Thrifty - HUGE increase in rental car rates, and nothing about in on Flyertalk???

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.

So what's the explanation. Do a search for rates in PDX or SEA and you'll see what I mean. Haven't looked elsewhere. $94 vs. $300... something is going on, what???? by the way, I called the local thrifty office in PDX and the guy stuttered, said "I dunno...summer?"

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 (http://us.zilok.com/rental/16317-lawn-mower-21-/5685-gilroy) 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...

Nope, don't buy that. Every single rental company, not only Thrifty, has doubled or tripled their rates approximately 2 weeks ago in the Portland and Seattle markets. I can go to Salem or Eugene (Oregon) and still pick up a rental car at more than 1/2 the price than Portland or Seattle. The price change has been recent in the Portland market, and as I say, by every rental company. Was just curious WHY it suddenly happened in those particular markets. There is a reason out there, and was curious that it has not caught anyone else's attention. This is not "normal summer" activity.

And sorta off topic, no, I don't feel sorry for the car rental companies and could care less if what they choose to price their rentals is not "fair" to them--they did it to themselves. As an experienced renter, I can take care of myself. I have seen how they treat Q public. If their stock is in single digits, they deserve it. Their obscene rates they charge for "coverage", their willingness to accept the public's ignorance to take advantage of their own published discount rates, and how they treat the public, puts them on the bottom of my list. I abide by their own policies and I come out fine, but anyone not as knowledgeable, is at their mercy at the rental counter, and gawd forbid they have to negotiate over a claim.

Rates did NOT just double or triple in the pdx and sea markets because rental car companies suddenly discovered a reasonable economic model. I just found it odd that (1) it happened; (2) thrifty could not "explain" it themselves; and (3) no commentary on flyertalk. We're not talking a 10% increase, we're talking doubling or tripling of rates.

I guess it's a giant conspiracy, then. :rolleyes:

For the past year and a half I had been renting cars through various agencies, and have noticed a triple rate increase for the next few weeks.

Have been renting for $89 or $94 per 4 day week, the rates are now $300+.
I was surprised that I haven't seen anything posted on FlyerTalk about it also.

Thanks for the post. For a moment there, I thought I was the only one :confused:

For the past year and a half I had been renting cars through various agencies, and have noticed a triple rate increase for the next few weeks.

Have been renting for $89 or $94 per 4 day week, the rates are now $300+.
I was surprised that I haven't seen anything posted on FlyerTalk about it also.

Oh, it is ridiculous!!!! I sort of posted about it on the Budget forum.

I'm trying to get a mini van for a week at SFO in August. I struggled to find one for 400.00 a week (inc. taxes). Plenty of places wanted 700.00 a week. OUTRAGEOUS!!!

I tried PL "name your own price" and was rejected up to 35.00 a day.

So I booked through PL regular service and used a coupon and since I can cancel it, I'm going to try again 2 weeks before I go to get a cheaper price by using PL.

Since everyone wants sub-compact and compact, I figure I'd be o.k with a mini van. Hey, I'd even take an SUV as long as it fit 7 people.

Crazy...

What size car are you looking to rent?

Whew!.. I've been wondering why nobody has posted about this either. I spend a week in SFO every September and have always been able to get a standard/mid-size car for around $20 per day from Thrifty. This year most companies are quoting upwards of $70! I knew rates were up a notch due to fuel and loss of manufacturer discounts, but a 300% increase? :eek:

Nope, don't buy that.

Neither do I. I just checked a weekend rental for both SEA and IAD in late July and even in later August. Found much higher weekend rates being quoted on Orbitz than my last rental at either location.

Even FOX at SEA, which has charged me $15 or less a weekend day my last two rentals, is quoting in mid-$30s. Two weekends ago at IAD I got a Thrifty economy (which was automatically upgraded to next class due to unavailability) for $10 a weekend day. Now Thrifty there is showing $37 for a economy and $44 for a compact, almost two months out.

Well, since the higher car rates sure can't be be tied to the increasing price of oil, if anyone finds out the real reason, let us know please. Bad enough the rise in airfares, and the cost of gas for the rentral cars...but now this.

Must be a giant conspiracy in the sky--the car rental gods are randomly increasing rates at some (but not all) locations and at multiple companies for absolutely no reason.

