What’s in a Name?

What’s in a Name?

What’s in a Name?

AAMVA’s Salvage and junk Vehicles Best Practice aims to reduce variances in title branding across jurisdictions

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Karyn Wrye, Senior Director, Government Affairs at Manheim, and Co-Chair of the National Auto Auction Association

Every jurisdiction has its own way of branding vehicles, which can lead to confusion. Depending on the jurisdiction and the amount of damage to a vehicle, that vehicle could receive a junk or salvage brand, or even no brand at all.

For instance, in Iowa, a salvage vehicle is one that has repair costs exceeding 50% of the vehicle’s fair market value before it was damaged. In Louisiana, that percentage goes up to 75%. And in Utah, that number goes up to 100%. So, clearly, it varies widely.

It’s important for these regulations to be consistent for several reasons. First, a damaged vehicle’s ownership documents need to be appropriately noted, thereby providing valuable information to future owners.

Secondly, consistent regulations prevent fraud. For example, having consistent branding practices across jurisdictions could eliminate the fraudulent practice of using stolen parts to rebuild a salvage vehicle.

And lastly, consistent regulations need to be in place to protect consumers. If a vehicle is branded as “junk,” it should not be rebuilt, according to AAMVA. But not every jurisdiction follows that practice.

AAMVA encourages uniformity and consistency across jurisdictions because without it, there is an impediment on interstate commerce. Cars are being sold across state lines today more than they ever have before, so it’s critical that every jurisdiction is on the same page.

On that note, jurisdictions should honor a prior jurisdiction’s titling brand. If a vehicle was issued a flood brand in one jurisdiction and resold in another that does not have a flood brand, for instance, it’s entirely possible that the original brand could be lost or the vehicle could be rebranded entirely. We want everything to be consistent so that brands don’t get lost or changed. We want a complete history of jurisdiction branding information. Currently, we can see that kind of information on the National Motor Vehicle Title Information System (NMVTIS), but even there it’s confusing because of the nonuniformity across jurisdictions.

I think change is coming, but jurisdictions have to re-assess their processes and work to get it right, so it will likely take some time. Implementing the recommendations in the AAMVA Best Practices in their entirety will help jurisdictions uniformly brand vehicles, achieving a comprehensive vehicle history and, ultimately, improving consumer protection.


 

Allan Shinney, Director, Motor Vehicle Enforcement Division, Utah State Tax Commission

Here in Utah, branding a car as “junk” means that only its parts can be used or the vehicle will be destroyed. “Salvage,” on the other hand, means the vehicle sustained damage but it is safe to go back on the road if it is rebuilt properly. The terms often get lumped together, but they’re completely different.

That said, these terms mean different things in different jurisdictions. AAMVA is doing an excellent job trying to create standardization across all jurisdictions, but we have a long way to go.

In our region, we work well with all the surrounding jurisdictions, but even then, when vehicles come in from other regions overnight on transport, it can be difficult to keep up. It should be mandatory that all jurisdictions follow the same guidelines.

Because a vehicle is the second biggest asset most people will acquire—next to a house—we need to be able to guarantee the value of that vehicle. Otherwise, innocent people will get burned, and their vehicles could unknowingly pose a threat to the motoring public.

Jurisdictions should not be allowed to “debrand” or rebrand a vehicle. I fought for that here in Utah, and now that’s the rule. If a vehicle has a junk title when it comes into our state, it stays that way. It’s not my responsibility to clean the title and have someone else get burned. Putting that car back on the road would be helping the insurance companies make more money, and I don’t want any part of that. Hopefully other jurisdictions feel the same way.

Far too often, it’s all about making money. Dealers, of course, want to make money, but they know when they’re buying a junk car at an auction. And because of all the confusion and inconsistencies, insurance companies can continue to hike up prices. It’s a total nightmare.

Safety should be our top priority, not profits. AAMVA and its Salvage and Junk Vehicle Best Practice guide are truly the light at the end of the tunnel.


 

Tony Hall, Assistant Chief of Regional Services, Texas Department of Motor Vehicles, Vehicle Titles and Registration Division

There are 51 jurisdictions in the U.S., and every single one of them has a different way in which they establish what is junk and what is repairable. This causes countless inconsistencies.

These inconsistencies pose a major threat to consumer protection. Really, it all boils down to that. The vast majority of the motoring public doesn’t understand the ins and outs of vehicle safety, so they rely on the jurisdiction to brand these vehicles appropriately. Consumers need to have at least some awareness of what, if any, incidents happened to that vehicle.

Without uniform regulations in place, people can still sell unsafe vehicles. This could impact that vehicle’s operator, of course, but also all the vehicle operators around them.

Consumers should be able to rely on the jurisdiction to keep them safe, but even at the agency level, we can become confused by all the different requirements. When a car is considered “salvage” in one jurisdiction, why is it different in another? It just doesn’t make sense. Here in Texas, we at least honor a prior jurisdiction’s branding of a vehicle, even if our definitions aren’t an exact match. All other jurisdictions should do the same.

The terminology needs to be consistent as well. For instance, in Texas, we don’t call a vehicle “junk,” we call it “non-repairable.” And once a vehicle is repaired, we call it a “rebuilt salvage vehicle” while others might call it a “prior salvage” or just “rebuilt.” They all mean the same thing. When that’s confusing to us as motor vehicle professionals, you know it’s even more confusing to the general public. In turn, this can lead to problems with insurance companies. It just needs to be spelled out clearly in black and white.

Anytime you can create consistencies so everyone is communicating and on the same page, it makes everyone’s job easier in the long run. You don’t have to waste time asking what things mean. And I know I’d rather not waste time explaining things.

The AAMVA best practice guide lays out a number of good recommendations for how titling and branding should be handled, and what kind of inspections vehicles should go through so all repairs will be consistent across jurisdictions. If every jurisdiction fully adopted the entire document and implemented it, we could keep the motoring public safe, and people would be aware of what they’re buying and operating.


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