After Accidents, Auto Safety Advocates Push for Federal Regulation of Car Rental Industry

857409_d29620ea_03262012.jpgA tragic 2004 car crash has led to calls for federal legislation and regulation of the rental car industry. Two sisters, Raechel and Jacqueline Houck, 24 and 20 years of age respectively, rented a PT Cruiser from an Enterprise Rent-A-Car in Capitola, California. The car was under recall at the time because of a problem with its power-steering, but the rental company had not performed any repairs. Since the issuance of the recall, it had reportedly rented the car to three other people before the Houcks. The power-steering fluid began to leak while they were driving, and it caught fire. This caused them to lose control of the car. Their car collided with a semi trailer, killing both of them. Enterprise admitted to liability, and a jury awarded $15 million in damages to the Houcks’ mother, Cally Houck, two years ago.

In an effort to prevent accidents like this one, which resulted from a failure to perform necessary repairs on a recalled vehicle, several United States senators introduced the Raechel and Jacqueline Houck Safe Rental Car Act of 2011. This law would have granted regulatory authority to two federal agencies to ensure that rental car companies performed repairs on any vehicles in their fleets under recall before renting them to consumers. The Federal Trade Commission (FTC) would be able to regulate the industry using existing deceptive trade practice laws, and the National Highway Traffic Safety Administration (NHTSA) would be able to track and monitor safety features in vehicles rented to the public.

Under current law, the NHTSA can require auto manufacturers to repair vehicles under recall before distributing them to dealers. Dealers that sell new vehicles must also perform recall repairs before selling to consumers. None of these laws currently cover rental car companies, although they are reportedly the continent’s largest purchaser of new cars and supplier of used cars.

Out of the 1.6 million vehicles owned by American rental car companies, almost 184,000 were subject to a recall in 2011, according to USA TODAY. Toyota issued a recall in 2010 that affected around twenty-two percent of the total number of rental cars in the country. The main trade group representing rental companies told USA TODAY that the industry has a better track record for recall repairs than most vehicle owners. Still, the industry operates with almost no oversight, which concerns some safety advocates, and even some in the industry itself.

The second-largest auto rental company in the country, Hertz, recently reached an agreement with the NHTSA to provide the agency with oversight over recalled cars in its fleet. The company will join with safety advocates to ask Congress to pass a law providing for oversight. Several senators who sponsored the bill named for the Houcks have said they will introduce legislation again soon. Other rental car companies disagree with Hertz’s view, stating that the industry can regulate itself and that the proposed new laws leave other industries untouched, including taxis and limousines.

The Maryland accident injury lawyers at Lebowitz & Mzhen are skilled at pursuing justice for people injured in automobile accidents on Maryland roads. Contact us today online or at (800) 654-1949 for a free and confidential consultation.

More Blog Posts:

Four Die in Car Crash in Anne Arundel County, Maryland, Maryland Accident Law Blog, February 20, 2012
Maryland Traffic Cameras Seek to Deter Speeding, Promote Safe Driving, Maryland Accident Law Blog, January 23, 2012
Two Senior Citizens Killed in Benedict, Maryland, Car Accident, Maryland Accident Law Blog, September 20, 2011
Photo credit: ‘Car rental car park, Stansted,’ copyright Jonathan Billinger and licensed for reuse under this Creative Commons Licence.

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