Consumers for
Auto
Reliability and
Safety
 
 
 
 
Virginia Car Dealers to Used Car Buyers: DROP DEAD!!
Brazen Attempt to Legalize Sales of Unrepaired, Unsafe Recalled Cars with Lethal Safety Defects
 
Virginia auto dealers are mounting a sneak attack aimed at making it legal, for the first time, for car dealers in VA to get away with selling unsafe recalled used cars without fixing the potentially lethal safety defects first. The car dealers are backing two bills, SB 709 (authored by Republican Senator Ryan McDougle) and HB 1232 (carried by Republican Delegate Greg Habeeb).

The bills were introduced without fanfare, at a time when car dealers nationwide are facing increased scrutiny by federal regulators over their deceptive sales of unsafe recalled used cars and mounting pressure by the U.S. National Highway Safety Administration. In addition, CarMax, the nation's largest used car dealership chain, with headquarters in Richmond, VA, is also under fire over its deceptive and misleading sales practices, which have been the target of numerous media investigations and reports issued by the CARS Foundation and PIRG Education Funds in California, Massachusetts and Connecticut. Over 97,000 people have signed a petition calling on CarMax to stop selling unsafe recalled cars. https://www.change.org/p/carmax-stop-selling-unsafe-recalled-cars-to-consumers-2

It is already illegal, in all 50 states, for dealers to sell unsafe new or used vehicles to consumers. Dealers who sell unsafe recalled used cars face severe penalties and sanctions, including loss of their license to conduct business, punitive damages that may cost them millions of dollars, major fines, and other penalties for violations of state laws. For example, a jury unanimously awarded the Houck family $15 million after Raechel and Jacqueline Houck were killed by an unrepaired recalled car. Their parents sued under state laws that prohibit negligence or wrongful death. Dealers also face legal sanctions for violating laws against engaging in unfair or deceptive acts and practices, violating express or implied warranties, or engaging in fraud. Any dealer who fails to disclose a "material" fact -- concealing information that is important -- may be guilty of criminal fraud. Findings of fraud have sometimes led to hefty jury verdicts against dealers, helping deter other dealers from engaging in such practices.

Depending on how dealers advertise their cars, their sales of unrepaired recalled used cars may also be a violation of federal law. Recently, the Federal Trade Commission announced a crackdown against GM and its dealers, Lithia Motors, and Jim Koons Management Company, which is based in Virginia, over their advertising and sales of unrepaired recalled used vehicles as so-called "certified" cars. Typically, manufacturers and dealers advertise "certified" vehicles as being superior to other vehicles, using terms like "nearly new" and telling consumers to "expect perfection." They also charge extra for "certified" cars and claim they must pass a "rigorous" inspection of many specific components, claiming they inspect 125+ or 170 or more different points / components.

Recently, the Federal Trade Commission issued this press release, announcing the proposed legal settlements. Note: the FTC is also seeking public comments regarding the proposed settlements, and consumer / safety non-profits will push hard for the FTC to outlaw these dangerous, inherently deceptive practices. FTC News Release: https://www.ftc.gov/news-events/press-releases/2016/01/gm-jim-koons-management-lithia-motors-inc-settle-ftc-actions

According to the Daily Press in Richmond, the car dealers deny that their bills are anti-consumer. Don Hall, president and CEO of the Virginia Automobile Dealers Association, downplayed alarms raised about the bills, and even claimed that "the vast majority of recalls are for minor things."

However, that is false. In fact, that is exactly the type of misleading, irresponsible statement that could trick car buyers into the mistaken notion that a recall may not be serious, when it may actually pose a serious risk of death or devastating injuries. It may also lead car buyers into believing there is no urgency need to getting their car's safety recall repaired.

GM similarly downplayed the threat posed by faulty ignition switch defects for over a decade, while hundreds of its customers were injured or killed. One of GM's victims was Lara Gass, a beautiful, talented, young woman and beloved daughter. Ms. Gass, an honors student and law review editor at the Washington and Lee University School of Law in Lexington, Va., was driving on Interstate 81 in Virginia one Tuesday morning. According to a report in the New York Times, "On March 15, three days before the accident, Ms. Gass’s parents received the recall notice from G.M. with its warning not to drive with any objects on the key chain. Mr. Gass scanned it into his computer and forwarded it in an email to Lara, who was in Washington with friends running a half-marathon...Ms. Gass, 27, was killed after crashing into a tractor-trailer on her way to work as an intern for a federal judge."

NY Times report: After a G.M. recall, a fiery crash and a payout.

