Updated: Major Car Rental Companies Announce Recall Legislation Agreement

- By Joanne Tucker

At 1:45 p.m. Eastern time today, Sens. Charles Schumer and Barbara Boxer held a news conference to announce an agreement reached by all four major car rental companies to stop renting or selling vehicles subject to a manufacturer recall.

On the call were Enterprise Holdings — which owns Enterprise Rent-A-Car, Alamo and National Car Rental — Avis Budget Group, Dollar Thrifty Automotive Group and the Hertz Corp. 

In August, Boxer introduced legislation in the Senate, S. 3502, the Raechel and Jacqueline Houck Safe Rental Act of 2012. The bill aimed at amending title 49 of the U.S. Code to include rental car companies. Title 49 currently only covers vehicle dealers and manufacturers. The bill also outlined company requirements to contact renters when a vehicle is already rented out.

Boxer said that the new proposed legislation agreed to by the companies will include revisions from these earlier bills, such as allowing temporary steps to be taken to remedy safety risks should a temporary step be provided by the manufacturer. Another revision will also allow the sale of a recalled vehicle with a junk title for parts or scrap.

In regard to today's conference call, Enterprise Holdings released the following statement: 

"This proposed bill represents a great deal of thoughtful collaboration by many individuals and organizations. We believe the end result is a solution that will give consumers additional confidence that rental cars are properly maintained and safe to drive. This was a long, complicated and protracted process. However, when all of the parties sat down at the table together, we were able to work out our differences and come up with an effective end-product that works for the long term."

In the statement, Enterprise said it has "voluntarily" committed to not rent or sell recalled vehicles until the recall has been remedied. In addition, Enterprise said that it would not wholesale recalled vehicles either, "except those that are so damaged they are not drivable. In those instances, we disclose the recall to the wholesale buyer."

In terms of why the company decided to announce its formal support, Enterprise said, "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. 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."

Hertz said that the new proposed legislation "is consistent with existing Hertz policy," and also allows the rental car companies to continue managing the recall and repair process. The company added, "We are committed to enacting this legislation and, of course, to continue grounding and repairing recalled cars as quickly as possible, giving our customers total confidence that their safety is our top priority." 

Schumer, Boxer and Cally Houck, who lost her two daughters in 2004 in a recalled Enterprise vehicle, commended the rental car industry and the major companies for supporting the negotiations and proposed legislation.

"These companies have had good standards and practices but now we can make sure everybody does," Schumer said in the call.

The American Car Rental Association (ACRA) also voiced its support for the new bill and today's agreement, stating that the organization and its member companies are in full agreement with the proposed safety requirements. "We have been fully involved in every meeting, teleconference and communication working with all the stakeholders to codify the standards in addressing recalled vehicles in order to have a uniform standard which provides greater confidence to our customers."

ACRA added that the legislation will also apply to car sharing companies.

"This proposed legislation reinforces policies and practices our member companies already use to ensure that their customers rent cars that are safe to drive" ACRA stated. "It’s a responsible approach that reflects a great deal of thoughtful analysis and negotiation and we fully support this recall legislation."

AAA has also announced its support of the bill, among other organizations.

This article was updated at 3:53 p.m. on Sept. 27 to include statements from the American Car Rental Association and follow-up statements from Sen. Barbara Boxer.


See past coverage of recall legislation in the industry here

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