NHTSA Requires Odometer Statements Up to 20 Years

NHTSA, the U.S. Department of Transportation’s National Highway Traffic Safety Administration, issued a reminder that starting January 1, 2021, every vehicle ownership transfer will require an odometer statement for the first 20 years.

Odometer disclosures will be required for every transfer of ownership for the first 20 years, beginning with Model Year 2011 vehicles. Model year 2010 and older vehicles will still be subject to the previous 10-year disclosure requirements, and are exempt from the new extended Federal odometer disclosure requirements.

Why the change in odometer readings? With the U.S. vehicle fleet aging, NHTSA finalized this Final Rule in September 2019 to combat what it saw as increasing odometer fraud, especially with older vehicles.

Odometer fraud is a Federal crime and NHTSA has for decades required sellers to disclose odometer readings at the time of sale. In most states, vehicle transfers were subject to a requirement that odometer disclosures be made in a paper format with handwritten names and wet-ink signatures. Establishing standards where states may allow for odometer disclosures electronically with increased security and authentication, it removed the paper requirement. This action also removed the last remaining Federal impediment to paperless motor vehicle transfers.

By removing the need for paper documents, this allowed state Departments of Motor Vehicles to move toward paperless transactions, a cost reduction and time saver for consumers and the industry, meant to create economic efficiencies and improve security.

“This Final Rule was written after considering comments received from the public, including state motor vehicle departments,” NHTSA Acting Administrator James Owens said. “As more records are kept digitally, this rule will allow electronic filing of odometer information. Electronic records are more efficient than paper documentation and are harder to forge, helping to prevent fraud.”

Prior to the ruling, the law didn’t require odometer disclosures for vehicle transfers at least 10 model years old. With the current average vehicle age of almost 12 years, a large proportion of cars in operation were subject to increased odometer fraud risks. The Final Rule will now require odometer statements until vehicles are 20 years old, beginning with the 2010 model year.

To comply with Federal law, anyone transferring ownership of a model-year 2011 or newer vehicle will be required to provide an odometer disclosure to the new owner, and sellers of model-year 2011 vehicles must continue until 2031.

[Images: NHTSA, © 2020 J. Sakurai/TTAC]