#rental car prices
HUGE increase in rental car rates, and nothing about in on Flyertalk.
Jul 2, 08 11:49 pm by randix
I rent cars 365 days a year. From ALL rental companies, including Thrifty. I’ve been doing this for years. So suddenly my $94/week rental in PDX I see is as high as $300+ if I was crazy enuf to book it for next week. I see rates also have been hiked in SEA.
So what gives? Don’t tell it’s the summer, it has NEVER been like this. Don’t tell me it’s the olympic trials in Eugene. the rates there are LOWER. High gas prices? Uh, how does that relationship work? I saw a news item that rental car companies are losing their. so they hike prices twice or three times higher? Nah.
Jul 3, 08 1:00 am by jackal
To be honest, $94 per week isn’t fair to the rental company. That translates to $376 per month.
That car is costing the rental company $450-600 per month to lease. If they own it outright (what’s called a risk car–they’re taking the risk of the depreciation hit), it’s costing them more than $376 per month in depreciation.
For their value, rental cars are insanely cheap compared to other rentals. I just checked, and here’s a guy renting a lawnmower in Gilroy, CA. The lawnmower probably retails for $400, give or take a bit. He rents it for $35 per day, $175 per week, and $289 per month.
Given the same cost-to-rental rate ratio, that means a $20,000 Dodge Caliber should rent for $1,750 per day, $8,750 per week, and $14,450 per month. So, it’s really the equipment rental places that are screwing you!
Rental agencies are tightening up their fleets so they don’t have as many cars sitting around. That’s why you used to get such cheap rates–the rental agencies figured that getting $94 per week for the car was better than having the car sit on the lot and earn $0. But with travel down and fleet costs skyrocketing (as the American car manufacturers tighten their cheap program cars), the rental agencies are reducing capacity to lower their overhead, which reduces supply and therefore increases price. And it’s not that the rental agencies are doing it to screw with the public: they’re really not doing very well–look at their stock prices. Last time I checked, all of the majors were down in the single digits (Dollar Thrifty was, at one point, over $40 per share).
That’s just my take. I could be off-base, though–I don’t have inside info into the overall country-wide financials.
Edit: there may be a reason you haven’t heard of it on FT. For one, those $94 per week rates are typically only available in low season in leisure markets (business markets typically have consistently higher weekly rates but fairly low weekend rates). You may have gotten them often, but for many other people, $200-300 per week was normal. Secondly, a lot of business travelers on FT have corporate accounts which have negotiated rates regardless of the time or location. Their corporate travel offices book their rental cars, and they don’t even really pay much attention to the rate (it always hovers somewhere between $30 and $50 per day, usually). Therefore, they are not seeing these giant price increases. Just a couple of thoughts. feel free to take them with a shaker of salt.
Jul 3, 08 2:34 am by randix