After 16 Years, Justice Department Ordered To Build Used Car Database
A federal judge ruled last week that the Department of Justice has until March to establish a used car database as directed by Congress 16 years ago. The National Motor Vehicle Title Information System will warn potential buyers if a used car was stolen or totaled, and will instantly verify the car's title and mileage. Here's how it will work...
By the end of March, all insurance companies, junkyards, and salvage operations will be required to tell the government when they write off vehicles damaged by floods, fires or crashes. Unlike the for-profit service CarFax, the system will capture information on all used cars.
The suit against the government was brought by Public Citizen, Consumers for Auto Reliability and Safety and Consumer Action, which argued that the Justice Department's failure to implement the 1992 law was endangering consumers. Justice countered that after 16 years, establishing the database was next on their to-do list.
The government did not dispute that it had failed to implement the law. But it argued it could be trusted to implement the National Motor Vehicle Title Information System without court-ordered deadlines.Judge Patel ruled from the bench and rejected the government’s request.
The ruling is a tremendous win for consumers, one that will eliminate much of the uncertainty associated with buying a used car.
Public Registry for Wrecks Is Back on Track [Wheels Blog]
Car safety database still MIA [ABC7]
Consumer Groups Win Suit Over Used Vehicle Database [Consumer Law & Policy Blog]
(Photo: extranoise)
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Comments:
This should help dealers avoid lemons as well. I'm pretty happy this is finally getting underway.
Bob, it shouldn't be all that expensive since it's just data retention. I would assume the small upkeep and gathering cost would be covered in vehicle taxes and registration.
Plus this will act as a deterent to vehicle theft if it's harder to move the vehicles. So this does benifit anyone who drives a car.
I believe the actual government response was "We said thanks but no thanks to the NMVTIS" and I'm shocked- shocked I tell you- that the bench chose not to accept this at face value.
I also think that the government is considering putting this database on computers, so they're waiting for a sale at Best Buy to buy one and evaluate the concept.
@PSN: kingpsyz: We're talking about the federal government here. Any group that can make a hammer cost $100 is the type of organization that I don't really trust to do something useful on the cheap...
But how much will it cost taxpayers who don't buy used cars?
Bob, thesmall cost of entering and maintaining a computer record will be more than offset. A buyer with higher confidence in the condition of your car will be willing to pay a little more. Free markets work best when maximum information is easily available. The price someone will be willing to pay for your car won't be discounted by their unease of its history and you'll likely get a few dollars more.
@PSN: kingpsyz: It shouldn't, but all the bureaucracy will make it cost billions. Do you know how many people we have to pay to manage that data plus how many people we need to pay to manage those people???
I'm surprised Carfax didn't file a lawsuit to protect the core of its business and tie this up in the courts for another 20 years.
@PSN: kingpsyz: Plus, think about server and bandwidth costs. Sure, it seems like a little bit of data, but we're talking EVERY used car. That data will need to be accessed by nodes across the country as well. Add on to what Ryan Duff and TheUncleBob have already mentioned and we're talking about a massively inefficient and overpriced system.
God I love the USA.
I can see two things getting worse:
* The costs to perform basic vehicle transactions (title fees, etc) will increase,
* The time and hassle to remedy any errors, such as the errors that keep you from selling your perfectly good car because someone fudged the VIN number when reporting someone else's totalled car. (I am aware VIN numbers have check digits, but that is not a cure all).
My vote is no, thanks. I deal with the RMV way too much already (i.e. once every 10 years).
@I_Elohel: I disagree with the negativity being tossed around about this.
This is something that indeed should be done. There is no denying that it will, as stated, help consumers in many, many ways. From deterring theft to helping consumers make sound financial decisions, this is a great idea all around.
Like you said, there are going to be those costs. But how else can it be done? Do you have any suggestions? How we can mass distribute important information and employ people to update and upkeep that information, all on the cheap?
I think we're all complaining way too much here. If anything, the biggest concern would be them actually doing it at all. They put if off for 16 years the first time, why not 16 more?
Down here in Texas, they just steal expensive imports and SUVs and strip them down for parts to sell on the gray market. We have even had a rash of tire + wheel thefts on larger SUVs in the last three months.