Or how about thinking logically:

[shrinking availability] + [skyrocketing fleet costs] = [higher prices].

Then:

[higher prices at one agency] + [market consolidation (AlamoNationalEnterprise, DollarThrifty, AvisBudget, Hertz--really only four companies out there)] + [industry-wide low or negative profits] = [reduction of rate wars] = [prices going up across the board]

Why only some markets? How about the fact that rates are market-sensitive. Rates in SEA and PDX have almost absolutely nothing to do with rates in Salem or Eugene. They are different markets. They may also be owned by different franchisees (actually, SEA and PDX are likely all corporate and Salem and Eugene are probably franchises). Each location can do whatever it wants, so if nobody tests the price-increase waters (opposite of a rate war, I guess) in Eugene, then the rates in Eugene will stay low.

I tried to explain it. If someone can come up with something better, by all means, go for it (I'm not an economist). What makes you discount my answer? Or do you just want to complain and don't actually want your question answered? :rolleyes:

Also look at the airport fees. Have they passed any new ones. Everytime I turn around it seems a city has passed a new tax.

I tried to explain it. What makes you discount my answer? Or do you just want to complain and don't actually want your question answered? :rolleyes:

Ease up abit partner.

Unlike higher airline fares and their associated new surcharges, new fees, and the downward spiral for long established in-flight amenities and service, all being tied to increased fuel costs, there has been a sudden and as yet unexplained significant increase in car rental rates noted, at multiple locations. I myself mentioned two locations at which I presented valid "before and after" rate comparisons. In my initial post, I failed to mention the $120+ per weekend day rate for a compact I saw, for every company listed on Orbitz, for last weekend in July. A daily rate this exorbitant is inexcusible, no matter the reason.

Guess what we are hoping for is for more fact, vice supposition, being offered by someone working in the industry, so our "complaints" can be put to rest.

In my initial post, I failed to mention the $120+ per weekend day rate for a compact I saw, for every company listed on Orbitz, for last weekend in July.

Sorry, should have said this very high weekend rate was viewed on Orbitz for LGA, as was thinking of making a two night mileage run to there. But with cars this expensive, and Priceline hotels at LGA also pretty steep, forget about that run.

LAS is the same as it was last week with one exception - Avis bumped their rates up which they do every summer.

lets be fair guys. I am an industy insider (former) from the avis brand. The truth is that the car manufacturers have been raising their rates since 2005. There are tons of articles about it all over the internet, go search for them.

I have said all over flyertalk that at straight bare cost, its around 14-15 dollars a day to own and operate a single vehicle whether it rents or not. This includes manpower, insurance, lease, etc etc. 15 per day *7 days= 105 dollars per day. That was based on the traidtional model of car turnback/lease programs.

In the past 2 years, manufacturers have changed that model. Avis alone had to absorb additional costs in excess of 50-100 dollars a month per car in the summer of 2006 alone. We had a huge meeting discussing it. Companies like ford and Chevy who traditionally gave cars away suddenly had less inventory due to closures, better practices (union renegotiations) which no longer guaranteed factories be open year round. There was a glut of SUV's on the market even back then and the only cars the rental companies could get cheaply were SUV's.

Pay attention now...

Starting this year with the gas prices climbing, the manufacturers knew they would be hurting, so on their more efficient models, they further diluted the availability by keeping more of them for sales to people who want to move to smaller cars. This left a much more expensive fleet for the Car rental companies to absorb. So either they get SUV's for cheap, practically given to them, or they buy/lease mid and compact size rentals at rates that push the average cost of renting a car up to 20 per day, or 150 per week(ish). That alone is a 1/3 increase in costs which rental companies try like hell to pass onto the renters, but competitive pricing models and the lack of travel usually makes it hard until demand (summertime peak) arrives.

Now REALLY pay attention now.

Rental car companies do not have fixed costs on these cars. The most glaring cost is the mileage overage. Depending on the model, the mfg has several different plans they can purchase for their buyback program.

For most mid size cars, 12-24k miles and 6-24 months on a sliding scale determines the buyback price. The buyback program is a program where the car rental companies buy cars with contracts that state the mfg will "buy back"the car so long as the rental company returns the car within certain parameters. (if you want to learn more about this, check out the avis forum and search for ezmonee, circa 1-2 years ago).

