Editor’s Note: The following article appearing in the January issue of RV Executive Today and authored by Jeff Kurowski examines heightened scrutiny on RV manufacturers, suppliers and dealers by the National Highway Traffic Safety Administration (NHTSA). Kurowski is director of industry relations for the Recreation Vehicle Dealers Association (RVDA).
The National Highway Traffic Safety Administration (NHTSA) has gotten more aggressive the past two years, so dealers, manufacturers and suppliers need to be more aware of the agency’s rules and requirements, according to a Washington, D.C.-based attorney who spoke during a seminar at the National RV Industry Trade Show in Louisville, Ky.
An obvious outcome of NHTSA’s aggressiveness is more safety-related vehicle recalls, including RV recalls, said Christopher H. Grigorian of Foley & Lardner LLP.
In the United States, manufacturers self-certify their vehicles and component parts. If they find a safety-related defect – or noncompliance with an applicable Federal Motor Vehicle Safety Standard (FMVSS) — they must notify NHTSA within five business days and notify vehicle owners within 60 days. The notification must be made even if the manufacturer or supplier doesn’t yet have a remedy developed or replacement parts available to fix the defect or noncompliance, Grigorian says.
Last summer, NHTSA fined high-volume RV manufacturer Forest River Inc. the maximum $35 million penalty for failing to notify the agency in a timely manner. Grigorian said it was the agency’s way of “sending a message” that the RV industry is under greater scrutiny.
RV dealers also have obligations under the laws that NHTSA enforces. Grigorian said it’s illegal for a dealer to sell or lease a new towable RV or motorhome that is subject to a safety recall unless the defect or noncompliance is remedied before the customer takes possession. “Dealers should have a process in place to flag VINs [vehicle identification numbers] of recalled vehicles to ensure they are repaired prior to delivery to purchasers,” he reported.
According to several dealers, Keystone RV Co.’s online warranty registration portal prevents dealers from registering the warranty covering a unit that’s subject to a recall for a defect that has not been remedied. However, other manufacturers’ dealer portals force dealers to look through long lists of models and VINs to determine if a unit in their new-unit inventory is subject to a recall.
NHTSA opened a web portal (www.nhtsa.gov) in August 2014 which allows dealers and consumers to search for recalls by VIN.
It is not illegal, under federal law, for a dealer to sell a pre-owned unit that’s subject to a recall. A dealer “makes a business decision, not necessarily a legal decision,” when deciding whether to accept in trade a towable or motorhome that’s under a recall, Grigorian says. However, selling such a unit may expose the dealer to product liability claims. Such sales might become illegal in the future, as proposed laws prohibiting sales of recalled — but not remedied — vehicles have been considered in California and Congress, he says.
“It might be best for a dealership, if it doesn’t handle a brand that’s subject to a recall, to check with a dealership that does handle it, to see if there’ll be a long wait for replacement parts” before accepting the trade, Grigorian says.
Dealers also need to be aware of the federal highway bill signed into law this past December, Grigorian says. The new law, known as the FAST Act, states that “fair reimbursement” by a manufacturer to a dealer for providing a free recall-related servicing, may be denied if the dealer doesn’t notify customers of open recalls when their vehicles are in for other repairs. It also makes it illegal for rental car companies and dealers operating rental fleets of 35 or more vehicles to rent, lease, or sell vehicles with an open recall.
Not all NHTSA recalled vehicles get repaired. The Center for Auto Safety estimates that only 70% of the cars equipped with recalled Takata air bags will ever be fixed.