Major Rental Car Companies Back Legislation on Recalled Models
By Mimi Kmet
September 28, 2012 2:24 PM
The four largest rental car companies, which account for more than 90 percent of the rental car market, have agreed to support federal legislation that calls for them to stop leasing any model that is under a safety recall until the defect has been corrected. Avis Budget Group Inc., Dollar Thrifty Automotive Group, Enterprise Holdings Inc. (parent company of Alamo Rent A Car, Enterprise Rent-A-Car and National Car Rental), and The Hertz Corporation will back a bill by three U.S. senators that that will require the companies to pull recalled vehicles out of their rental fleets within 24 hours after they receive a recall notice. If the recall involves more than 5,000 vehicles in a fleet, they have 48 hours to stop renting them. The American Car Rental Association (ACRA) also agreed to support the bill.
The lawmakers — Charles Schumer of New York, Barbara Boxer of California and Claire McCaskill of Missouri — plan to push the bill into becoming law after the presidential election. Currently, federal law requires that automobile dealers not sell recalled cars, but that law does not address rental car companies.
Another piece of legislation, which the rental car companies and ACRA also are backing, calls for oversight of compliance to the recall law by the National Highway Traffic Safety Administration.
The legislation is called the Raechel and Jacqueline Houck Safe Rental Car Act of 2012, named after two sisters in their early 20s who died in a 2004 crash when their rented Chrysler PT Cruiser lost control due to a power steering leak. The model was under recall at the time.
An Avis Budget Group Inc. spokesperson emailed this comment to TravelPulse.com: “At Avis Budget Group our practice is and has been to not rent vehicles that are under a safety recall. On that basis we have always supported federal legislation that would apply this same standard fairly and equally to all industry participants. We are pleased that this compromise bill accomplishes this objective and therefore we support its passage.”
An Enterprise Holdings Inc. spokesperson emailed a statement saying, during the legislative process for the bill, the our company voluntarily made commitments to not rent recalled vehicles until the recall has been remedied, sell recalled vehicles to consumers or wholesale recalled vehicles unless they are so damaged that they are not drivable. (In those cases, the company will disclose the recall to the wholesale buyer.)
“Because the major car rental companies had revised their recall policies years ago, we initially did not believe that federal oversight of our industry was necessary,” the statement said. “But when car rental customers let us know that they would be more comfortable with legislation in place, we quickly changed direction and began working closely with all involved stakeholders. We now believe federal oversight — which will codify current practices and operational policies — will help to strengthen our industry’s safety efforts.”
A Hertz spokeswoman said via email that the company has been involved in an agreement since January that “is almost identical to the federal legislation being announced today. It’s clear that Senators Schumer, Boxer, and McCaskill’s leadership generated the momentum to achieve a broad-based agreement.” She also hailed the legislation for allowing rental car companies “to continue managing the recall and repair process.”