Typical types of safety defects that lead to safety recalls:
  • Seat belts that fail in a crash
  • Air bags that explode with excessive force and spew shrapnel into faces and necks, causing blindness and bleeding to death
  • Axles that break
  • Wheels that fall off
  • Child safety seat anchors that fail to latch
  • Components that burst into flames
  • Fuel leaks that cause carbon monoxide poisoning
  • Ignition switches that cause a loss of steering and braking, and also disengage the air bags
  • Sticking accelerator pedals
  • Brake failure
  • Stalling in traffic
Richmond, VA. CARS President Rosemary Shahan participates in news conference with US Secretary of Transportation Anthony Foxx, National Highway Traffic Safety Administration Administrator Dr. Mark Rosekind, Richmond, VA Mayor Dwight Jones, and allies from the rental car industry.
Secretary Foxx and Administrator Rosekind called upon auto dealers to stop foisting unsafe recalled rental, loaner, or used cars onto the public.
 
Daily News Report: Sudden Disagreement: Is car bill good for consumers, or bad?

    http://www.dailypress.com/news/politics/dp-nws-ga-automobile-recall-20160207-story.html


The car dealers' legislation in VA is even worse than similar legislation that was defeated by consumer and labor organizations in California and New Jersey.  That's because it also would impose a new, unprecedented burden on consumers to get the safety recalls on their vehicles repaired. For most people, that means having to time from work, losing income due to lost hours of work, and hassling over getting an appointment to have the repairs performed. Most dealers only perform repairs during regular business hours and on weekdays, making the logistics difficult for many working families. Plus if there are no repair parts available, there could be lengthy delays -- months, or even years -- before it is possible to get the defects repaired. Meanwhile, the consumer would have little choice other than to keep driving an unsafe vehicle.

Here are links to letters of opposition to the bill in CA. The same arguments also apply to the bills in VA:

Consumers for Auto Reliability and Safety

Consumers Union

National Association of Consumer Advocates

Consumer Federation of California

James Sturdevant and Former NHTSA Administrator Joan Claybrook

Consumer Attorneys of California

International Association of Machinists and Aerospace Workers

Consumer Action, CALPIRG, Housing and Economic Rights Advocates, Courage Campaign, California Rural Legal Assistance Foundation, Consumer Watchdog

Other opponents include: Trauma Foundation, Center for Auto Safety, and Advocates for Highway and Auto Safety.
 
 
Sweet Victory for Consumers
President Obama Signs Raechel and Jacqueline Houck Safe Rental Car Act
Work still needed to close car dealers' "Loaner car loophole"
 
Raechel and Jacqueline Houck were killed by a recalled rental car
After over 5 years of battles, the U.S. Congress passed the Raechel and Jacqueline Houck Rental Car Safety Act in the federal Highway Bill, known as the "DRIVE Act," and President Obama signed it into law. The Act is scheduled to take effect next June. It will prohibit nearly all rental car companies, including many car dealers, from renting, loaning, or selling recalled vehicles until the safety defects have been repaired. Existing federal law prohibits dealers from selling recalled new vehicles, but there was no similar federal law regarding rentals and loaner cars.

       The new law is a major new expansion of the National Highway Traffic Safety Administration's authority over safety recalls. For the first time, the agency will be able to police used vehicles provided by rental car companies, including car dealers, as rentals or loaners. Nearly all vehicles rented or sold by rental car companies will be required to be safe. Rental car companies are the largest purchasers of new cars in North America. They are also among the largest sellers of used cars. So this means that millions of used cars will also be safer, when they re-enter the used car market. However, thanks to a last-minute loophole added at the behest of auto dealers, the Act would apply only if the company rents or loans a fleet of 35 or more vehicles, on average – exempting many auto dealers. If a dealer rents, loans, or sells an unsafe recalled car, it would still be a violation of various state laws, but NHTSA is not able to enforce those laws.

Cally Houck has been a tireless advocate for improving rental and loaner car safety
        “I'm thrilled that we've finally passed the Rental Car Safety Act named for my beautiful, treasured daughters, Raechel and Jacqueline. But I'm worried about the loaner car loophole for car dealers and remain committed to closing that dangerous safety gap,” said Cally Houck, Mother of Raechel and Jacqueline Houck, who were ages 24 and 20 when they were killed by a recalled rental car. The leading champions for passage of the Act were U.S. Senators Schumer, Boxer, McCaskill, Nelson, and Blumenthal, and Representatives Capps, Schakowsky, Butterfield, and Jones. The Senate measure was also co-sponsored by Senators Casey, Feinstein, Gillibrand, and Markey. The Obama Administration was also strongly supportive of passage.

