CarMax Accused of Selling Used Cars Recalled but Unfixed

Tuesday, July 01, 2014
(graphic: Steve Straehley, AllGov)

The nation’s largest seller of used automobiles has come under fire from numerous consumer groups and one U.S. Senator for selling damaged goods.


CarMax has sold vehicles subject to recalls by their manufacturer without getting them fixed. In its advertising, the company claims that every one of its cars and trucks undergoes a thorough safety check. But that process apparently does not include addressing autos under recall, which is why the Federal Trade Commission (FTC) has been asked to investigate.


“Car dealers shouldn’t sell used cars that have a safety recall to consumers, period,” Senator Charles Schumer (D-New York) said in a prepared statement. “Far too many times we have seen the tragic and often fatal consequences when deficient cars are allowed on the road, and it's time for the FTC to do everything it can to put a stop to it.”


One consumer advocate, Rosemary Shahan, president of Consumers for Auto Reliability and Safety, accused CarMax of “playing recalled-used-car roulette with its customers’ lives.”


Shahan’s group has been joined by 10 other groups, including Consumers Union, the Consumer Federation of America, the Center for Auto Safety, the National Consumer Law Center and the U.S. Public Interest Research Group in its campaign against CarMax.


The company is able to sell potentially faulty, even dangerous vehicles, because of a loophole in federal safety law. Car dealerships cannot sell new autos under recall, but they can sell used ones subject to recall. California lawmakers have tried to pass a bill that would put used cars on the same level as new ones when recalls are in play, but the bill died in a state Assembly committee.


It’s not even a matter of paying for the recall. Used car dealers like CarMax can take cars to that brand’s new car dealer for free repairs. However, CarMax attorneys say it’s “impractical” for the company to have to pay staff to shuttle the cars for repair. Instead, the company advises buyers to register their cars with the manufacturer so they can be advised of “future recalls,” according to the Los Angeles Times.


In the meantime, automobile recalls have become common. About one in five cars on American roads today have been called in by automakers to address mechanical or other problems, amounting to more than 50 million vehicles nationwide. This year has already gone down in the record books, with more than 31 million cars recalled so far, the highest ever for one 12-month period.

-Noel Brinkerhoff


To Learn More:

Petition Seeks To Block CarMax Sales of Unrepaired Recalled Cars (by Jerry Hirsch, Los Angeles Times)

11 Consumer Groups Ask F.T.C. to Investigate CarMax Over Unfixed Recalled Cars (by Christopher Jensen, New York Times)


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