New Bill Introduced to Prohibit Rental of Recalled Vehicles

By Kirsti Correa

The Raechel and Jacqueline Houck Safe Rental Car Act, S. 3706, was introduced by Sen. Charles Schumer (D-N.Y.) on Dec. 21 to prohibit both the rental and sale of vehicles under recall until the vehicles have been fixed.

Manufacturers must recall vehicles that do not meet federal safety standards or that have safety-related defects. Auto dealers are prohibited from selling such recalled vehicles under current law.

S. 3706 is aimed at holding car rental companies to the same standards as auto dealers. Efforts to push this legislation have been ongoing as U.S. Sens. Barbara Boxer and Dianne Feinstein (both D-Calif.) introduced S. 3502 in August to include car rental companies under title 49 of the U.S. Code that applies to manufacturers and dealers only.

This newest bill also includes a Republican co-sponsor, Sen. Lisa Murkowski from Alaska, as well as co-sponsors Sens. Claire McCaskill (D-Mo.), Richard Blumenthal (D-Conn.), Robert Casey (D-Penn.) and Kirsten Gillbrand (D-N.Y.), as well as Boxer and Feinstein.

According to S. 3706, car rental companies will be allowed to sell a damaged vehicle with a junk title for parts or scrap only.

The bill also requires companies to ground recalled vehicles no later than 24 hours after they receive notice or up to 48 hours for fleets that include more than 5,000 recalled vehicles. 

In some instances, rental companies can continue to rent recalled vehicles if steps — outlined by the manufacturer to eliminate the safety risk — are taken while the company waits for parts to fix the defect.

Under the bill, the National Highway Traffic Safety Administration (NHTSA) will oversee rental companies' recall safety practices.

The American Car Rental Association (ACRA) and all major car rental companies, including Avis Budget, Dollar Thrifty, Enterprise, Hertz and National, support the bill.

The bill will likely have to be re-introduced, however, since the close of the 112th session of Congress is Jan. 3.

Click here to see all our past coverage on this topic of recalls in the industry.