@tedyc03:
It looks like the Judges decision was handed down on the 22nd. Give Carfax a few more days I can guarantee they will file a lawsuit...
@ohenry: No, I agree with you. I was merely expanding on the negative aspect of the situation. I completely agree that this needs to be done, especially as one who ONLY buys used vehicles. I have been on the unfortunate end of a purchase where I bought a used vehicle from a private party and found out months down the road that it had some damage to the underside of the vehicle where it had looked like it had been wrecked and we were told that it hadn't been wrecked before.
@I_Elohel: Good call!
Yeah, I just think it'll be interesting to see if they really do go through with this. I hope that Consumerist can keep us updated on the progress of this if any is released.
@PSN: kingpsyz: they could also implement a nominal fee for companies to access individual records in the database. dealers, insurance cos., lenders & even companies like carfax would benefit immensely from the data.
this could also have the side effect of reducing depreciation of cars overall - i would imagine that book guides (which are largely used to determine FMV) would harvest the aggregate data to refine their vehicle values. strip out the junk vehicles & the average value of most models should increase.
I'm for this as long as there is no 'feature creep' that somehow causes this database to end up as part of a law enforcement program. It should be a pro-consumer tool, nothing more.
Of course, given the tendencies of government, that's probably a pipe dream. But I can hope.
@NightSteel: It's a Department of Justice program. It is certain that it will end up as part of a law enforcement program.
So how many Carfax employees are former Justice Department employees?
As far as stolen vehicles, they are already tracked in the NCIC database, but I'm not sure how accessible it is.
I disagree that this will capture info on all cars. It suffers from the same problem as Carfax - it's only going to include information if 1)the car had enough damage to be totaled, which is usually damage greater than around 70% of the car's value depending on the state and 2)if the damage went through insurance. If someone fixes the damage themselves, it won't be reported.
Both carfax and this new database will tell you bad shit happened to a car, but the absence of bad shit in either report does not mean that bad shit didn't happen to the car.
@AlexJP: Indeed, but not quite what I was getting at. As long as this is directed against fraudsters as Congress appears to have intended, great. Otherwise, no thanks.
Unfortunately this won't do much. People will just tip $20 to prevent the agent from reporting on the car.
Carfax has always been somewhat of a joke since it's design doesn't prevent people from simply not reporting things, and paying repair shops and salvage lots to not report it.
Nationalizing this doesn't really fix the problem.
If you want to crack down, you need to tightly regulate parts like prescription medication. Even then you'll still have people who buy parts illegally or import, but you'll have less than you have in the free market right now. When parts are purchased, that's when the record should be updated.
Of course that won't happen. It's not practical or worth while. That system would cost to much for the benefit it provides.
@TheUncleBob: A billion trillion dollars. I mean, I'm all for defending people who don't think they should have to pay for the 9th welfare baby even if I don't agree, but considering that lemons are a hazard on the road and a potential traffic hazard, I think it's warranted that this system be implemented. But next time you're stuck in traffic for an extra 45 minutes because someone's car died on them causing an accident, sit there and wonder if it was that car's time, or if a dealer pulled a fast one on the buyer.
In response to the ruling, the government said:
"We will comply with the ruling by paying a private company millons of dollars to do the job. We will then write a contract which gives us no control over the timetable of the project and in another 16 years declare the software doesn't work anyway. We really hope by this time that everyone uses anti-gravity devices or something."
So the Federal government will eventually have a huge, expensive database full of inaccurate data that they will not be able to keep current, which means it will be pretty much useless.
Their assumption is that salvage yards, auto auctions, dealers, rebuilders, insurance companies and private parties will all update the database. They've got to be smoking something to think that they will be able capture 100% of automotive transactions.
And yes, this will be a new tax on all of us - you really didn't expect dealers, automotive recyclers and insurance companies to eat the cost of this.
And with the Federal government, there will be function creep - the data will eventually be used by law enforcement.
CarFax going out of business in 3...2...1...
@TheUncleBob: Not nearly as much as the Iraq war costed those taxpayers who hadn't been abused by Saddam Hussein or killed by Iraq's nonexistent WMDs..oh wait...that's none of them!
