Gray Market Vehicle Program: Extension Warranted, but Improvements in Vehicle Identification Are Needed
RCED-94-22
Published: Jan 03, 1994. Publicly Released: Jan 03, 1994.
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Highlights
Pursuant to a legislative requirement, GAO reviewed the National Highway Traffic Safety Administration's (NHTSA) enforcement and administration of the gray market program, focusing on: (1) the extent to which the program ensures that permanent gray market vehicles are brought into full compliance with federal motor vehicle safety standards; (2) whether adequate controls exist for identifying and enforcing requirements for temporary gray market vehicles; and (3) whether safety considerations warrant continuation of the program.
Recommendations
Recommendations for Executive Action
| Agency Affected | Recommendation | Status |
|---|---|---|
| Department of Transportation | The Secretary of Transportation should evaluate the merits, including benefits, costs, and potential alternatives, of modifying the federal vehicle identification number (VIN) coding provisions to require a uniform VIN code to identify whether each vehicle was originally built to conform to U.S. safety standards. |
Closed – Not Implemented
DOT is currently studying the possibility of using two VIN to identify the country in which a vehicle was intended to be sold.
|
| Department of Transportation | The Secretary of Transportation should work with the study group mandated by the Anti-Car Theft Act of 1992 and the American Association of Motor Vehicle Administrations (AAMVA) to facilitate cooperation among state and federal agencies to better identify and control the registration of gray market vehicles. |
Closed – Implemented
DOT is working with AAMVA to identify policies and procedures used by the states to title and register gray market vehicles.
|
| Department of Transportation | The Secretary of Transportation should determine whether NHTSA should seek authority to require the exportation of noncomplying vehicles and whether the level of fines for such vehicles should be increased. |
Closed – Implemented
The agency has evaluated the existing penalties and believes they are adequate. After DOT has additional experience with this program, GAO may evaluate the extent to which DOT has effectively used these penalties.
|
| Department of Transportation | In addition to improvements in vehicle identification and federal-state cooperation, the Secretary of Transportation should take action to establish user fees sufficient to cover the registered importer program's cost. |
Closed – Implemented
DOT has revised its fee schedule and taken steps to reduce its costs. At this time, however, it is too early to determine whether fees assessed will cover program costs.
|
| Department of Transportation | In addition to improvements in vehicle identification and federal-state cooperation, the Secretary of Transportation should take action to ensure that all imported vehicles (U.S.-market, gray market, and Canadian) meet the same degree of compliance with safety standards and recalls for the correction of safety defects. |
Closed – Implemented
NHTSA has initiated several actions to ensure that owners of imported vehicles that have been subject to a recall are notified and that recall work is performed on imported gray market vehicles. NHTSA is enhancing its capability to cross-reference vehicles that have been involved in recalls. Registered importers (RIs), which are required to inform gray market import vehicle owners of recalls, are provided with the recall information. NHTSA has taken action to ensure that RIs have appropriate recall procedures in place. Further, NHTSA has implemented actions to ensure that before an RI releases a vehicle, all recall work will be evaluated.
|
| Department of Transportation | In addition to improvements in vehicle identification and federal-state cooperation, the Secretary of Transportation should take action to improve the accuracy of the federal database for tracking gray market vehicles. |
Closed – Implemented
NHTSA will be working with vehicle manufacturers, AAMVA, the Department of State, and the U.S. Customs Service to improve the accuracy of the database. This action will be conducted on a continuous basis.
|
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