Recall Repairs Now Required on All Rental Cars Under New Law

New legislation that went into effect this week now requires that all car rental companies repair any outstanding recalls impacting vehicles in their fleet before renting the cars to customers, extending the National Highway Traffic Safety Administrations (NHTSA) authority to investigate and punish violators.

The new rental car recall repair law was announced by the NHTSA on June 1, indicating that all rental car agencies carrying fleets of 35 vehicles or more must repair any and all open safety defects before renting the vehicles to customers, or be subject to punishment and fines. The new law gives the NHTSA full powers for the first time to monitor, investigate and enforce penalties or repair actions on qualifying rental car companies.

The new requirements comes as part of the Fixing America’s Surface Transportation (FAST) Act of 2015.

Prior to the new law’s passing, only new vehicles sold through dealerships were required to be repaired of any safety defects, whereas rental car companies were not mandated to repair any open safety recalls announced by the NHTSA, placing consumers at risk of injuries or auto accidents caused by known and avoidable safety defects.

The push for rental car companies to require repairs of safety defects has been urged for several years by U.S. Secretary of Transportation Anthony Foxx and NHTSA Administrator Dr. Mark Rosekind. Foxx stated in the press release that families picking up rental cars on vacations should be able to expect the vehicle is free from any known safety defects. Foxx also thanked Congress and the safety advocates for helping “turn this common-sense idea into law.”

The NHTSA credited efforts from the family of Raechel and Jacqueline Houck, two sisters that died in a fiery crash in 2004 on a California highway. The sisters rented a PT Cruiser from an Enterprise Rental car facility, which had an outstanding recall on a power steering leak that was never repaired.

Experts hired by the family to reconstruct the accident and the cause determined the driver lost power steering ability, causing the vehicle to cross a grass median and hit a tractor trailer, bursting into flames instantly and killing both sisters. Although Enterprise challenged the case, arguing that the driver’s actions caused the crash, a jury awarded $15 million in damages to the parents who filed the wrongful death lawsuit.

Used Car Dealers Unaffected

Although the new law resolves unrepaired recalls in rental vehicles, used car dealerships are still not required by law to repair safety defects before the sale of the vehicle. Consumer interest groups have made efforts to change the current laws requiring used car dealerships repair recalls before the sale, citing CarMax as one of the top responsible for the resale of unrepaired vehicles.

The California Public Interest Research Group and the Consumers for Auto Reliability and Safety Foundation released a study in June 2015 that more than 10% of the nearly 500 cars on the a Sacramento, California CarMax sale lot had unrepaired recalls and seven vehicles were subject to two or more unrepaired safety recalls.

One incident report the groups refers to in their petition occurred in Irvine, California, where a couple with children purchased a “CarMax Quality Certified” Dodge Ram 1500 from CarMax on May 19, 2015 because they wanted a safer vehicle to transport their children. After they purchased the truck they were informed by Chrysler that a safety recall had been in effect for over a year on that vehicle due to the drive shaft reportedly separating from the rear axle.

When the couple tried to return the vehicle to CarMax, the dealer denied their claims and told them it was their problem now. Just 11 days after purchasing the vehicle, without warning, the drive shaft separated from the axle and the truck fell apart on the freeway and caught on fire. The couple and their 12 year old daughter barely escaped the vehicle before it burst into flames, which closed down the freeway for nearly four hours while first responders fought to put out the fire.