@digitalgimpus: Done right, it could work without costing a horrible amount. For instance, code a program that licensed stores (both chains and individual store as well as salvage yards) would collect VIN information for each major part bought (a tail lamp, not recorded; a whole bumper, yeah). Salvage yards could even be required to make reports of what parts were pulled from what vehicle's VIN from their lots. There could be a daily/weekly/monthly/whatever data dump (most stores do this anyhow now-days for sales records and the like) to be collated in the government's servers for this thing.
Then again, all this makes some semblance of sense and contains logic. Those in government might not be able to understand a word of what I said anyway...
@digitalgimpus: Also, it would slow the repair process greatly. Requiring a VIN to buy parts means mechanics wouldn't be able to hold any stock. That would add 2-3 days to a repair.
@jonworld: I'm not sure what that really has to do with anything. Just because the government wastes money on one program, it should not give them a blank check to waste money on anything and everything else.
@Roclawzi: I'd rather blame the person who bought a used car without getting it properly checked out and didn't take proper care of it.
@Coles_Law: ehh... the regulation of car parts? No thanks... How much would that slow down the repair process, not to mention, couldn't I just get the VIN off of someone else's Dodge Intrepid and have the replacement part ordered with their VIN in the first place?
Don't worry about carfax. The government will just buy them out and fold them into this division of the DOJ. You have to just love this new GOP.
@NightSteel: Uhh... I don't mind if the cops have the ability to check your vehicle, in any number of ways, to see if it is registered as stolen. The more power they have in this regard the better.
Everything is a trade off. But the benefits will out weight the costs...
@tedyc03: You took the words right out of my mouth. I thought bribery and kickbacks greases the wheels of government.. something is obviously wrong here.
This is something the federal government can be useful for! No stupid interfering with our lives, but simply mandating that information is available!
Why can't we do this with simple stuff like non-narcotic prescription drugs? Or education? Or seatbelt laws? Here's the information. Use it or not.
Two comments...
I would love to have been a fly on the wall listening to a DOJ lawyer explain just how 16 years of inactivity is not an indicator that they weren't "just about to get it done!"... You gotta wonder how these lawyers can actually keep a straight face with some of the lines they get paid to deliver.
Second... I don't think CarFax will be going out of business, and obviously they can't be "bought out" by the DOJ... If they were smart, they would submit an unsolicited proposal that offers to incorporate the CarFax business model and database into this new requirement. Undoubtedly, CarFax can do it cheaper and more efficiently than the DOJ can from scratch. CarFax can tweak their entire business model to be funded by DOJ, probably triple their coverage of cars, increase their customer base by at least one order of magnitude, charge a quarter of what they charge now on a per-report basis (thus providing an illusion of savings to the government), and rake in a substantial fortune in the process!
It's about time. It'll be much more useful if it actually discloses the reason for salvaging too. Hail damage or theft recovery isn't as bad as a rollover, y'know.
The issue at stake is that some wrecks get sold off at auction without the title being pre-labeled as salvage until the vehicle is re-registered. This is provides an easy loophole in which the vehicles get registered in a different state which has more lenient standards.
Here in CA, to get a salvage car retitled, one only has to get it to pass the smog check, that the headlights are aimed and taillights are functional, and that the brakes can stop the car from 25mph. That's it. Nothing about how straight it is, if the other safety aspects are functional, etc.
@jjason82: I've never met anybody in my life that hasn't bought at least one used car.
Nice to meet you.
/bought my first car new
/10 years ago (still driving it)
next on my to-do list:
1) believe they weren't lying.
2) laugh my fucking head off
3) repeat
Yeah, CarFAX is *never* wrong. Ever.
@twophrasebark: another 16 years? we'll all be in flying cars by then. i was promised a flying car!
oh wait - reality check - by the time the database is up and running all gasoline fueled vehicles will be obsolete due to a lack of oil.
@AlexJP: Errors need to be corrected, even if they cause some inconvenience to you so that others can get a strait, safe car.
By March??? Sheesh, I work in state government and it takes 6 months to order a box of pencils, so good luck on that March thing. I would say a realistic timeline is more like 2-3 years.
This certainly does not bode well for CarFax, although I'm pretty sure they're probably eligible for a billion-dollar government bailout.
But how much will it cost taxpayers who don't buy used cars?