If the rental car company doesnt want to limit itself to these parameters, they buy the car straight up, which means they must sell it on its own, which in the tight car sales market currently isnt nearly as good as one would think. The sales of cars right now (new and used) is down across the country double digits.

To tie it all together....

1> Car fleet price has gone up
2> mfg's are releasing less cars to buyback programs
3> smaller fleets mean rental companies need to buy cars to supplement the buyback programs.
4> greater demand for more fuel efficient models means those models get more miles in less time, meaning that to get the most money from them, the rental companies need to turn the back faster and carry a greater fleet.
5> Obtaining a greater fleet in spite of 1,2,3 means what little buyback cars out there are bieng sold at greater prices, self fulfilling prophecy...


timing- most rental companies get cars around the first of the year in order to return them after the summer swell.... because of number 4, those cars arent making it through the summer, so right during the peak, the fleets are losing cars or making decisions to keep cars and risk them bouncing from the buyback program.

6> because of the risks, and the peak of use which ALWAYS happens around the 4th (july 1-mid august is the busiest part of the summer renting season), prices which naturally spike around that time are spiking in higher quantities.

7> even if a particular rental company is in good shape for cars, every rental company gears its prices off the two industry leaders (price leaders), avis and hertz. weekly they look at the prices of those two and then they adjust their own price model based off of what they are doing.


I hope this helps.

LAS is the same as it was last week with one exception - Avis bumped their rates up which they do every summer.

Like $60 a day for a compact during the week? I had trouble with my coffee when that quote came up recently . . . I guess I might do hotel shuttles if it comes to that.

Like $60 a day for a compact during the week? I had trouble with my coffee when that quote came up recently . . . I guess I might do hotel shuttles if it comes to that.

and thats the only way the prices will come down. they charge that much because they can. during peak times, cars are in demand.

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.

So what's the explanation. Do a search for rates in PDX or SEA and you'll see what I mean. Haven't looked elsewhere. $94 vs. $300... something is going on, what???? by the way, I called the local thrifty office in PDX and the guy stuttered, said "I dunno...summer?"



in regards to rates in seattle/pdx eugene, depending on when/where your rental dates straddle, your rates will fluctuate because in anticipation of a huge rental influx many companies probably transferred cars to locations closer to the Olympic trials. once the cars were rented, and slowly returned, prices drop and soon one way rentals from eugene to sea/pdx will be much cheaper as they start transferring cars back.

meanwhile, with the thinned out fleet in those two airports due to transfers, prices naturally "yielded up" according to straight macroeconomics. as demand increases and supplies dwindle, prices escalate.

the same thing happened in San Jose. due to a huge .com conference in San Jose, Avis had to transfer in almost 3,000 cars from as far away as LAX and Reno. During the week, demand thinned and prices dropped in San Jose. While the complete lack of cars made it more expensive in SFO/RNO/LAX

Granted, this is probably a small part of the mix, but if your reserving with 1 week notice in peak demand times, usually your price isnt nearly as good as it should be.

Thanks for the post, but I still am muddled. 3 1/2 weeks ago Thrifty rented me a compact car at $94/week at PDX. That same vehicle is now $288-$300+ per week at PDX. So what do I do? This Sunday I'm renting a car from Budget under their 10,000 mile Delta promotion for a 1 day rental, driving it to the Eugene airport on Sunday (where the Olympic trials are), and picking up a weekly rental at $136/week from Thrifty. Sure, that makes total economic sense to me.


in regards to rates in seattle/pdx eugene, depending on when/where your rental dates straddle, your rates will fluctuate because in anticipation of a huge rental influx many companies probably transferred cars to locations closer to the Olympic trials. once the cars were rented, and slowly returned, prices drop and soon one way rentals from eugene to sea/pdx will be much cheaper as they start transferring cars back.

meanwhile, with the thinned out fleet in those two airports due to transfers, prices naturally "yielded up" according to straight macroeconomics. as demand increases and supplies dwindle, prices escalate.

the same thing happened in San Jose. due to a huge .com conference in San Jose, Avis had to transfer in almost 3,000 cars from as far away as LAX and Reno. During the week, demand thinned and prices dropped in San Jose. While the complete lack of cars made it more expensive in SFO/RNO/LAX

Granted, this is probably a small part of the mix, but if your reserving with 1 week notice in peak demand times, usually your price isnt nearly as good as it should be.