Sweet Victory! Greg Houck, Cally Houck, and U.S. Senator Charles Schumer commemorate passage of Raechel and Jackie's law. Sen. Schumer was a leading champion of the law.
       Thanks to the new law, the National Highway Traffic Safety Administration will be able to police rental car companies and dealers who have fleets of 35 or more rentals or loaner vehicles, and fine them if they violate the law – preventing tragedies like the crash that killed Raechel and Jackie.

       The Senate and House both rejected attempts by the auto manufacturers and car dealers to kill the bill, or to allow rentals and loaners of recalled vehicles with “disclosure,” which would merely shift liability onto the victims of unsafe vehicles. The rental car industry, including Enterprise, Hertz, Avis, Dollar-thrifty, Alamo, National, and the American Car Rental Association, as well as many smaller rental car companies, helped persuade lawmakers to vote for the Act, and worked alongside Cally Houck and CARS for passage of the new law. The lone exception was the owner of Rent-a-Wreck, Jack Fitzgerald, a car dealer, who actively opposed the bill and lobbied against its passage.

        US Rep. Roger Williams (R-Texas), a car dealer, introduced a special-interest amendment to exempt car dealers from the bill, and to allow them to rent or loan unrepaired recalled vehicles regardless how unsafe they are, or how many people they have maimed or killed, without having to worry about NHTSA enforcement. U.S. Rep. Lois Capps (D-CA), and Rep. Jan Schakowsky (D-IL) argued against the dealer loophole on the House Floor, pointing out that the amendment would mean that consumers who take a recalled car to a dealer for repairs could be loaned another recalled car with the exact same defect. Despite polling showing that the public overwhelmingly opposes this loophole, the Williams amendment passed near midnight, with few Representatives left on the House floor to cast votes, by a voice vote, with some voting “No.”

Greg Houck, Cally Houck, Senator Barbara Boxer, and Pamela Gilbert (who represents CARS in Washington, DC), celebrate passage of the Raechel and Jacqueline Houck Safe Rental Car Act. Sen. Boxer was a leading champion of the law.
       While Rep. Williams claimed that the loaner loophole would apply only to minor problems that do not affect safety, it would actually apply to ALL safety recalls, including defects such as catching on fire, brake failures, loss of steering, stalling in traffic, wheels that fall off, axles that break, child safety seat anchors that fail, seat belts that break apart in a crash, and air bags that spew shrapnel that blinds people and slices into their necks, causing them to bleed to death.

       Rep. Williams also claimed that no dealer would loan or sell an unsafe vehicle. However, many news reports have exposed cases where dealers have handed customers the keys to vehicles with potentially lethal safety defects, causing crashes and even catching a home on fire. In one tragic crash, four family members were killed by an unsafe Lexus loaner car. In Texas, Carlos Solis was killed by a recalled used car with an exploding Takata air bag when a dealer failed to get the car repaired prior to sale. CarMax, the largest retailer of used cars in the nation, openly admits that it sells large numbers of unsafe recalled vehicles without bothering to get the free safety recall repairs done first.

       According to the National Highway Traffic Safety Administration, “All safety recalls resulting from defects present an unreasonable risk to safety and we believe it is inappropriate to suggest that some defects are not risky enough to require repair. For the safety of the motoring public, all recalled vehicles should be fixed promptly.”1

SCally Houck, Rep. Lois Capps, Greg Houck, and Pamela Gilbert (who represents CARS in Washington, DC), commemorate passage of Raechel and Jackie's Law. Rep. Capps was a leading champion of the law.
       Recently, the Campaign Legal Center urged the House Ethics Committee and the Office of Congressional Ethics (OCE) to review Texas Republican Rep. Roger Williams' conduct in authoring a special-interest amendment that would benefit his own business, as a car dealer.

       The Act will improve both rental car and used car safety, by reducing the numbers of recalled rental and used cars that re-enter the used car market. However, Congress failed to close the used car safety gap, due to heavy opposition from the National Automobile Dealers Association.

       To its credit, AutoNation has publicly announced that they guarantee a recall-free vehicle, including used cars. They have also announced that they will not penalize consumers who trade in a vehicle with an open recall by dinging them over the price.

