One of the most important functions the Legislature is to update laws that will ensure protection for all Californians. The time has come to do just that with the Car Buyers Bill of Rights. This legislation was passed into law in 2006 and has done important work in ensuring protections for consumers buying used cars, but not all used cars.
A major issue that is happening right now in the California used car market is open recalls. In fact, one consumer protection agency reports that in 2009, nearly 1.5 million used cars that had been recalled but not repaired were listed for sale. That constituted 3 percent of all used cars sold that year throughout the country.
This is why I support the Used Car Buyers Bill of Rights -- Assembly Bill 964. This legislation will improve protection to consumers by amending the Car Buyers Bill of Rights. In particular, the legislation will require that all open recalls be fixed before the vehicle may be purchased and will require disclosures on all used cars that have reported flood and fire damage and potential odometer fraud.
The 2006 law represented an important step forward. It gave consumers information and helped them make a more informed choice. But it doesn't give them enough information. This is especially true for low-income families who may only be able to afford a used car and shouldn't have to worry about getting stuck with a lemon.
The issue the Legislature needs to address is this: Currently, law does not allow car dealers to "certify" a used vehicle if they know it has certain damage, such as any previous flood or fire damage, frame damage or an odometer rollback. But current law does not require these same car dealers to inform consumers about a used car's history that is not certified, other than to give them the basic information provided by the National Motor Vehicle Title Information System.
That leads to some specific challenges for California consumers.
First, used car buyers could end up buying a lemon even though they think they have all the relevant information.
Second, an open recall can be a life-and-death challenge. According to a recent study, nearly 100,000 used cars with open recalls were for sale online in California last year. We need to stop this by empowering consumers with all the relevant information and require that the open recalls are fixed before the vehicle is placed for sale.
Finally, it's not just used car buyers who are at risk. We are all at risk when an unsafe car is on California highways. We all have an interest in seeing this law changed so that consumers make good choices and Californians are all driving safe cars.
This legislative session, the Legislature has the chance to change this law and save lives. By passing AB 964, we can ensure that all consumers have the information they need to make the right decision.
We can't allow this to continue and we need a change now before anyone else buys a bad car and before anyone else gets hurt.
Ruben Guerra, chairman and CEO President of Latin Business Association.