Are Uber and Lyft Driving Recalled Cars?

Originally published in The American Prospect on July 8, 2015.
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ber and Lyft—two popular ride-sharing companies sweeping cities worldwide—work hard to market their transportation services as safe and secure. On Lyft’s website, the company boasts, “As pioneers in transportation, we’re changing the industry with safety front of mind.” Touting their mandatory inspection requirements, like driver criminal background checks, the company declares: “We designed safety into every part of Lyft.” Uber’s rhetoric is quite similar. “From the moment you request a ride to the moment you arrive, the Uber experience has been designed from the ground up with your safety in mind,” their website states. Phillip Cardenas, the Head of Global Safety at Uber says that while his company is committed to continually improving its policies, he believes Uber has “built the safest transportation option in 260 cities around the world.”

Over the past year I’ve spent a lot of time looking into the growing number of recalled but unrepaired vehicles on the road. Auto manufacturers and the National Highway Traffic Safety Administration (NHTSA) issue safety recalls when they determine that a vehicle or particular piece of motor vehicle equipment creates an unreasonable safety risk or fails to meet minimum safety standards. But while manufacturers must repair recalled vehicles for free, consumers are not actually required to fix their cars—and many don’t. At the end of 2014, Carfax estimated 46 million cars were on the road with unfixed safety recalls.

Reformers have been working to close many of the regulatory loopholes in American auto recall policy. For example, while it’s long been illegal under federal law to sell recalled new cars, no such law exists for used cars, and more than 35 million used vehicles are sold annually. Advocates have been pushing Congress to ban this practice, though most car dealerships remain staunchly opposed. In the rental car world, under federal law, companies can still legally rent cars with unfixed safety recalls, however Hertz, Avis, and Enterprise—which account for more than 90 percent of the rental car market—pledged in 2012 to stop doing so.The companies also support federal legislation that would ban renting recalled cars, but the bill is stalled in Congress. While no such legislative effort exists for ride-sharing companies, I started to wonder, well what about Uber and Lyft? Where do they stand on auto recall reform?

Uber and Lyft’s Weak Defenses

It turns out that despite Uber and Lyft’s public rhetoric about safety, consumers that use these services may be riding in vehicles with unfixed safety recalls. Neither company requires its drivers to repair recalled cars; in fact, the mandatory safety inspections do not even involve checking to see if a car has been recalled. (To check, one would enter a vehicle’s 17-digit VIN number online.)

I reached out to Uber and Lyft to ask whether they allow drivers to work for them with unfixed safety recalls, and what steps the companies take to keep track of recalled cars in their fleets. It’s possible, for example, that a manufacturer could issue a recall for an Uber driver’s car a year or two after the driver has already been working for the company. How does Uber keep track of this? Do they keep track?

An Uber spokesman responded: “Manufacturers notify vehicle owners of recalls. Uber doesn’t own vehicles, we provide a technology platform to help connect drivers—who are independent contractors—with riders. It’s important to note that drivers on the Uber Platform are expected to meet and maintain all vehicle safety standards.”

Chelsea Wilson, a spokesperson for Lyft, told me: “Lyft drivers use their personal vehicles to drive on the platform—the same car they use in their daily lives, driving their kids to school or friends around town. Drivers have a strong personal incentive to make sure their car is in a safe operating condition. In addition to the safety inspection conducted by Lyft, drivers make a continuous representation that their vehicle meets the industry safety standards and all applicable state department of motor vehicle requirements of its kind.”

So Uber says that their car inspections do not include checking for safety recalls because manufacturers will notify vehicle owners if there’s a problem. But what if an Uber driver owns a used car? One of the biggest issues with auto recalls in the U.S. is that manufacturers cannot send secondary car owners mail notices because driver privacy protection laws shield their contact information. Ideally the state would pick up this responsibility, but for now this has meant that many used car owners never learn their car has been recalled. Unless Uber required all their drivers to operate new cars—which it doesn’t—then claiming manufacturer notifications will be sufficient is incorrect.

Moreover, as we’ve seen, even if drivers are aware that their car has an open safety recall, many do not feel compelled to take their car in to be fixed. If Uber wants to ensure that all their cars are actually safe, then presumably they would require each car inspection to include checking for safety recalls, and make the repair of any outstanding recall a requirement for passing the company’s safety inspection.

