RD479 - Salvage Study - November 2014

  • Published: 2014
  • Author: Department of Motor Vehicles
  • Enabling Authority: Letter Requests from the Senate and House Committees on Transportation

Executive Summary:
On November 1, 2013, Chairman Stephen D. Newman, Senate Transportation Committee, requested DMV to establish a stakeholder group to “explore and study issues associated with salvage, non-repairable, and rebuilt vehicles”, with a specific focus on issues surrounding cosmetically damaged vehicles versus operationally damaged vehicles when determining whether a vehicle is non-repairable. He requested that the stakeholders include representatives from the salvage and insurance industries, law enforcement, the Virginia Automobile Dealers Association (VADA), the Virginia Independent Automobile Dealers Association (VIADA), the Commissioners of the Revenue Association of Virginia, and any other stakeholders identified by DMV that would be necessary to accomplish the work of the stakeholder group.

On February 11, 2014, Chairman Thomas D. Rust, House of Delegates Transportation Committee, requested that DMV include consideration of House Bill 441 in the scope of the stakeholder study. Delegate C. Fariss’ bill would have created a new policy of motor vehicle insurance and schedule of rates for salvage vehicles; Chairman Rust wished the study group to review and discuss the issues raised by the bill as part of the salvage study.

Both Chairman Newman and Chairman Rust requested that the results of the study and the work group’s recommendations be reported back to their respective committees in December, 2014.

In response to these requests, DMV assembled an internal team to organize and manage the study. Invitations to participate were extended to stakeholders: members of the insurance industry, automobile dealer associations, motor vehicle dealers, salvage dealers, rebuilders, salvage pool operators, salvage yard operators, scrap metal processors, Commissioners of the Revenue, and law enforcement. A series of meetings were held between April and September, 2014.

During the course of stakeholder meetings, in addition to what was outlined in the charge letters, the study expanded to include examination of the following concepts:

• The possibility of an enhanced inspection process to determine the roadworthiness of salvage vehicles.

• An examination of whether changes should be made to vehicle branding, the threshold for vehicles to be declared non-repairable, and the definition of late-model vehicle.

• A review of the end of life reporting process and the definition of when a vehicle is no longer a vehicle.

• Whether out-of-state buyers at salvage pools should be licensed or registered in Virginia.

The first stakeholder meeting was held on April 1, 2014, at which the study was organized into subject-specific working groups. Because of the interrelated nature of the topics, individual stakeholders served on multiple working groups.