(a) An establishment engaged in the selling of tires, tubes,
accessories and of repair services on tires may qualify as an exempt
retail or service establishment under section 13(a)(2) of the Act if it
meets all the requirements of that exemption. Similarly, an
establishment engaged in retreading or recapping tires may qualify as an
exempt establishment under section 13(a)(4) of the Act if it meets all
the requirements of that exemption.
(b)(1) In determining whether, under the 13(a)(2) exemption, 75
percent of the establishment's sales are not made for resale and are
recognized as retail sales in the industry, sales other than those
described hereinafter in the subparagraphs of this paragraph may be so
counted if they meet all the requirements for such classification as
previously explained in this subpart. Not eligible for inclusion in the
requisite 75 percent are sales of goods that cannot be the subject of a
retail sale because the goods are not of a ``retailable'' type or the
sales of such goods lack the ``retail concept'' (see Sec. 779.321). Nor
can sales for resale be counted toward the 75 percent. For example,
sales of tires, tubes, accessories or services to garages, service
stations, repair shops, tire dealers and automobile dealers, to be sold
or to be used in reconditioning vehicles for sale are sales for resale.
Further, the sales of tires, tubes, accessories and tire repair
services, including retreading and recapping, which are described in the
following paragraphs (b) (2) through (7), are not recognized as retail
in the industry.
(2) Sales made pursuant to a formal invitation to bid: Such sales
are made under a procedure involving the issuance by the buyer of a
formal invitation to bid on certain merchandise for delivery in
accordance with prescribed terms and specifications. Sales to the
Federal, State and local governments are typically made in this manner.
(3) Sales to ``national accounts'' as known in the trades; that is,
sales where delivery is made by the local tire dealer under a
centralized pricing arrangement between the customer's national office
and the tire manufacturer; payment may be made either to the local
dealer or direct to the tire manufacturer under a centralized billing
arrangement with the customer's national office.
(4) Sales to fleet accounts at wholesale prices: As used in this
section, a ``fleet account'' is a customer operating five or more
automobiles or trucks for business purposes. Wholesale prices for tires,
tubes, and accessories are prices equivalent to, or less than, those
typically charged on sales for resale. If the establishment makes no
sales of passenger car tires for resale, the wholesale price of such
tires will be taken to be the price typically charged in the area on
sales of passenger car tires for resale. If the establishment makes no
sales of truck tires for resale, the wholesale price of such tires will
be
taken to be the price charged by the establishment on sales of truck
tires to fleet accounts operating 10 or more commercial vehicles, or if
the establishment makes no such sales, the wholesale price will be taken
to be the price typically charged in the area on sales of truck tires to
fleet accounts operating 10 or more commercial vehicles. (See Wirtz v.
Steepleton General Tire, 383 U.S. 190, 202, rehearing denied 383 U.S.
963.)
(5) Sales of a tire rental service on a mileage basis known in the
trade as ``mileage contracts'': This is a leasing arrangement under
which a tire dealer agrees to provide and maintain tires or tubes for
motor vehicles of a fleet account.
(6) Sales of servicing and repair work performed under a fleet
maintenance arrangement on tires for trucks and other automotive
vehicles whereby the establishment undertakes to maintain the tires or
tubes for a fleet account at a price below the prevailing retail price.
(7) Sales, repair, recapping, or rental of truck or machinery tires
suitable for use only on trucks or equipment of a specialized kind that
cannot themselves be the subject of a retail sale because their lack of
a concept of ``retailability'' as previously explained precludes the
recognition of their sale as ``retail;'' to any industry.