Lyft suggests that because their drivers use their own cars, there are strong “personal incentives” to ensure that recalled vehicles will be fixed, even if Lyft doesn’t mandate it. But the reason that millions of cars aren’t getting repaired isn’t because they aren’t personal vehicles—most of them are—it’s because owners don’t know they have a recall, or because owners don’t have the time, resources, or will to get their cars fixed.

Legal Liability

Ignoring safety recalls may also put ride-sharing services in murky legal territory in the event of an accident. What happens for instance if a passenger is injured in an Uber or Lyft car that has an unfixed safety recall? Who could be held liable?

I asked Taras Rudnitsky these questions, a former car safety engineer who now works as a consumer justice attorney for victims in auto accidents. According to Rudnitsky, even though the drivers are classified as independent contractors, both the driver and the ride-sharing company could be liable for damages if a passenger was hurt in a recalled car.

In the case of the driver, Rudnitsky explains, a jury would determine whether the driver’s actions fell below the standard of care a reasonable person would take in the same circumstances. “If you’re going to be making money off of your car rides, shouldn’t you make sure your car is in good shape?” he asks. Even if Uber or Lyft didn’t require the driver to check for safety recalls, given that the individual sought to profit from rides that consumers believed to be safe—a driver could certainly be found guilty of negligence in the event of a preventable auto recall accident.

In other words, the fact that Uber and Lyft aggressively market themselves as safe companies reinforces the need for them to prohibit unfixed recalled vehicles from operating within their ride-sharing fleets.
The next question is whether a victim could reasonably go after Uber or Lyft, too. For this, Rudnitsky believes a victim could probably make a strong case that the ride-sharing companies were negligent and fraudulent. “This isn’t just something where an inadvertent accident happened. [These companies] are affirmatively making a case about the safety of these rides with the intention of getting people to call them for business,” he says. In other words, the fact that Uber and Lyft aggressively market themselves as safe companies reinforces the need for them to prohibit unfixed recalled vehicles from operating within their ride-sharing fleets.

“I had never thought about it before, but there’s an awful lot of culpability,” muses Rudnitsky.

Ways To Change Their Policies And Keep Roads Safe

The good news? This is an easy policy fix for Uber, Lyft, and other ride-sharing services to make. In order to ensure that all their cars are safe not only for consumers, but also for other riders on the road, Uber and Lyft should formally prohibit their drivers from using ride-sharing technology until they have repaired any outstanding safety recalls.

Beyond that, Uber and Lyft should instate procedures to ensure that they know exactly which cars in their fleets have unfixed safety recalls at all times, even beyond the initial safety inspection. Since new recalls are announced often, the companies could hire staff to regularly check the VINs in their fleets with NHTSA’s data. Alternatively they could rely on vehicle history reporting services that send regular updates on new auto safety recalls. Another option is AutoAp—a tech company that automatically sends alerts when new safety recalls are announced that match specific VIN numbers you wish to track.

Moreover, Uber and Lyft could follow the example set by the big rental car companies and press for legislation that would formally ban ride-sharing drivers from taking passengers around in unsafe recalled vehicles.

All of these changes would improve auto safety, and none would be too difficult to implement. Why wait?

Reckoning with the New Auto Recall Bill

Originally published in The American Prospect on March 19th, 2015.
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Some 46 million vehicles nationwide—nearly one in five on the road today—have a recalled, but unrepaired, safety issue. That’s because drivers, along with auto dealers and rental companies, have no legal obligation to fix safety recalls—a gaping regulatory loophole that puts millions at risk. For years lawmakers have more or less ignored the issue, until earlier this month, when Democratic Senators Richard Blumenthal and Edward Markey introduced the Repairing Every Car to Avoid Lost Lives (RECALL) Act. The bill would require car owners to comply with all pending safety recalls in order to reregister their vehicles with the DMV, a commonsense approach that would make roads safer. Yet while the new bill represents a critical step forward towards addressing our recall problem, it also raises troubling questions about how recalls are conducted and what the responsibility of manufacturers is to repair safety defects.

Undoubtedly the bill comes at a critical time. More vehicles were recalled in 2014 than ever before, 63.95 million in total. This more than doubled the previous record of 30.8 million vehicles, thanks to General Motors’ faulty ignition switches and Honda’s defective Takata airbags. Under current law, most of these cars are unlikely to be fixed; in 2011, the Government Accountability Office (GAO) found the annual recall compliance rate in the United States averages 65 percent.

