Report: Car rental industry advocates for two-tier recall system

Maybe rental organizations should negotiate deals with mechanics from manufacturers or dealers to fix cars on the lot. Most recalls are simple and easy to fix, and it might cost them a little more, but it would be by far the most efficient way of doing it.

via Autoblog by Chris Shunk on 4/6/11

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Rental car agency

Recalls can be a big problem for car rental companies. The companies make money by renting as many vehicles in advance as possible, and an entirely booked fleet can be a recipe for profits. But what happens when there is a recall on a car or truck that is already scheduled for rental? Does the rental company call the customer and tell them that their order can no longer be fulfilled? In some cases, the rental company may want to wait until the vehicle isn’t needed to get the problem looked at, which could potentially put the customer at risk.

How do you fix the problem of rental car companies failing to execute their recalls in a timely manner? The New York Times reports that the American Car Rental Association, which consists of 95 companies and all major renters with the exception of Hertz, feels a two-tier recall system would work best. Under the two-tier system, the National Highway Traffic Safety Administration and automakers would determine which recalls were serious enough that they needed to be done immediately, and which ones could wait a bit. The multi-tier approach would, in theory, force rental car companies to act quickly for serious recalls, while still maintaining the luxury of waiting for the right time to repair others. Rental companies would no doubt love such an arrangement, but safety advocates aren’t so sure.

NHTSA’s response is that the agency takes all recalls seriously, while other advocates like Rosemary Shahan, the president of Consumers for Auto Reliability and Safety calls the proposal “rental car roulette” and says that it will “allow rental car companies to get away with renting out vehicles that are so unsafe they are being recalled.” Senator Charles Schumer (D, NY) has asked the Federal Trade Commission to look into the fact that dealers are legally forbidden to sell vehicles with open recalls while rental companies can rent cars to customers with open recalls.

[Source: The New York Times]

Report: Car rental industry advocates for two-tier recall system originally appeared on Autoblog on Wed, 06 Apr 2011 09:32:00 EST. Please see our terms for use of feeds.

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