Groundbreaking Legislation Would Close Dangerous Loophole for Recalled Rental Cars

rental car recall law

A bipartisan coalition of U.S. senators has introduced landmark legislation that would prohibit rental car companies from renting or selling vehicles with open manufacturer recalls, closing a dangerous gap in consumer protection laws that has persisted for decades.

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            Key Points:
            Bill named for two sisters killed in a crash caused by a recalled rental vehicle
Would establish same recall standards for rentals as currently exist for dealership sales
Major rental companies already support the legislation
NHTSA would gain new enforcement authority over rental fleets

        

The Houck Tragedy: Catalyst for Change

The proposed legislation, officially titled the Raechel and Jacqueline Houck Safe Rental Car Act of 2013, is named for two California sisters who died in 2004 when their recalled rental car caught fire due to a known defect and collided head-on with a tractor-trailer. The vehicle, a PT Cruiser, had been rented despite an unrepaired power steering hose recall that could (and did) cause engine fires.

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"Rental car companies are rolling the dice with passengers' lives each day and every time they rent a car that's under a recall. This practice has already proved tragic. We need a law to ensure that recalled cars are never again driven off rental lots."

- Senator Charles Schumer (D-N.Y.)

Current Law vs. Proposed Changes

Under existing regulations, car dealerships are prohibited from selling recalled vehicles to consumers until repairs are made. However, no federal law prevents rental companies from renting unrepaired recalled vehicles - a loophole this legislation aims to close.

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Key Provisions of the Safe Rental Car Act

Prohibits rental or sale of recalled vehicles until repairs are completed

Requires grounding recalled vehicles within 24 hours of notice (48 hours for large-scale recalls affecting 5,000+ fleet vehicles)

Allows temporary safety measures if identified by manufacturer, but requires permanent fix when parts available

Grants NHTSA authority to investigate and enforce rental company recall compliance

Industry Support and Implementation

Notably, the bill has garnered support from all major rental car companies - including Hertz, Enterprise, Avis Budget, Dollar Thrifty, and National - as well as the American Car Rental Association (ACRA).

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"It is critically important that Congress codify what most of the car rental industry voluntarily enacted last year. By formally creating a uniform standard, both car-rental and car-sharing customers will have even greater confidence going forward no matter where they rent their vehicles."

- American Car Rental Association Statement

Most major rental companies implemented voluntary policies against renting recalled vehicles following a 2012 Senate hearing on the issue. However, the legislation would create consistent legal requirements across the entire industry.

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For Consumers

Increased confidence that rented vehicles meet all safety standards. According to NHTSA data, rental companies currently operate about 1.7 million vehicles in the U.S., with an estimated 150,000 under recall at any given time.

For Rental Companies

Clear federal standards replace a patchwork of state regulations. The bill provides specific timelines for compliance and addresses logistical challenges with large fleets.

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For Safety Advocates

Closes what many call a "dangerous double standard" in vehicle safety law. The legislation represents the culmination of a decade-long campaign by the Houck family and consumer protection groups.

Legislative Path Forward

The bill, first introduced in September 2012, is co-sponsored by Sens. Charles Schumer (D-N.Y.), Lisa Murkowski (R-Alaska), Barbara Boxer (D-Calif.) and Claire McCaskill (D-Mo.). McCaskill, as chair of the Senate Commerce Committee's Consumer Protection subcommittee, has announced plans to hold hearings on the legislation later this month.

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With bipartisan support and industry backing, the Safe Rental Car Act stands a strong chance of passage, potentially taking effect as early as 2014. The legislation represents one of the most significant updates to rental car industry regulations in decades.

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Groundbreaking Legislation Would Ban Rental of Recalled Vehicles