cancelling the provisions for used or defective pneumatic tires in item with reference to the provisions of item , as proposed, is in keeping with CCSB policy and precedent. CCSB policy calls for classification provisions to reflect a commodity s known transportation characteristics. Information of record indicates that pneumatic tires have a range in density from 0.27 to pcf, with a simple average density of 9.34 pcf. CCSB guidelines for the currently applicable class 77.5 for pneumatic tires as named in item and the class 60 applicable to used or defective pneumatic tires as named in item call for a minimum average density of 13.5 and 30 pcf, respectively. Under CCSB guidelines, an average density of 9.34 pcf is generally associated with a class 100, which calls for a minimum average density of 9 pcf. CCSB policy provides that commodities or commodity groups exhibiting a wide density range not accurately reflected by a single, overall average density may be assigned densitybased classes. However, in this instance, due to the varying ways that tires are tendered for shipment and the density variances that may result from interlacing or stacking tires from the point of origin to their destination, the use of density-based classes is not practical. Additionally, the record identifies several significant negative stowing and handling characteristics that must be considered. These have been previously detailed in this analysis and include such factors as the lack of a flat load-bearing surface for other freight and handling considerations resulting from the manner in which the tire is tendered for shipment, as well as its size and weight. With respect to commodities that exhibit less-than-favorable handling, stowing or liability characteristics, classification precedent has been to assign a class one or two classes higher than what would generally be called for under the density guidelines. A recent example of such an approach can be found in Docket , Subject 1 (February 2010) involving mail. In that instance, the CCSB approved a class that was one class higher than that called for under CCSB density guidelines to address identified negative handling, stowing and liability characteristics. Based on the information of record, this proposal would establish a class 110 for pneumatic tires, which is one class higher than that called for under CCSB density guidelines, to address the identified negative handling and stowing considerations National Motor Freight Traffic Association, Inc. Subject 1, Page 7 of 8

8 CCSB policy further calls for listing provisions under appropriate generic headings. Accordingly, the provisions for scrap rubber tires are proposed to be cancelled and reestablished under the Waste Materials Group, with no change to the assigned class 60, for clarification and to group these products with other scrap or waste articles 3. Concurrently, Note, item , applicable to item for scrap rubber, is proposed to be amended to reference the new item for scrap rubber tires in lieu of item , which would be cancelled. Based on the information of record, this proposal, as docketed, is in keeping with CCSB policy and precedent. 3 Item (Rule) 110, Section 22 provides a definition for Scrap and stipulates that Unless otherwise provided, the provisions for Scrap will only apply on fragments, scraps or pieces of material that are useless for any purpose other than remelting or the reclamation of raw materials. Such provisions will not apply on articles shipped in their original form, including used articles or defective articles being returned to the manufacturer for credit. Subject 1, Page 8 of National Motor Freight Traffic Association, Inc.