Hoping for a reversal of the lead ban that shelved youth, off-highway vehicles, manufacturers and dealers are preparing for life without what industry officials estimate is a $14.5 billion a year category.

The industry scored its first victory on May 4 when the Consumer Product Safety Commission granted a two-year enforcement delay on 12-and-under powersports vehicles. The stay ends on May 1, 2011. However, as the commission warned previously, the enforcement delay does not protect dealers and powersports makers from consumer lawsuits or enforcement by other state and federal agencies. That’s why the industry is pinning its hopes on two bills making their way through Congress that could permanently remove youth vehicles from the Consumer Protection Safety Improvement Act of 2008 (CPSC).

“The MIC (Motorcycle Industry Council) and the SVIA (Specialty Vehicle Institute of America) thank CPSC acting Chairman Nancy Nord and Commissioner Thomas Moore for attempting to get youth model ATVs and motorcycles back on showroom floors,” read a statement from the MIC. “However … due to the highly restricted language of the CPSIA and the fact that the CPSC is not the only agency responsible for enforcing the law, this stay of enforcement is simply inadequate in legal terms and leaves the industry vulnerable to lawsuits and actions by federal and state agencies.”

It’s one of the reasons why manufacturers such as American Honda Motor Co. are continuing with plans to distribute new labels to dealers that restrict the sale of the banned vehicles to riders 12 years and older. The strategy, however, would not impact all youth vehicles, said Bill Savino, a spokesperson for Honda.

“The products got caught up in a law that was passed for the right reason, but unfortunately it didn’t get worded properly,” noted Savino, who said the company was expected to distribute new labels for its CRF50F/70F/80F and XR50/70/80 youth vehicles, as well as the TRX90X all-terrain vehicle at the beginning of May. “We’re just hoping to get a stay by the end of April, beginning of May. They really need to look at the wording because the small off-road vehicles are a big part of our business.”

Passed last August, the CPSIA was prompted by numerous high-profile recalls of children’s toys and other items. In late December, however, a new component of the law was added that banned youth products with lead in excess of 600 parts per million, a measurement that forced dealers to pull all 85cc, 70cc, 65cc, and 50cc displacement mini bikes by the ban’s Feb. 10 effective date.

The law’s wide-ranging authority impacted not only manufacturers and dealers, but trade-ins and resales involving vehicles, parts or apparel for children ages 12 and under. Violators of the ban faced a $100,000 penalty per violation, and a maximum of $15 million in fines.

The MIC and the SVIA lobbied the CPSC to exclude youth off-highway vehicles weeks before the law’s effective date, but were denied. The commission also denied a Feb. 5 request for an emergency stay by the two associations and the National Association of Manufacturers CPSC Coalition.

The CPSC rejected another attempt in April by the MIC, the SVIA and the Coalition for Safe and Responsible ATV Use. The hope now is for the passage of H.R. 1587 and S. 608. Introduced in the House by Rep. Danny Rehberg (R-Mont.) and in the Senate by Sen. John Tester (D-Mont.), the bills would amend the CPSIA to provide a permanent exemption for all-terrain vehicles, motorcycles, snowmobiles and side-by-sides.

“The approach is different, the language is different, but the result is the same,” said Paul Vitrano, general counsel for the MIC, in April. “We’ve been working aggressively for the last few weeks to help folks in the industry contact their legislators to gain support for the bills.”

Dealers have also made their displeasure with the ban known. On March 19, legendary racer Malcolm Smith staged a sales event in protest of the ban at his Riverside, Calif., dealership. It drew nearly 400 supporters, including racer Jeff Ward, motorsports design guru Troy Lee, and Glen Helen Raceway Owner Bud Feldkamp. Each purchased youth-size powersports vehicles to show their support.

Smith also took deposits for “post-CPSIA” sales, which he said he would hold on to until the Federal ban was lifted.

“We [motorcycle riders] used to be tough guys and fought for what we believed in. Unfortunately, we’ve become soft and allowed things like the CPSIA as a result,” Smith said days after the event, which also drew the attention of mainstream media outlets such as USA Today and CNN. “If we don’t stand up to them now, what kind of future are we going to have? What kind of future will these kids have?”

While the ban has caused an industrywide drop in sales of youth bikes, Honda’s Savino believes non-metropolitan dealerships were hit the hardest. “You get out in the outskirts and desert areas, the small dirt bikes are a big part of business,” he said. “And again, it didn’t just affect this industry, bicycle and many other manufacturers were impacted as well.”

The support of the manufacturer helped to lessen the blow for DFW Honda in Grapevine, Texas. Not only did Honda inform the dealership about the ban two weeks before it went into effect, it also provided flooring support to cover the banned vehicles. Still, Matt Milliken, the dealership’s business director, couldn’t put an estimate on lost revenues.

“Because of the floor support we received, the vehicles got to sit here for free,” he said. “As for lost revenue, we just let [customers] know that hopefully there’s a future opportunity to purchase something.”

Milliken was waiting for that opportunity in late April, when Honda was expected to begin distributing its new labels. He was informed of Honda’s plans on April 22, as the powersports vehicle maker said in a letter that dealers could resume selling five of its models if the units carried labels stating the new age restrictions. Honda Financial also told Milliken’s dealership it would resume financing on new units outfitted with the new labels.

“We get constant updates on the new strategy Honda is employing,” Milliken said. “It’s had conversations with the CPSC about policing sales. They haven’t set a date on remarketing, but they have sent out pictures of the labeling. I imagine if they resume sales, the parts would go into effect as well.”