Senate Bill Would Make It Illegal to Rent Recalled Cars

Car rental companies would be prohibited from renting cars that have been recalled for safety-related issues under legislation being proposed by Sen. Charles Schumer (D-NY). Earlier this week, a study by federal safety regulators found that since 2006, major car rental companies have let tens of thousands of drivers go on the road without repairing defects.

Under current law, any car under a recall notice cannot be sold by an auto dealer until the safety issue has been resolved, but that same restriction does not apply to rental car companies, which are currently allowed to rent cars under recall before the safety issue has been addressed.

Schumer's bill, the Safe Rental Car Act, would make that illegal.

The issue was brought to public attention when two sisters from California died when their rented PT Cruiser caught fire and crashed into a tractor-trailer truck as a result of a safety defect subject to a recall.

Schumer’s bill will address serious concerns brought to light by a recent study conducted by the National Highway Traffic Safety Administration (NHTSA) that shows that major rental car companies are failing to address safety recall issues for a significant percentage of cars in their rental car fleets before renting their vehicles.

“Rental car companies should be immediately barred from renting cars that would be pulled from showrooms and car dealer lots because of safety recall concerns,” said Schumer. “This is a serious public safety issue and, tragically, we have already seen the grave and devastating consequences of inaction.”

NHTSA examined the percentage of dozens of GM and Chrysler vehicles in rental car fleets that had been fixed within 90 days of 10 different recall notices from 2006 to 2010. (Ford failed to respond to the survey).

Automakers have previously told the federal government that rental car companies typically fix less than a third of recalled vehicles within a month of the recall and, over the course of a year, that number climbs to just 50%.

According to the audit only 34% of Hertz’s rental cars under recall had been fixed within 90 days. Avis/Budget had only fixed 53% of the cars under recall during the same time period, and Enterprise, the top performing member of the group, had only addressed recall notices in 65% of their cars after 90 days. The study suggests that tens of thousands of rental car drivers have unknowingly rented vehicles under recall, posing a serious threat to safety on roadways.

Raechel and Jacquie Houck, sisters from California, rented a Chrysler PT Cruiser from Enterprise. One month before it was rented to the Houcks, the car had been recalled because a possible leakage of power steering fluid could result in a fire under the hood of the car.

Enterprise failed to address the safety recall, and the Houck sisters were killed when their rental car caught fire and slammed into an oncoming truck. The victim’s mother, Cally Houck, sued Enterprise and was eventually awarded $15 million.

"I welcome a bill that would prevent the sort of tragedy that took my daughters' lives,” said Cally Houck. “No other family should have to endure the heartbreaking loss of loved ones because of an unsafe rental car."