Read more: LA Times: One mother spent over a decade after her daughters' deaths changing car rental laws
 
 
 
 
 
NEWS for immediate release: December 1, 2015
Contact: Rosemary Shahan, President, CARS, 530-759-9440
 
 
Congress Nears Passage of Rental Car Safety Act in Highway Bill
Safety advocates seek to close dangerous loaner car loophole
 
      After over 5 years of battles, the U.S. Congress is nearing passage of the Raechel and Jacqueline Houck Rental Car Safety Act in the federal Highway Bill that is expected to be voted upon this week. The Act would prohibit nearly all rental car companies, including many car dealers, from renting, loaning, or selling recalled vehicles until the safety defects have been repaired. Existing federal law prohibits dealers from selling recalled new vehicles, but there is no similar law regarding rentals.

Raechel and Jacqueline Houck were killed by a recalled rental car
      Passage would be a major new expansion of NHTSA's authority over safety recalls. For the first time, the agency would be able to police used vehicles provided by rental car companies, including car dealers, as rentals or loaners – but thanks to a last-minute loophole added at the behest of auto dealers, the Act would apply only if the company rents or loans a fleet of 35 or more vehicles, on average – excluding many auto dealers.

      “I'm thrilled that we're finally close to passage of the Rental Car Safety Act named for my beautiful, treasured daughters, Raechel and Jacqueline. But I'm worried about the loaner car loophole for car dealers and remain committed to closing that dangerous safety gap,” said Cally Houck, Mother of Raechel and Jacqueline Houck, who were ages 24 and 20 when they were killed by a recalled rental car.

      The leading champions for passage of the Act are Senators Schumer, Boxer, McCaskill, Nelson, and Blumenthal, and Representatives Capps, Schakowsky, Butterfield, and Jones. The Senate measure was also co-sponsored by Senators Casey, Feinstein, Gillibrand, and Markey. The Obama Administration has also been strongly supportive of passage.

      Thanks to this provision, the National Highway Traffic Safety Administration will be able to police rental car companies and dealers who have fleets of 35 or more rentals or loaner vehicles, and fine them if they violate the law – preventing tragedies like the crash that killed Raechel and Jackie. Currently, it is a violation of state laws for rental car companies or dealers to engage in such practices, but generally those laws are not enforceable by individual consumers or their survivors unless they have suffered damages, such as property damage, personal injury, or death. NHTSA will be able to act without having to wait for a crash to occur.

      The Senate and House both rejected attempts by the auto manufacturers and car dealers to kill the bill, or to allow rentals and loaners of recalled vehicles with “disclosure,” which would merely shift
 
 
 
 
 
liability onto the victims of unsafe vehicles. The rental car industry, including Enterprise, Hertz, Avis, Dollar-thrifty, Alamo, National, and the American Car Rental Association, as well as many smaller rental car companies, helped persuade lawmakers to vote for the bill. The lone exception was the owner of Rent-a-Wreck, Jack Fitzgerald, a car dealer, who actively opposed the bill and lobbied against its passage.

      US Rep. Roger Williams (R-Texas), a car dealer, introduced a special-interest amendment to exempt car dealers from the bill, and to allow them to rent or loan unrepaired recalled vehicles regardless how unsafe they are, or how many people they have maimed or killed, without having to worry about NHTSA enforcement. U.S. Rep. Lois Capps (D-CA), and Rep. Jan Schakowsky (D-IL) argued against the dealer loophole on the House Floor, pointing out that the amendment would mean that consumers who take a recalled car to a dealer for repairs could be loaned another recalled car with the exact same defect. Despite polling showing that the public overwhelmingly opposes this loophole, the Williams amendment passed near midnight, with few Representatives left on the House floor to cast votes, by a voice vote, with some voting “No.”

Cally Houck has been a tireless advocate for improving rental and loaner car safety
      While Rep. Williams claimed that the loaner loophole would apply only to minor problems that do not affect safety, it would actually apply to ALL safety recalls, including defects such as catching on fire, brake failures, loss of steering, stalling in traffic, wheels that fall off, axles that break, child safety seat anchors that fail, seat belts that break apart in a crash, and air bags that spew shrapnel that blinds people and slices into their necks, causing them to bleed to death.

      Rep. Williams also claimed that no dealer would loan or sell an unsafe vehicle. However, many news reports have exposed cases where dealers have handed customers the keys to vehicles with potentially lethal safety defects, causing crashes and even catching a home on fire. In one tragic crash, four family members were killed by an unsafe Lexus loaner car. In Texas, Carlos Solis was killed by a recalled used car with an exploding Takata air bag when a dealer failed to get the car repaired prior to sale. CarMax, the largest retailer of used cars in the nation, openly admits that it sells large numbers of unsafe recalled vehicles without bothering to get the free safety recall repairs done first.

