Auto Focus

What Price Safety?

August 20, 2009

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Enterprise Rent A Car bought thousands of 2006-08 Chevy Impalas and used a "fleet delete" option to remove side-impact airbags, a standard feature. The Kansas City Star broke the story this past Saturday.

The decision saved the company $175 on each airbag, or $11.5 million overall. To compound the matter, hundreds of those used rental units were sold saying they have the standard equipment, which includes the side-impact airbags.

I have been doing an informal survey of fleet buyers and sellers. The reaction has run the gamut from outrage to indifference, though all with a begrudging respect for the smartest buyers and sellers in the business.

First, the consensus is that Enterprise, as they have maintained, did not know that the cars were being sold out of fleet without disclosure that the side-impact airbags have been removed. Though it's no excuse, the error is easily believable, knowing how systems and procedures are set up with rigid protocols and how the information handoff between buyers and sellers in the same company is not always set up to catch every anomaly.

Second, some immediate reactions in Enterprise's defense:

● Enterprise is taking swift action on a make good. The company is informing the 745 people who bought those airbag-less units from its used car lots that Enterprise will buy back the cars at $750 above book value, regardless of condition.

● Enterprise is completely within the law. Side-impact airbags are not federally mandated. (Head-protecting restraints are required for 2010.)

● This was not a custom build for Enterprise. GM offered that "delete" option for all fleet customers. (They don't anymore.)

● "Fleet deletes" for items such as power equipment are common, especially in rental.

As one can imagine, this story isn't over. General Motors is in the process of contacting its dealers to track down the units Enterprise sold to them so that they can inform their customers.

For certified vehicle sales, used car sellers are protected to an extent by small print on the disclaimer that says "options listed may not represent actual installed features." 

But these comments and answers have only lead to more questions, about the disclosure process in general:

● Is that disclaimer enough of a legal liability protection for a seller should an injury and lawsuit follow? How widespread is that disclaimer, outside of certified, pre-owned inspections?

● If this was offered as a fleet-delete option to rental, commercial and government fleets, what about the supposed thousands of other units out there that do not have this standard equipment?

● What percentage of fleet units were ordered without side-impact airbags?

● At auctions, is there a standard procedure to identify to the buyer that certain standard equipment (especially, in this case, a safety item that cannot be seen) is definitively not in the vehicle, outside of a blanket disclaimer?

● Enterprise may be completely self-insured on this, but how would an insurance company view the decision to delete those airbags?

Fleet purchasers (regardless of buyer, either a rental car company or commercial fleet) have a responsibility to their companies to keep fleet costs as low as possible. With today's cost pressures, that task is monumental. We applaud those that do it well.

In terms of deleting safety equipment from a purchase, those buyers obviously made a risk assessment in the potential savings. But here is one last question for those fleets that chose to delete the side-impact airbags: do your drivers know you chose to buy the car without them? I can only hope so.

Comments

  1. 1. Chris Brown, editor [ August 21, 2009 @ 04:16PM ]

    Update: I've since learned that the seventh VIN number identifies existence of side airbags or not. I've also been told that, like the front airbags, an SRS logo would be stamped in the B pillar for cars with side-impact airbags. However, if you were assuming the car coming through the auction lane was a standard Impala, would you even think to look to see if it in fact had the logo on the B pillar? (And do you know how to read a VIN in that detail?)

    My question remains: when those cars with the deleted side airbags make it onto used car lots, how many consumers will actually be told, or figure out, that they're buying a car that doesn't have this very important piece of standard safety equipment on it?

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Author Bio

Chris Brown

Executive Editor

Chris Brown is the executive editor of Business Fleet Magazine and Auto Rental News for Bobit Business Media. Through these publications, online newsletters, trade events and associations, Chris covers all aspects of the fleet world, including fleet management, manufacturer fleet activities, the fleet leasing industry, vehicle remarketing, rental industry news, car rental taxation and legislation as well as automotive environmental initiatives and trends.

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