Once FedEx vans reach the end of their parcel delivery life, they are resold and repurposed for various uses. Many of them are being converted into food trucks as their size and boxy shape make them perfect for mobile kitchens. However, FedEx is facing a lawsuit for selling such vans, alleging the largest speedometer rollback scam in history.
The lawsuit alleges that FedEx replaced the odometers on many of its vans with new ones that read zero miles, then used the vans a little longer, and then sold them at auction with 100,000 miles or less on the new odometer. Given the low mileage, business owners bought the vans at premium prices, believing they were still fairly fresh. However, their actual mileage was sometimes four times the mileage, leading to myriad mechanical problems that cost customers far more money. In some cases, the problems were so severe that vans became unusable and businesses went bust.
According to KTNV Las Vegas, Tom Layton of Henderson, Nevada, first noticed FedEx odometer residue back in 2017. Layton, who has been buying and selling trucks and vans for 36 years, bought a FedEx Freightliner truck with around 180,000 miles on it. When he sold the truck, his buyer hooked it up to a computer, which told him the actual mileage was about 400,000 miles. Layton then filed his own lawsuit, which is separate from the class action lawsuit FedEx is currently facing.
Since then, customers in California, Tennessee, New Jersey, Florida and Virginia have noticed the odometer reset on ex-FedEx vehicles.
Freightliner MT45 | via Getty Images
FedEx hasn’t always sold its retired vans. Once they got about 350,000 miles, they usually scrapped the vans. It wasn’t until 2011 that FedEx began auctioning old trucks through its fleet company, Holman Fleet Leasing (also a defendant in the lawsuit). The lawsuit alleges that both FedEx and Holman deliberately switched odometers to artificially inflate the value of the vans so that they would be sold at higher prices at various auctions across the United States. Then, according to the allegations, both companies would split the profits.
“FedEx has replaced thousands of odometers on FedEx/Holman vehicles with Holman’s knowledge and assistance,” the lawsuit reads. “Although odometers, as automotive components, occasionally wear out or malfunction and need to be replaced, there was no valid reason for this large-scale odometer replacement on FedEx/Holman vehicles other than to uphold their odometer fraud agreement.”
It’s not illegal to swap odometers, and it’s not even illegal to sell vehicles with odometers showing inaccurate mileage. However, to do so, the seller must issue a disclaimer advising the buyer that the odometer reading is inaccurate and that the odometer has been replaced. According to the lawsuit, neither FedEx nor Holman did so.
“Defendants knowingly failed or refused to include such a warning because they intended it to mislead potential buyers of the vehicles.”
However, FedEx denies the allegations. “We are aware of the allegations made in the complaint and will vigorously defend the lawsuit,” a FedEx representative told Spectrum News.
The Drive has contacted FedEx for comment and will update this statement when we receive one.
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