If you’re shopping for a used car, caveat emptor: You could buy one with a safety defect that could’ve been fixed by a free repair as part of a recall.
It’s easy to use the vehicle identification number, or VIN, to determine whether the vehicle you’re about to buy has a potentially lethal Takata airbag, for instance, but the seller isn’t required to make the repair, or even tell you the car needs it.
Not every recall is a matter of life and death, but ignoring one courts disaster. Let the buyer beware.
Federal law requires that all new-car dealers fix any safety recall before sale, lease or rental, but there’s no requirement for used vehicles, which account for 30 million to 40 million sales a year, far more than new vehicles.
“Buyers should feel confident the vehicles they buy are safe,” said David Bennett, AAA repair systems manager. “If the manufacturer issues a recall, repairs should be performed as expeditiously as possible.”
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There are proposals to require the repairs before sale, but the issue is less straightforward than you might think. It can take months or years to get parts for some recalls, and requiring repairs could make it harder for owners to trade in vehicles, reduce their value or raise the cost of used cars.
A ‘trade-in tax’?
“Without a rule, consumers need to be their own advocates for this,” said Becky Mueller, senior research engineer with the Insurance Institute for Highway Safety. “They need to be vigilant about recalls as buyers and as owners. Part of shopping for a used vehicle should be checking for recalls and asking for proof the vehicle has been repaired before purchase. You can’t emphasize this too much. There will always be new recalls. Be your own advocate.”
It’s easy to look up the VIN for recalls on a vehicle at the National Highway Traffic Safety Administration’s Safercar website.
The National Auto Dealers Association cited a study by JD Power that said requiring recall work to be completed before sale could reduce the average trade-in by $1,200. The figure that could rise to $7,000 for some vehicles in what NADA calls a “trade-in tax” that would take money out of people’s pockets.
“A dealer might have a car on hand for weeks, months, longer,” said Robert Levine, director of dispute counseling for consultant Stout.
Only franchised new vehicle dealers are allowed to make recall repairs, for which the automaker pays them. A Chevy dealer that takes a Honda with an outstanding recall in trade can’t make the repairs and bill Honda. It may not even know about the recall. Each automaker notifies its dealers privately about recalls and how to make the repairs. Automakers typically reimburse dealers for recall work at a lower rate than regular customers pay, reducing the incentive to get cracking on repairing a recalled vehicle brought in by a competitor.
Wasn’t this car already recalled?
On top of that, big recalls – which frequently include millions of vehicles – are a logistical nightmare. It can take years to get parts, often because the supplier that made them is fully occupied making parts for new cars.
In what’s got to feel like the ultimate Catch-22 for owners, some vehicles that were recalled early in the Takata air bag saga got a temporary repair. It’s wearing out, and they’re being recalled again for the permanent fix.
“If you’ve got 500 used vehicles in stock, you may be certain that none had a recall when you purchased it, but that could change tomorrow,” Levine said. A dealer might expect to sell a popular trade-in quickly, only to have it sit in inventory for weeks or months when a recall was announced. “Dealers would have to perform almost constant VIN checks on their inventory.”
A bill in New York’s Legislature would require franchised and independent dealers to complete safety recalls. It could reach Gov. Andrew Cuomo this year. U.S. Sens. Richard Blumenthal, D-Conn., and Ed Markey, D-Mass., have repeatedly introduced federal legislation, to no effect.
None of the proposals addresses private sales from one individual to another or ownership transfers within a family.
“This is an untenable situation that fundamentally puts consumers at risk,” said William Wallace, Consumer Reports manager of home and safety policy. “It’s a clear safety loophole that makes consumers responsible for something the manufactures should address.
“There should be a federal law to address this, but I’m optimistic this loophole will be closed one way or the other, through federal or state laws.”