Buyers beware: Pre-loved cars often sold with unfixed defects
It's a case of buyer beware, with potentially dangerous consequences.
More than 46 million cars and trucks on the road in the US- about one-fifth the total - were recalled because of safety defects but never repaired, according to a study by Carfax, a company that sells vehicle history reports. Some of those defects have the potential to cause a crash, injury, even death.
Last year, around 5 million of those cars were sold to new owners.
That's because there is no legal requirement for dealers or individual sellers to get the repairs done before a used car is sold. They are not even obligated to tell buyers if a car is subject to a recall.
"It's a very major public safety problem," says Chris Basso, a used-car specialist for Carfax, which analyzed state registration data to determine that one-fifth of the 238 million cars on the nation's roads has an unrepaired problem that was the subject of a recall. "When those recalled cars go unfixed, they compound over the years, and it increases the chance of those parts failing."
Federal regulators are pushing for legislation that requires dealers to fix recalled used cars. Independent dealers oppose such a measure but say they might go along with a requirement to disclose recalls to buyers because a new government database makes it easier to tell if a car on their lot has been recalled.
The number of unfixed cars is certain to rise because automakers recalled nearly 64 million vehicles nationwide last year, double the old record set in 2004. Government data show that 25 percent of car owners never get recall repairs done.
No one is sure how many crashes or injuries happen because of unheeded recalls. But buying an unrepaired car cost Carlos Solis his life. The 35-year-old father of two died Jan. 18 when shrapnel from the driver's air bag in his 2002 Honda Accord tore into his neck after a minor accident near Houston.
Solis' Accord had been recalled in 2011 to fix a faulty air bag inflator made by Takata Corp. that can explode with too much force. But neither the two previous owners, nor the independent dealer in Houston who sold Solis the car last April, had the repair done.
Solis had no other injuries, says Rob Ammons, an attorney representing his family in a lawsuit against Takata, Honda and the dealer. "You fix the defective air bag and he doesn't die," Ammons says.
Federal law requires car companies to notify owners of a recall within 60 days of finding a safety defect, which Honda did in 2011. But there's no legal requirement that companies contact the new owner if a car changes hands.
John Castro, 36, of Glen Burnie, Maryland, traded a pickup truck for a 2011 Toyota Prius in March of last year at Koons Ford in Baltimore.
Shortly after he took the car home, he read a dealer-provided Carfax report and found that his car had been recalled in February 2014 to fix a hybrid component that could malfunction and cause stalling. Koons had not done the repair, and no sales person mentioned the recall, Castro says.
"You think when you buy something, it's been checked and cleared," he says.
Dennis Koulatsos, Koons Ford general manager, says Castro's car should have been fixed because there was a safety issue. All dealers, he says, have incentives to fix recalled cars. They could lose customers to dealers who do, or they could be sued if something goes wrong.
But he also thinks dealers should be able to sell cars with open recalls if the problems don't affect safety or drivability. "Used cars are hard to get, and they depreciate by the day when they sit on the lot," he says.
A number of attempts to pass laws requiring dealers to fix recalled cars or disclose problems have stalled under opposition from carmakers, auto dealers and the U.S. Chamber of Commerce. Mark Rosekind, the new head of the National Highway Traffic Safety Administration, and Transportation Secretary Anthony Foxx are making another push.
"We cannot allow vehicles with potentially dangerous defects to leave used-car lots without the necessary repairs," Rosekind says.
Used-car dealers fought past legislation because they didn't have access to a national database to check for recalls, says Steve Jordan, CEO of the 16,000-member National Independent Automobile Dealers Association.
That changed in August when the government set up a website for dealers and drivers to check recalls by keying in the 17-digit vehicle identification number. Now, Jordan says the association may support a disclosure law, as long as the database allows dealers to check multiple numbers at a time to save time and labor.
The association still opposes a repair requirement because independent dealers would be at the mercy of competitors franchised by automakers. Those dealers are the only ones authorized to do recall repairs.
The National Automobile Dealers Association, which represents new-car dealers that sell used cars, hasn't taken a position on the repair requirements. It is waiting for the government to estimate the cost, the effect on sales and whether the measure would save lives.
Individual sellers won't face any repair or disclosure requirements. Individuals sold just under one-third of the 42 million used cars in the U.S. last year, according to the Strategic Vision research firm.
Last year, a Honda executive floated the idea of requiring recall repairs before license plates can be renewed. That's similar to the practice in Germany, where the government can revoke registrations of cars with outstanding recalls.
U.S. federal law does require dealers to make recall repairs on new cars before selling them.
CarMax, the nation's largest used-car dealership chain, says it informs buyers of open recalls, but it does not get the vehicles repaired. AutoNation, the largest dealership group in the U.S., says it repairs recalled used cars before selling them when parts are available. If there are no parts available, it discloses that to buyers and tells them of any danger.
AutoNation CEO Mike Jackson says he favors laws requiring disclosure.
"The recall situation is a mess. It's a disgrace and it's a black eye for the industry," he says.
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