I hope this helps.

Thanks for the detailed explanation. Still wondering about the $125+ a weekend day I saw quoted for a compact by every company listed at LGA, late July, and the economy Thrifty rate that jumped 350% from what I snagged only three weeks ago in IAD. Just summer peaks?

Thanks for the post, but I still am muddled. 3 1/2 weeks ago Thrifty rented me a compact car at $94/week at PDX. That same vehicle is now $288-$300+ per week at PDX. So what do I do? This Sunday I'm renting a car from Budget under their 10,000 mile Delta promotion for a 1 day rental, driving it to the Eugene airport on Sunday (where the Olympic trials are), and picking up a weekly rental at $136/week from Thrifty. Sure, that makes total economic sense to me.

And for now, that makes total sense on what to do. its obvious that someone/everyone over/underestimated something and now they are stuck in a situation where either they have NO cars to rent at all, meaning they have yielded up prices so that the only people booking will handle the no show factor, or they got totally screwed and only have super big cars (SUV/expensive rentals) so they figure book the mid size and "free upgrade" them to the higher classes to sneak em out. common practice.

I think your plan of driving to eugene is a winner, right now at least based on the plans. Check back daily, most car rental companies can change the price daily if they wanted to. I know at avis I changed the prices when I knew some flights were cancelled so that we would capture "one day quickie" rentals instead of sitting on a ton of cars. There were times where I was letting DTS cadi's fly out the door at 25 bucks per day for those who were ticketed on cancelled flights (since they were likely to not extend the rental).

Thanks for the detailed explanation. Still wondering about the $125+ a weekend day I saw quoted for a compact by every company listed at LGA, late July, and the economy Thrifty rate that jumped 350% from what I snagged only three weeks ago in IAD. Just summer peaks?

let me give you an idea. At my location (which i still hold close to the vest) dec 1-15 we were renting cars at weekly rates for 105 per week. Dec 16-31, we were renting compact cars for 105 per day.

thats HOW FAST a peak season and swing and how much. In all honesty 350% isnt hard to achieve in a summer peak season, depending on how tight the travel season is.

June 1-30 at my location we were renting mids for about 250 a week. 4th of july weekend, we were renting compacts for 415.99 per week (when including 4th holiday). The rest of the summer (ending labor day) the rates hovered between 300-400 a week depending on the local events.

LGA and NY in general is a weekend renters paradise. Locals rent the cars to get out of town on the weekends. weekdays the cars generally sit there. So a one day weekend day rental going for that price isnt surprising at all. Last time in NY I rented a car on a saturday during football season and it averaged about 95 per day. when i priced it out individually (single day rentals, it worked out to 130 per day sat and sun, 65 for the monday.

Thanks for the post, but I still am muddled. 3 1/2 weeks ago Thrifty rented me a compact car at $94/week at PDX. That same vehicle is now $288-$300+ per week at PDX. So what do I do? This Sunday I'm renting a car from Budget under their 10,000 mile Delta promotion for a 1 day rental, driving it to the Eugene airport on Sunday (where the Olympic trials are), and picking up a weekly rental at $136/week from Thrifty. Sure, that makes total economic sense to me.

Pick-up: SEATTLE PIER 48, WA, USA
Date: Jul 12, 2008 12:00 PM
Drop-off: Same as pickup
Date: Jul 19, 2008 12:00 PM
Car Type Compact
Car Type & Rate > Change
Car Class: Dodge Caliber or similar
Rate: $179.99/week
Total Base Rate (USD): 179.99
Options > Change
Book It
Rental Time Charge 179.99
Rental Tax (9.7%) 17.80
Sales Tax (9%) 18.12
Vehicle License Recoupment Fee ($0.50 per day) 3.50
Total Estimated Mandatory Charges (USD) 219.41
Estimated Grand Total (USD) 219.41


if you can take advantage of it...found via kayak

thats HOW FAST a peak season and swing and how much. In all honesty 350% isnt hard to achieve in a summer peak season, depending on how tight the travel season is.
...and then there's ANC, where the summer tourist season passenger numbers swing about 1,000% (or more) for the three-month season...and rates swing about the same! :D

This is all very interesting. I work for a car rental comparison site in the UK and have blogged about this very point recently - here's my take on it!

http://go.carrentals.co.uk/blog

And it is going up here too....

