WASHINGTON - Another effort to pass federal legislation requiring uniform marking of titles for salvaged cars and trucks has been launched - with a major push from the National Automobile Dealers Association.
'If a customer discovers that the used car he or she purchased has been rebuilt and returns the vehicle, the dealer must either take the vehicle back and refund the purchase price or risk incurring a lawsuit that he would likely lose,' said Dick Strauss, former NADA president, in testimony prepared for a congressional hearing last week.
A 1994 federal study, which recommended congressional action, said data from some states showed that as many as 70 percent of wrecked cars and trucks were repaired and resold, often in other states without disclosure.
It estimated annual losses at $4 billion - to dealers, who may acquire the vehicles at auctions or in trades, and to consumers, who ultimately own them.
Linda Winters, lobbyist for NADA, said the reselling of wrecked vehicles as if they were undamaged artificially inflates all used-car prices.
Several bills have been introduced this year to require that states use uniform markings, or 'brands,' on titles for vehicles that were repaired after salvage. Some would also require permanent decals on rebuilt vehicles' doorjambs.
The major threat to passage of any one of them is disagreement among interest groups over where lines should be drawn.
A bill introduced by Senate Majority Leader Trent Lott, R-Miss., would, for example, require title branding if the cost of repairing a vehicle reached at least 75 percent of its value before the damage.
Janet Bachman, vice president for claims administration at the American Insurance Association, said her organization 'will not negotiate below 80 percent.' Some consumer organizations have said the figure should be 65 or even 50 percent.
In addition, the major bills on the issue, Lott's and that of Rep. Rick White, R-Wash., in the House, would not apply to vehicles more than seven years old or worth less than $10,000.
Tracy Mattson, director of governmental affairs for the Automotive Recyclers Association, said protection should also extend to the buyer of a 1990 Honda worth $8,000.
The recyclers also want a provision that would declare as 'nonrepairable' any vehicle that has sustained damage of 90 percent or more of its value. The association said the provision would help prevent unsafe vehicles from being repaired, and would deter theft.
The Automotive Recyclers Association and others say that car thieves sometimes buy the severely damaged vehicles at extremely low prices so that they can switch vehicle identification numbers to stolen cars and trucks.
Pete Lukasiak, executive director of the National Auto Auction Association, said one reason the legislation stalled in the last session of Congress was the reluctance of then-new GOP leaders to impose mandates on the states.