GM Announces Support for Bill Banning Rental, Sale of Unrepaired Recalled Cars

Office of U.S. Sentator Charles Schumer, July 16, 2014

General Motors is First Major Car Manufacturer to Support Bill Closing Dangerous Loophole

Schumer: GM’s Support for Our Bill Shows the Real Danger of Having Defective Cars on the Road and Opens Door for Other Manufacturers to Endorse the Bill and Keep Consumers Safe

U.S. Senator Charles E. Schumer (D-NY) has announced that General Motors is the first major car manufacturer to support his legislation that would close a dangerous loophole and prohibit rental car companies from renting or selling vehicles under manufacturer recall. The legislation is co-sponsored by Senator Barbara Boxer. Current law bans only auto dealers from selling a new car under recall unless the defect has been remedied.

The Raechel and Jacqueline Houck Safe Rental Car Act would, for the first time, hold rental companies to the same standard as auto dealers.

The bipartisan legislation, which already has the support of all the major rental car companies, the American Car Rental Association, Consumers for Auto Reliability and Safety and a broad coalition of auto safety and consumer groups, was first introduced in 2013 by Senators Schumer, Lisa Murkowski and Barbara Boxer.  The bill is named after sisters Raechel and Jacqueline Houck who were killed driving a rental car that had been recalled for a power steering hose defect but had not been repaired.

General Motors announced its support for the legislation in a letter to Senator Schumer. It comes after bill sponsors negotiated new legislative language to make clear the authors’ original intent not to change the status quo or interfere with contractual obligations between the auto manufacturers and rental companies regarding loss of use liability.

“When buying or renting a car, the last thing we should worry about is if the car is defective or recalled,” said Senator Schumer. “I thank General Motors for endorsing our common sense legislation and hope it opens the door for more car manufacturers to do the right thing and support our bill to keep consumers safe.”

“The safety of anyone who drives or rides in a GM vehicle is extremely important to us,” said GM CEO, Mary Barra.  “We have worked constructively with Senator Schumer, and the cosponsors of The Raechel and Jacqueline Houck Safe Rental Car Act. Through those conversations we have addressed our concerns, and with changes agreed to by the sponsors, GM is able to support their legislation. If enacted, it will give those who rent a vehicle, regardless of make or model, the peace of mind that the car they are in is safe.”

“I welcome GM’s support for Senator Schumer’s bill, named after my treasured daughters and co-sponsored by my Senator Barbara Boxer,” said Carol “Cally” Houck, mother of Raechel and Jacqueline Houck. “It’s time for the rest of the auto manufacturers and the auto dealers to follow the rental car industry, and GM, and support the bill.”

“General Motors’ endorsement is an important step in our campaign to pass the Raechel and Jacqueline Houck Safe Rental Car Act and keep unsafe rented vehicles off the roads,” Senator Boxer said. “Today I am calling on all the other automakers who currently oppose this common-sense bill to join GM in supporting this effort to protect American families.”

A copy of the letter from Lee R. Godown, Vice President of Government Relations at General Motors, indicating support for the legislation can be found below:

Dear Senator Schumer:

On behalf of General Motors, I would like to thank you, as well as the cosponsors, for reviewing our proposed changes to S. 921 as described in my June 26, 2014, letter to you (herewith again attached).

With these changes made to the committee-reported text of S. 921, “The Raechel and Jacqueline Houck Safe Rental Car Act of 2013,” such a revised bill will have the support of General Motors.

Let me offer our appreciation to you, as well as to your staff for their professionalism, as we worked through this process.

Sincerely,

Lee R. Godown
Vice President
Global Government Relations

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