Gareth

LGA and NY in general is a weekend renters paradise. Locals rent the cars to get out of town on the weekends. weekdays the cars generally sit there. So a one day weekend day rental going for that price isnt surprising at all. Last time in NY I rented a car on a saturday during football season and it averaged about 95 per day. when i priced it out individually (single day rentals, it worked out to 130 per day sat and sun, 65 for the monday.

We are going to NYC for a cruise, etc in October. I saw that Hertz had a "shuttle" rate from Manhattan to airports picking up the car from 2PM Sun to noon Monday. Rental has be 24 hrs or less. Normal rates are around $100+ for a day. My rate for Full size car was 26.99 base and less than $30 all in. We are taking a side trip to Long Island to see some sights. It would usually cost more just taking transportation from Manhattan to JFK.

I have noticed that rates have gone way up for the summer. They may drop in the Fall/Winter here in So Cal.

I've been looking at rentals in LA for a week, sometime in the next week or two, and instead of seeing my typical $100-$150/week rental at Enterprise or Avis. I'm getting rates of ~$350 at Enterprise, and ~$550+ at Avis.

At one point the Avis website was giving me a ~$100 rate but it wouldn't let me book it.

I then tried to look for rates months in advance and it's still giving me rates 2-5x the old normal rates.. Really crazy! :(

Re: OP. There was some limited discussion. I started this one (http://www.flyertalk.com/forum/showthread.php?t=840923) in TravelBuzz:

And this thread (http://www.flyertalk.com/forum/showthread.php?t=842892) obliquely references about some countermeasures, at least for National.

Have had ridiculously high quotes for weekend days so far in MSP, HNL and PDX (the last one over that 7/4 weekend). Priceline and Hotwire couldn't ride to the rescue, but it's reported that some "goofy-coding" sometimes works (see the sticky in the National forum). OTOH, MCO still had very low rates, so it's not everywhere.

My first thought is that supply is being artificially limited and there's not enough competition at the affected airports. Something seems to have happened. A new oligopoly?

The way things SHOULD work, dagnabit, is that car makers own the car-rent companies and use them to dump slow-selling models and at least keep the factories going. I remember in the 1991-92 recession renting Chevy Corsicas at $39 or so all-in (with Entertainment coupon) on a 3-day weekend.

Looks like it might become necessary to check for hostile car-rent situations before booking airline tickets for leisure trips. :rolleyes: $60/day on weekends won't work with leisure travelers, especially in a recession.

Have had ridiculously high quotes for weekend days so far in MSP, HNL and PDX (the last one over that 7/4 weekend). Priceline and Hotwire couldn't ride to the rescue, but it's reported that some "goofy-coding" sometimes works (see the sticky in the National forum).
The way things SHOULD work, dagnabit, is that car makers own the car-rent companies and use them to dump slow-selling models and at least keep the factories going. I remember in the 1991-92 recession renting Chevy Corsicas at $39 or so all-in (with Entertainment coupon) on a 3-day weekend.



I actually visited HNL recently. I rented from thrifty May may 11-25 for a wedding and my brothers graduation at UH, grad party, and my birthday all of which fell in that two week period.

I paid 103 per week for a full size car (after AMEX 10% discount), which was courtesy upgraded to a 300 touring edition. A really nice, less than 1000 mile red one. With fees it came out to 240-250 ish for TWO WEEKS. I even bought the full tank of gas because the rate they were offering was 15 cents per gallon cheaper than the local costco.

After memorial day, the prices jumped to around 260 per week for the same reservation and gradually went higher, peaking over the 4th weekend and it hasnt fallen since.

Like $60 a day for a compact during the week? I had trouble with my coffee when that quote came up recently . . . I guess I might do hotel shuttles if it comes to that.

Then I try a last-minute booking and get a car for next week in LAS at $9.51 a day . . .

Then I try a last-minute booking and get a car for next week in LAS at $9.51 a day . . .

At LAS, it is purely revenue management kicking in. The rate is average for rentals 30+ days out. 2 weeks out, the price drops or increases based on availability (lately it has been dropping). 1 week out, bargain basement kicks in unless bookings are very strong. It is consistent curve which works out well for the agencies since few people reprice their reservations as their pickup date approaches.

High prices are not here to stay - revenue management is here to stay.

