Advocacy Groups Petition FTC to Stop Enterprise From Renting Recalled Vehicles

Two automotive safety advocacy groups and the mother of two women killed in a traffic accident involving a recalled vehicle rented by Enterprise Rent-A-Car, petitioned the Federal Trade Commission Monday to stop Enterprise and its parent company from renting out unrepaired recalled vehicles to customers.

The petition was filed by the Center for Auto Safety (CAS), Consumers for Auto Reliability and Safety (CARS), and Carol S. Houck. Among other suggestions, the petition says Enterprise Rent-A-Car and Enterprise Holdings should adopt the following procedure on how to handle vehicle recalls: "...once Enterprise receives the official notice of the recall, the affected vehicles should be immediately parked until fixed. This is the same duty that new car dealers have been assigned by the federal Motor Vehicle Safety Act...and is appropriate for Enterprise under the circumstances." 

In 2004, Houck's daughters, Raechel and Jacqueline, rented a Chrysler PT Cruiser from Enterprise in California. The vehicle was recalled by the manufacturer for a power steering hose defect that was known to cause an underhood fire, but was never repaired.

The two women rented the vehicle and were unaware of the safety recall. They died in a head-on traffic collision with an 18-wheeler on the 101 north highway near King City, Calif., on Oct. 2, 2004.

A jury awarded their parents $15 million on June 9, 2010 in a lawsuit against Enterprise Rent A Car.

"Justice has not been served," Houck said of the verdict. "Justice is making sure this never happens to another family. That's why the FTC must grant this petition."

"Our petition asks ... the FTC to stop Enterprise from making claims suggesting that its rental vehicles are safe, such as in ads that use misleading words like 'well-maintained' and 'security and reliability' to describe their vehicles," said Clarence Ditlow, executive director of CAS.

"Not only is it deceptive for Enterprise to fail to disclose its practice of renting out recalled but unrepaired vehicles, it is deceptive of Enterprise to have such a practice in the first place. Only strong FTC enforcement action will stop Enterprise from renting unsafe vehicles to consumers and send a message to all rental car companies to park recalled cars until fixed," Ditlow said.

Enterprise Rent A Car reiterated on June 22, 2010, its procedures for handling manufacturers' vehicle recalls after the verdict in the Houck lawsuit was handed down.

"If and when manufacturers recommend that vehicle owners park or ground their vehicles, we promptly do so," said Greg Stubblefield, executive vice president and chief strategy officer for Enterprise. "However, we also believe there are times when recalled vehicles need to be grounded regardless."

"Given all we have learned, today we would ground the recalled PT Cruiser until repaired," Stubblefield said. "That is why we continue to work with our employees and automobile manufacturers on ways to improve our policies and procedures for handling recalls. 

"We share the Houcks' goal of preventing anything like this happening again," Stubblefield said. "Of course, nothing can change this heartbreaking situation for the Houck family and, again, we are truly sorry for their terrible loss."

To view the full petition, visit www.autosafety.org.

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