Raising the threat of criminal prosecution, the Reagan administration has told a consumer group to return an internal government memo that cites "confidential" industry information and accuses auto companies of exaggerating the costs of air-bag safety devices.
The confidential cost estimates by General Motors Corp. and Ford Motor Co. are trade secrets protected by federal law, said Raymond Peck, administrator of the National Highway Traffic Safety Administration.
Clarence Ditlow III, executive director of the Center for Auto Safety obtained the internal NHTSA memo, dated July 11, 1979, and has quoted it to support his charge that auto manufacturers have misled the public about the cost of air bags. With the Reagan administration's approval, GM and Ford have abandoned plans to offer air-bag systems as optional equipment, saying the costs to consumers would be prohibitive at more than $1,000 a unit.
According to the memo, GM's public estimate on March 1979 was that an air-bag system would cost customers $509, based on a production volume of 750,000. Four months earlier, it had given the NHTSA a confidential estimated cost of $206, based on a much larger production volume of 31/2 million units.
That difference in production volume would not account for that great a price variation, according to information from the manufacturers of air-bag components. But GM said Ditlow's conclusions were off-base and misinformed.
"We do not understand the cost figures the Center for Auto Safety is citing," GM said in a statement yesterday. "They appear to be based on maximum volumes and do not appear to include the impact of inflation over the last several years. It is regrettable that uninformed persons feel compelled to use information they apparently don't understand."
The author of the memo, A.C. Malliaris, an associate administrator of the NHTSA, said the agency is hurt by "the selective release of the highest figures by the manufacturers without mention of any other conditions under which the costs could be three to four times lower," and proposed that the confidential cost estimates be declassified and made public and the auto companies asked to document the various figures.
Ditlow had tried to have the memo and cost estimates included in the official record of the NHTSA's current review of passive-restraint regulations -- the air-bag and automatic-seat-belt rule.
The NHTSA refused, and this week it issued a blunt warning to Ditlow to hand over the memo and the confidential data.
Frank Berndt, NHTSA general counsel, wrote to Ditlow on Monday: "I hereby request that you immediately cease any further publication of this information and that you return the original copy of these documents and all copies in your possession . . ."
Ditlow said yesterday he won't comply with Berndt's letter. "They'll have to get a court order if they want that memo back," said Ditlow, head of the consumer group that was founded by Consumers Union and by Ralph Nader in 1970 but has been independent from both for the past nine years.
In an interview yesterday, Peck said his agency would consider criminal action against Ditlow for allegedly receiving stolen property. "We haven't ruled it out. I don't want to create an image of a witch hunt and masked riders with torches . . . but this kind of information is protected under law for a reason." Unless confidentiality is assured, companies won't provide such information voluntarily, he said. "We're better off having it than not," Peck added.
Ironically, the confidential data that the NHTSA is determined to recover was introduced by Ditlow into the record of an April 30 Congressional hearing conducted by Rep. Timothy E. Wirth (D-Colo.) The hearing record has not yet been published, however.
Ditlow said he obtained the memo "some time ago" but did nothing with it during the Carter administration because the NHTSA estimates of the cost of air bags were close to those in the memo, about $200 a unit.
When the industry abandoned air-bag development this year and the NHTSA adopted the industry's new cost estimates of $1,000-plus, he decided to make the memo public, Ditlow said.
It includes a number of confidential estimates, both for complete air-bag systems and for "modules" consisting of the bag and the inflation device, but not the electronic sensors and controls and the modification required on automobiles that come with air bags, according to government sources.
GM's confidential estimate in 1979 was that its unit cost of producing 400,000 air-bag modules on 1982-model cars would be $221. For 750,000 modules, the cost would be $195. If 31/2 million modules were made, the cost would be only $96, according to a November 1978 confidential estimate.
Ford's estimates ranged from $101 a unit if 885,000 modules were manufacturered to $300 if 200,000 were produced.