High prices are not here to stay - revenue management is here to stay.

I know all about revenue management - quotes for cars are higher for Monday only than they are from Monday through Wednesday.

Any advice for renting a car one-way from Seattle to San Francisco?:p

Any advice for renting a car one-way from Seattle to San Francisco?:p

If you were repositioning a car out of Florida, Hertz would almost always have a phenomenal deal. I can't find anything under $350 for you, though.

It's in Sacramento too. Weekly rates have suddenly skyrocketed, almost doubled, from all companies. It's not supply and demand. No special events in town and the rental lots are glutted with available cars.

It's in Sacramento too. Weekly rates have suddenly skyrocketed, almost doubled, from all companies. It's not supply and demand. No special events in town and the rental lots are glutted with available cars.

it may not be sacramento's special event. Within NoCal they routinely truck cars to other events. Cars in SAC could easily end up at LAX, San Jose, Reno, SNA, Oakland, or SFO. The yield model would routinely raise prices to slow reservations in other areas to build up inventory, for which would be transferred to other locations.

During the Avis San jose Strike over 4th of july weekend 2005, we received 10 trucks of cars from reno, several from Sac, LAX. Most of the cars that I cleaned as a manager were from Reno.

Oh no! We're being screwed, too, by Segway rental companies.

A $5,350 Segway I2 (http://segwaybythebay.com/index.php?p=view_category&category_id=2) rents anywhere from $150/day (http://www.segwaypb.com/pacific-beach-segway-rentals.htm) to $350/day (http://www.segway-rentals-now.com/Content/rates.asp)! And we're complaining about $45/day rentals?

Look, folks, I like to rent cars cheaply, too. I cringe at the $750 bill I got for a six-day rental I did from Salt Lake to Denver in May. Granted, $75 of that was for a prepaid tank of gas and a good bit was the $25/day underage driver fee, but it's still a tidy sum.

But the attitude around here seems to be that the rental companies are screwing us and are involved in some giant conspiracy to swindle the traveling public out of their hard-earned dollars and fatten their profits up, when realistically, the rental companies are just trying to stay in business and are responding to market conditions.

Listen to ezmonee--he knows what he's talking about. It seems ludicrous that there are a bunch of posts claiming that "this isn't supply and demand--it's something else," but no one has been able to even put forth a theory about what that something else is--and then when some industry insiders post some thoughts and theories, they're basically ignored (the posts in this thread pretty much haven't even acknowledged any of the points I or ezmonee have made).

Normally, I'm a friendly, easygoing FTer and like to meet everyone and keep everyone happy (I don't think I've ever made a single sarcastic or negative remark in the AS or AGR fora, which I frequent the most), but it's sort of irritating that the only response to my point of view was, "Nope, don't buy that." Everyone after that just kept right on with the line that "rates are skyrocketing and this is horrible and it's not fair and no one has told us why and oh by the way it's not just market forces it must be some giant conspiracy."

Even ezmonee's expertise was basically ignored. Folks, LISTEN TO HIM! He's telling you the honest truth about what's going on!

It seems silly that everyone's in such an uproar that rental car rates are rising and is ignoring attempts to explain how costs are rising, but although people are annoyed that airline fares are rising, they understand it's a perfectly rational and understandable response to fuel costs rising. Well, fuel costs to the airline industry are analagous to fleet costs to the rental industry. Maybe you'll all get it when one or two of the major rental companies declare bankruptcy like some of the airlines have.

If you think rental rates of $200 to $300 per week are unfair and you feel like you're being scalped, well, then go start your own rental car company. It's not easy to be profitable when, for example, a small location's (with a fleet of around 1,000 cars) car payment is around $650,000 per month, maybe more. Crunching some rough numbers, I'd say that, given the average length of rental and number of rentals such a location would do per day, you'd need to rent cars at LEAST at $35 per day. When you factor in weekly rates and cheap weekend deals and the spread in rates you can get from the various car classes and all of those things, you have to offset those below-$35/day-averages with above-$35/day rentals. And that's just to cover the car payment. There's another $30,000 per month (or more) for staffing costs. We haven't even touched all of the other expenses (computer systems, data lines, airport leasing costs, facility and parking area mortgages, etc.).