      According to the National Highway Traffic Safety Administration, “All safety recalls resulting from defects present an unreasonable risk to safety and we believe it is inappropriate to suggest that some defects are not risky enough to require repair. For the safety of the motoring public, all recalled vehicles should be fixed promptly.”1

      Recently, the Campaign Legal Center urged the House Ethics Committee and the Office of Congressional Ethics (OCE) to review Texas Republican Rep. Roger Williams' conduct in authoring a special-interest amendment that would benefit his own business, as a car dealer.

      The Act will improve both rental car and used car safety, by reducing the numbers of recalled rental and used cars that re-enter the used car market. However, Congress failed to close the used car safety gap, due to heavy opposition from the National Automobile Dealers Association.

      To its credit, AutoNation has publicly announced that they guarantee a recall-free vehicle, including used cars. They have also announced that they will not penalize consumers who trade in a vehicle with an open recall by dinging them over the price.
__________________
1   Official statement issued by the National Highway Traffic Safety Administration, April 4, 2011
 
 
 
 


Car dealer Congressman's loophole for dangerous
recalled rental and loaner cars
Leads to call for ethics investigations
 
Defective Lexus loaner car kills 4 family members within hours of when Bob Baker car dealership hands CHP Officer Mark Saylor the keys
A nationally recognized government-ethics watchdog organization based in Washington, D.C., the Campaign Legal Center, is urging the House Ethics Committee and the Office of Congressional Ethics (OCE) to review Texas Republican Rep. Roger Williams' conduct in authoring a special-interest amendment that would benefit his own business, as a car dealer. He pushed the amendment through near midnight during debate on the House Floor over the Raechel and Jacqueline Houck Safe Rental Car Act. The amendment would grant car dealers a special exemption from the Act, allowing them to rent or loan unsafe recalled vehicles to the public, without having to wait to get the safety defects -- such as exploding Takata air bags, catching on fire, faulty brakes, or steering loss -- repaired first.

The Center stated in a news release: “Members creating carve-outs that directly benefit their own business interests severely undermines the public’s belief that Members of Congress are acting in the public interest,” said Meredith McGehee, Campaign Legal Center Policy Director. “The specific actions of Rep. Williams must be reviewed for compliance with current rules, but even if he did clear his amendment with the Ethics Committee, his actions are a prime example of why the current rules are both too weak and in need of further clarification.”

The Center issued a letter to Ethics Committee Chair Charles Dent (R-PA) and Ranking Member Linda Sanchez (D-CA) and OCE Co-Chairs David Skaggs and Judy Biggert, urging a review of Rep. Williams’ conduct. The Center also asked the Committee to recommend changes to clarify House rules concerning recusal [removing oneself from participating in the debate and / or vote] and conflicts of interest by Members.

Read more: Legal Center calls for review of loaner car loophole amendment by U.S. Rep. Williams

Read more: Campaign Legal Center letter seeks ethics review
 
 
 
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Buyer beware!  
NEVER trust that a dealer will have the safety recall repairs performed before selling you a car that is being recalled. Dealers are so eager to make a buck, fast, they are unwilling to delay sales long enough to get the safety recall repairs done -- for FREE.

Plus -- dealers are actively opposing legislation in Washington, DC and in California that would prohibit them from renting, selling, leasing, or loaning unsafe, recalled vehicles to consumers, unless the safety recall repairs have been performed first.

CARS’ tips on how to buy a safe, reliable used car — without having to risk going to a dealer:

Top 12 used car buying tips

Dealers playing “used car roulette” with customers’ lives — and opposing legislation to make them stop

Did a dealer sell you an unsafe, recalled car? We want to hear your story. Contact CARS

 
Buyer Beware! Auto dealers' one-
sided contracts can ruin your life
Even if the dealer breaks the law, you might not be able to get justice. Forced arbitration clauses hidden in the fine print can keep you tied up for years. The dealer even gets to pick the arbitrator who hears your case. Here's what happened to a car buyer in San Diego:
Think this is outrageous? Call your member of Congress at 202-224-3121, and urge them to vote for the Arbitration Fairness Act. More about the AFA, now pending before Congress:
http://www.fairarbitrationnow.org
 
Here's what we're doing to bring
more attention to Jon's plight:
UsedCarNightmare.org
 
Used Car Nightmare logo

Jon Perz has started a new petition
on the Change.org website
 
You're invited to check it out and send a message letting Mossy Toyota know what you think.
used car nightmare petition


 
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