Vehicle leasing is expected to return to the state of New York after president Bush signs the federal highway bill, according to the Greater New York Automobile Dealers Association (GNYADA).

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The bill includes a ban on vicarious liability – the antiquated law that holds a leasing company liable for a driver’s negligence which has forced 20 automakers and every major retail bank in New York out of leasing. The elimination of vicarious liability has long been an initiative of the GNYADA and is expected to bring automakers back into the leasing business in the state.


GNYADA president, Mark Schienberg, welcoming the federal government action, said: “This antiquated law has hurt the retail auto industry, and we are pleased that Congress has put an end to it.”


Vicarious liability is a legal concept that holds a leasing company liable for the actions of the driver of a leased vehicle. According to a GNYADA and Alliance of Automobile Manufacturers statement earlier this year, it has cost consumers in New York more than $US280 million in extra costs since 2003, and has reduced consumer choice.


The passage of the bill ends a long-running battle with trial lawyers who supported vicarious liability and brings New York in line with the 49 other states which have already eliminated it.

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“Leasing is an important alternative financing option for families looking for newer, safer vehicles and for small and large businesses looking to expand their fleets. It is an option that all consumers deserve, and we are pleased that New Yorkers will again have the ability to lease vehicles,” Schienberg added.