In the Fall 2014 issue of The American Prospect, my article “Road Hazard: Recalled but Not Repaired” explored the politics behind this growing public health issue, and I suggested that policymakers consider making registration renewals contingent on repairing outstanding safety recalls. This is how it’s handled in Germany, and as a result their recall compliance rate stands at 100 percent. At the time of publication, no legislator indicated interest in tying auto recall repairs to annual vehicle registration. The vast majority of political energy was spent on trying to increase manufacturer penalties and improve consumer notification systems.

Six months later, two senators introduced a bill that would do just what I had suggested. Honda even came out in support, saying that this “initiative will help us all achieve the critical goal of completing 100 percent of every automotive recall campaign in America.”

Keith Crain, the editor-in-chief of Automotive News, wrote an editorial in support of the bill, praising it for its simplicity. “It should be enacted by Congress and implemented by all 50 states as quickly as possible,” Crain said. “It just makes good sense.”

However, upon a closer inspection, it’s clear that there are several issues with the RECALL Act, perhaps precisely because of its simplicity. It’s encouraging that legislators are starting to see consumer responsibility as part of the solution to our recall crisis, yet as it’s currently written, the proposed bill may lead to a whole new set of problems.

If this bill were enacted millions of people would have to get their cars repaired, or else they would be put in the position of driving their cars illegally. It’s the right idea in principle, but we’d need to ensure that people actually have the supports necessary to meet these new standards. As of now, the bill’s three listed exceptions to getting your car repaired are too vague. You may be exempt if you weren’t notified of the recall when the registration renewal came out, if the manufacturer lacks the parts or labor to complete the recall, or if you’ve demonstrated that you had no reasonable opportunity to fulfill the recall. If you fall under one of these categories, the DMV could grant you a temporary registration of up to 60 days.

But these conditions raise more questions than answers. How could you prove that the parts were not available? How often do you have to call the dealer to check in? Every day? Do you need to check in with every dealer in your state? Within a certain radius? What constitutes a “reasonable opportunity”? Will manufacturers provide consumers with loaner vehicles? What if you need longer than 60 days? Given that there were many reports of consumers waiting for months for new GM ignition switches to arrive at their local dealerships, these details matter—especially when the consequence would mean losing the ability to drive your car lawfully.

Questions about how manufacturers may use this bill to shirk legal liability in the event of auto accidents should certainly be reckoned with sooner rather than later.

Moreover, the bill also raises troubling legal questions. An auto safety advocate, whom I spoke with on background, laughed when I asked them for their thoughts on the bill. “Of course Honda supports it! It totally shifts liability away from the manufacturer and onto the consumer,” they said. Questions about how manufacturers may use this bill to shirk legal liability in the event of auto accidents should certainly be reckoned with sooner rather than later.

Newer cars are more likely than older cars to have safety recalls repaired. One of the primary reasons for this is that the car manufacturers lack the ability to mail notices to anyone who purchases their car on the used car market. (There are approximately 30 million consumers who purchase used cars each year.) Under the Driver Privacy Protection Act, auto manufacturers are barred from learning the personal information of secondary owners, so therefore when recall notices go out, most people with older cars do not hear about it. Consequently, the only real way to notify used car owners by mail would be for the state to step up and take on this responsibility. In that respect, the Blumenthal-Markey bill represents a very good step towards fixing our recall notification problem, and experts think it could substantially reduce the number of unrepaired vehicles on the road.

But while the bill would require significant changes to the DMV registration process, it comes with no additional state funding to implement them. In effect, it’s an unfunded mandate. Many state DMVs rely on outdated computer systems, and building the capacity to process millions of auto recalls alongside their registration process—though it’s a smart and feasible idea in theory—requires resources. The bill also threatens to reduce states’ federal highway funding by 5 percent if they do not comply. If we’re going to ask the states to take this on, then we need to ensure they have the capacity to do so.

Many groups like the Center for Auto Safety and the National Salvage Vehicle Reporting Program are working closely with the federal government to figure out how we can improve this recall process and thereby make the roads safer. Despite the great political pressure facing legislators to take bold action quickly, it would be much better to proceed judiciously, hash out the details, and avoid chaos later.