Zipcar hit with feds’ first-ever fine for renting out recalled cars

If you rented a van from Zipcar a while back, there’s a chance it failed to meet the National Highway Traffic Safety Administration’s standards.

The NHTSA hit Zipcar with a first-of-its-kind fine for “renting vehicles with open, unrepaired recalls,” the agency announced on Monday. The federal safety agency regulates vehicle recalls in the U.S., and its scope expanded with the “Safe Rental Car Act” in 2016. NHTSA named one recall in particular in Zipcar investigation documents.

The recall concerns 2015-2017 Ford Transit vans. In as many as 373,000 Transits made during those years, the “coupling between the transmission and driveshaft” may “deteriorate and crack,” potentially causing power loss while driving. The issue may also cause “unintended vehicle movement in park,” the 2017 NHTSA report said. 

Zipcar said in an email to TechCrunch that “less than 50 vehicles out of its 12,000 global fleet were found in violation” of the NHTSA’s policies. The company added: “Since 2017, Zipcar has implemented new policies and process improvements to address recalled vehicles in its fleet.”

The NHTSA’s civil penalty totals $300,000. Zipcar must pay $150,000 upfront, but it can avoid paying the other half by meeting some NHTSA demands, including updating employee training materials, according to the agency’s order. 

While Zipcar received the first of such fines, it isn’t the only rental company named in an NHTSA investigation. In 2022, the NHTSA said it was also investigating Hertz.

In other recent regulatory moves, the Justice Department announced a lawsuit against eBay, claiming that it sold and distributed “hundreds of thousands” of products that pose environmental and public health risks.