- Associated Press - Monday, November 1, 2010

The Federal Trade Commission is being asked to explain why the rental-car industry shouldn’t have to live by the same rule that requires auto dealers to fix vehicles facing a recall notice before they can be sold.

Two consumer groups and New York Democratic Sen. Charles E. Schumer have asked the FTC to force the country’s largest rental company, Enterprise Holdings Inc., to fix vehicles under recall before renting them out. Enterprise Holdings is the parent company of rental-car companies Enterprise, National and Alamo.

Safety groups say most business travelers or those renting cars for long trips don’t know whether their vehicle has been the subject of a recall, posing a potential safety threat. The issue has taken on more significance this year after a series of safety recalls by Toyota Motor Co. and several large recalls involving other automakers.

Mr. Schumer asked the FTC on Monday to end the practice across the industry, telling the federal agency in a letter that “if automotive dealers are not allowed to sell recalled vehicles without first fixing the safety issues, then rental-car companies should be held to the same standard.”

“If a car is not safe enough to be bought and driven off the lot, then it is not safe enough to rent,” Mr. Schumer wrote. If the FTC “can’t or won’t act, Congress will.”

In August, two groups, the Center for Auto Safety and Consumers for Auto Reliability and Safety, petitioned the FTC to direct Enterprise Holdings to change its policies and take recalled vehicles out of the rental fleet until they are fixed. They contend rental-car companies put off recall repairs because it hurts business.

“The concept is real simple. If the car is not on the road, it’s losing money,” said Clarence Ditlow, president of the Center for Auto Safety. “So they want to schedule a recall repair when it’s convenient for them.”

Enterprise Holdings, which has the nation’s largest fleet with 1.1 million vehicles, said it parks vehicles and declines to rent them when auto manufacturers make that recommendation. Automakers typically tell owners to contact their dealers to schedule a service appointment, but rarely tell all owners to stop driving their vehicles until they do so.

Enterprise spokeswoman Laura Bryant said the company’s “practice frequently goes above and beyond what is required” and noted that Enterprise grounded more than 30,000 recalled Toyota and Pontiac vehicles earlier this year. “In most cases, we place a ‘hold’ on recalled vehicles so they are not rented until the recall work is completed,” she said.

The FTC declined comment on the petition.

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