I don't mean to be critical of other FTers. I don't intend this as a personal attack and don't have any one person in mind but rather am just trying to illustrate the absurdity in the overall attitudes I see in this thread. I'm not blindly trying to defend the industry, either--I understand that there are some unethical RAC operators out there and do not support their fraudulent tactics. But I feel insulted when someone throws out a broad accusation that all RAC operators are greedy and unethical or that locations of a particular company should be avoided because of a bad experience one person had at one location (and honestly, having worked in customer service for five long years, it is my impression that most (but, yes, not all) "bad experiences" are brought on by the customer's own stupidity). I feel the same way about this thread--like all rental agencies are being accused of bad business practices. That offends me. Some of us are trying to run an honest business, but if we don't respond to the market in this way, we might be gone by the next season.

But the attitude around here seems to be that the rental companies are screwing us and are involved in some giant conspiracy to swindle the traveling public out of their hard-earned dollars and fatten their profits up, when realistically, the rental companies are just trying to stay in business and are responding to market conditions.

I think people here understand that car rental companies' costs are increasing and that rental rates must go up. What some of us are reacting to is that rates have suddenly jumped on the order of 70 or 80%, at least in some markets, rather than the 10 or 15 or even 20% we might have expected.

I've never had to pay more than $200/week for a compact in Sacramento, and usually less than $175. It might be $139 or $149 in a slow week and $189 or $199 when demand is high. It's been that way for years. Different companies have the best price different weeks but someone was always under $200, and usually several companies were. Now suddenly the cheapest compact is over $300.

There's no special event in town. Fewer people are flying into Sacramento than a year ago. When I rented on Saturday none of the rental companies had lines (the six biggest operate in a shared facility) and there were hundreds of available cars on the lots. So "supply and demand" by itself doesn't explain it for me.

You and ezmonee have done a good job describing the substantial costs the rental companies have to bear. But those costs have always been there. I think most renters understand that rental companies' costs are increasing and they expect and accept reasonable rate hikes. The question is why have the rates suddenly gone up so MUCH, at least in select markets?

I think people here understand that car rental companies' costs are increasing and that rental rates must go up. What some of us are reacting to is that rates have suddenly jumped on the order of 70 or 80%, at least in some markets, rather than the 10 or 15 or even 20% we might have expected.

I've never had to pay more than $200/week for a compact in Sacramento, and usually less than $175. It might be $139 or $149 in a slow week and $189 or $199 when demand is high. It's been that way for years. Different companies have the best price different weeks but someone was always under $200, and usually several companies were. Now suddenly the cheapest compact is over $300.

There's no special event in town. Fewer people are flying into Sacramento than a year ago. When I rented on Saturday none of the rental companies had lines (the six biggest operate in a shared facility) and there were hundreds of available cars on the lots. So "supply and demand" by itself doesn't explain it for me.

You and ezmonee have done a good job describing the substantial costs the rental companies have to bear. But those costs have always been there. I think most renters understand that rental companies' costs are increasing and they expect and accept reasonable rate hikes. The question is why have the rates suddenly gone up so MUCH, at least in select markets?

Colfax... you stated it perfectly. When a rate of $94/week goes to over $300 overnight, someone telling me that it's just the company responding to supply and demand or that the company "is entitled to a reasonable business model" makes zero sense. And at the PDX airport, pick any floor of any of the rental companies, and there are lines and lines of cars sitting there UNrented. Although I appreciate the couple of posters trying to "explain", I do not "buy" an overnight increase of those proportions, and as Colfax accurately stated, there is no big event happening, and anyone glancing at the full garage full of rental cars, knows they are not flying out the door.

This is an interesting thread. I have a couple of questions for the "conspiracy" folks:

1. Why would you expect a 10-20% rate hike versus any other amount? What is that based on?

2. If there truly so many cars just sitting on rental car lots, then wouldn't it make sense that the revenue management system of those companies would lower the rates at the last minute to sell it, like some have noted?

It makes good business sense to charge the highest prices people are willing to pay. Sometimes that means renting less vehicles at higher margins. And like some FTers have said, if the prices are truly higher than the consumers will pay, either a new company will come in and undercut the majors or the majors will see such a large decline in business that they will re-adjust their pricing. No?

