Controversy builds over renting out recalled cars

Federal lawmakers are considering legislation to require rental car companies to immediately take cars off the road that have been recalled for safety defects. Rental agencies object, saying the bill is bolstered by inaccurate numbers.

The controversy over recalled rental cars was sparked in June when an Alameda County Superior Court jury ordered Enterprise Holdings Inc. to pay $15 million to the parents of two young women who died in a 2004 crash involving an Enterprise rental car.

A month before Enterprise Rent-a-Car rented a PT Cruiser to Raechel Houck, 24, and her sister Jacqueline, 20, the rental agency had been notified that the car was being recalled because power steering fluid could leak and ignite under the hood. The two sisters died in a fiery crash.

Sen. Charles Schumer (D-N.Y.) cited the accident as a reason Congress should adopt his bill to bar agencies from renting out cars that have been recalled because of safety issues. Current law prohibits car dealers from selling a recalled vehicle, but the law doesn’t address rental car agencies.

Schumer also pointed to a study by the National Highway Traffic Safety Administration that is still underway. Looking at 10 recalls by General Motors and Chrysler from 2006 to 2010, the study showed:

Hertz Rent-a-Car fixed only 34% of its vehicles affected by those recalls within 90 days. Avis Car Rental and Budget Rent a Car fixed 53% and Enterprise fixed 65% in the same time frame.

“The study suggests that tens of thousands of rental car drivers have unknowingly rented vehicles under recall, posing a serious threat to safety on the roadway,” Schumer said in a statement this month when he offered his bill, the Safe Rental Car Act.

An Enterprise spokeswoman said her company believes that the law would be unnecessary, adding that Enterprise already fixes recalled cars quickly.

Five major car rental firms — Alamo, Avis Budget, Enterprise, Hertz and National — dispute the NHTSA study. In a letter to the agency, they said the repair rates cited on its website were based on inaccurate information submitted by auto manufacturers.

The rental car companies sent NHTSA letters showing much higher repair rates for the recalled cars.

Enterprise told NHTSA that in one GM recall last year, for example, it fixed 72% of its affected cars within 30 days and 93% within 90 days.

A spokesman for NHTSA declined to comment, saying the study was ongoing.

• More business trips, worse airline service?

Business travel is on the rise after a long decline caused by the global recession, but North Americans say the quality of airline service seems to be dropping, a new survey suggests.

The survey of more than 380 business travelers in North America, Asia and Europe was released last week by London aerospace consultant Ascend. It was the latest in the last few months to show that businesses were emboldened by a stronger economy to spend on travel.

In the Ascend survey, nearly half of those questioned said they expected to travel more this year than in 2010. The survey also found that fewer companies were cutting travel budgets and limiting the number of conferences that employees can attend.

However, 70% of the North American travelers surveyed said the quality of airline service declined over the last year.

And things may get worse, according to 70% of all the travelers surveyed, who said they feared that the consolidation of airlines over the last few years would result in fewer choices and higher ticket prices.

• Travelers crave child-free vacations

Family vacations are back, but some travelers would prefer to leave the kids at home.

The travel website TripAdvisor found that 83% of U.S. travelers surveyed said they planned to take a least one family vacation this year. That’s up from 79% in 2010.

But in the survey of 1,600 travelers, 43% of those with children admitted that they would often prefer to take vacations without the kids.

In fact, nearly a third of those surveyed said they would pay extra for child-free sections of airplanes, pools and restaurants. And 22% said they would even pay for a spot on a beach free of any children.

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