AMERICAN ASSOCIATION OF MOTOR VEHICLE ADMINISTRATORS
SELECTED RESPONSES TO REQUEST FOR COMMENTS
VEHICLE BUYBACKS - COMMENT FTC FILE NO. P96 4402
JUNE 21, 1996
The following are responses to questions that are related to the program responsibilities of the American Association of Motor Vehicle Administrators. The Association represents state and provincial officials in the United States and Canada who are responsible for the administration and enforcement of laws pertaining to the motor vehicle and its use. Our members are responsible for titling and registering vehicles of all types, including those that may become involved in manufacturer buybacks.
For further information, please contact Larry Greenberg at 703/522-4200.
5. How long should a vehicle be considered a "buyback"? Permanently? Until successfully repaired? Some other time period? How can it be determined whether a vehicle has been successfully repaired prior to reselling it?
The Final Report of the Motor Vehicle Titling, Registration, and Salvage Advisory Committee contained a number of recommendations designed to establish uniformity between the states in titling and reporting requirements. AAMVA jurisdictions have adopted the recommendations of the Final Report as policy.
One of the recommendations proposed establishing standard definitions and procedures (including branding) for salvage, rebuilt salvage, nonrepairable, and flood vehicles. "Buyback" vehicles are similar in that their safety and value may be affected.
AAMVA believes that title branding is the best means of conveying a vehicle's buyback status. Once a title has been branded, the brand should remain a permanent part of the vehicle's history, as recommended in the Final Report.
The Final Report also recommends that states perform a uniform safety inspection on rebuilt salvage vehicles, based on criteria established by the National Highway Traffic Safety Administration. Similar criteria could also be established for performing uniform safety inspections on repaired buyback vehicles.
7. What methods are or would be most effective in getting information about a vehicle's history and prior repairs to consumers before they buy the vehicle? Title branding? Disclosure documents to be given to consumers? Other methods? If disclosure laws are the most effective method, then what type of disclosure requirement should be imposed? What are the costs and/or benefits of these various methods?
As stated above, AAMVA believes that title branding is the best means of conveying a vehicle's buyback status. AAMVA is responsible for a project called the National Motor Vehicle Title Information System (NMVTIS) that will track the histories of all vehicles "from birth to death" (i.e. from manufacture through disposal), including any brands associated with the vehicle title. Potential purchasers can have ready access to history information via third party providers.
NMVTIS is being developed in cooperation with the Department of Transportation in accordance with Title II of the Anti Car Theft Act of 1992. A bill called the Anti Car Theft Improvements Act of 1996 (HR 2803) was introduced in the House of Representatives to amend Title II by authorizing grant funding and transferring responsibility for administering NMVTIS from the Department of Transportation to the Department of Justice. As of June 20, the bill was passed by both houses of Congress and is being forwarded for presidential signature.
In November 1995, Congress provided $890,000 to conduct a pilot project. States that have committed to participating in the project include Florida, Indiana, Massachusetts and Virginia. New York and Maryland are also interested in becoming pilot states. The pilot will be completed approximately April 1998.
We believe that NMVTIS could easily be modified to accommodate buyback vehicle brands within the vehicle history, and that any associated costs would be minimal.
9. If disclosure or title branding laws are or would be most effective, how should any such disclosure or title branding rules be enforced? By FTC regulation? By model State law? By a national databank of VIN numbers? By other means?
If the decision is made to place brands on the titles of buyback vehicles, procedures would need to be established to require manufacturers to report buyback transactions to motor vehicle agencies. The agencies would then make this information available via NMVTIS.
NMVTIS includes four central files, one of which is called the brand file. Vehicles are identified in the brand file by VIN.
10. Uniformity in the disclosure and labeling of repurchased vehicles might resolve the problem of interstate shipment of vehicles to avoid individual state requirements. What are the costs and/or benefits of diverse State requirements versus those of uniformity? Would a uniform national standard be an effective method to get buyback information to subsequent purchasers? What would be the costs and/or benefits of a national standard?
The National Motor Vehicle Information System will record vehicle histories for all motor vehicles, including any brands associated with the vehicle title. If buyback status is included as a brand, this information will also be captured by NMVTIS. The system will maintain the history regardless of the number of owners that acquire the vehicle or the number of states through which the title is transferred.
While uniform standards are desirable, they are difficult to accomplish. As an example, pages 31-34 of the enclosed AAMVA Vehicle Services Information Repository shows widely varying definitions given by states for the term "salvage vehicle."
NMVTIS would function effectively even if the states' definition of "buybacks" was not uniform. In such case, the system would forward the vehicle status, but state administrators would need to consult a separate reference to verify what is meant by the term "buyback" in the state that gave the vehicle this designation.