I'm not trying to be rudely argumentative, just a little conversational. :)

I dunno. Starbucks charges $1.55 for a tall. Imagine if you showed up tomorrow and it was $4.75? That's what prompted this thread. Yes, you'd think that if they just had rental cars sitting on the lot, they'd lower the rates at the last minute to move them off. Guess what, they use to do that (in PDX as an example), but now the rates remain the same regardless of when you re-check. You can walk the floors of the rental complex for the major rental cars in pdx, and see the cars lined up that are sitting there. Don't get it. You can go off site to Thrifty and also see cars, and their rates are no different. Still waiting for a plausible explanation, and no, don't do the conspiracy thing. Just the facts. Nothing wrong (cough) with $300/wk for an economy car...except it happened overnight and bears no relationship with past rental history during this time of year and is across the board with all companies. Now where's my medication...

This is an interesting thread. I have a couple of questions for the "conspiracy" folks:

1. Why would you expect a 10-20% rate hike versus any other amount? What is that based on?

2. If there truly so many cars just sitting on rental car lots, then wouldn't it make sense that the revenue management system of those companies would lower the rates at the last minute to sell it, like some have noted?

It makes good business sense to charge the highest prices people are willing to pay. Sometimes that means renting less vehicles at higher margins. And like some FTers have said, if the prices are truly higher than the consumers will pay, either a new company will come in and undercut the majors or the majors will see such a large decline in business that they will re-adjust their pricing. No?

I'm not trying to be rudely argumentative, just a little conversational. :)

It is entirely possible that the Thrifty yield management department has decided to pursue a new strategy of holding the rates high and letting cars sit instead of lowering rates to raise the number of bookings. Maybe they want to test the waters and see if it results in higher profits.

I haven't heard anything official or in writing, but then again, I'm not privy to those details.

If this is a new directive from upper management, would that count as a conspiracy? :D I mentioned conspiracy because several of the original posts in this thread mentioned that it is happening all over and at multiple companies, and if people are demanding the answer to that, then the only possible answer I could think of is that it's a conspiracy among the RAC boards of directors or something. If it's just Thrifty at PDX or a few Thriftys, then I wouldn't say it's a conspiracy but rather just a simple policy decision or test.

Thrifty PDX was until recently a franchise. It was (within the last 2-3 years) bought by DTG corporate and is now a corporate store, so their rates and policies are managed by the corporate guys in Tulsa. So I'm not sure how localized this type of thing is.

My personal thoughts IF this turns out to be the case: I'm not sure it's a corporate directive. DTG president Gary Paxton specifically said once at a shareholder meeting that Dollar and Thrifty target the value market. They don't have the "full-service"* and business traveler/corporate account features and status programs that some of the "premium" brands (mostly Avis, National, and Hertz) have, instead targeting the leisure traveler (who is price sensitive). Paxton's rationale for this is that leisure travelers, on average, rent the cars for longer periods of time (5-7 days or more instead of 2-4 days). This helps keep staffing costs down, since the ratio of rental transactions to revenue rental days is lower--in other words, to achieve X revenue or X percentage of utilization, it can be done with fewer transactions, which allows a reduction in counter staffing, vehicle detailing staffing, lot attendant staffing, etc.

However, because DTG targets the leisure market, if they don't price lower than their competitors, they don't receive bookings. People aren't loyal to Dollar or Thrifty like they are to Hertz--I've only had a fairly small number of people tell me that they "only rent from Thrifty" (and even fewer that "only rent from Dollar"). I hear many more people tell me they "always rent from Hertz/National/Avis." The brand loyalty is less, so DTG relies on pricing.

So, I think this higher rate strategy is going to backfire on them. They'll be sitting on a bunch of cars and making $45 per day on 50% of them instead of $30/day on 90% of them. The math comes out better on the latter--unless they downsize their fleet so that 50% turns into 90% utilization. (That is happening at some locations.)

*I'm not entirely sure what, to the average leisure traveler, the "premium" brands offer over Dollar and Thrifty. The cars are typically just as new (in my experience) and rental policies are typically about the same. About the only difference I've really seen in the eyes of the general public is that, on average, the "premium" ones are more tolerant of damage to the vehicles and are less likely to pursue collecting on damage (which, if the company has to eat the cost of damage, is really bad business--losing money over damages could be enough to be the difference between a profit and a loss), but especially when you're dealing with franchises, the attitudes and policies vary more between the franchises and locations than the brands.

This is an interesting thread. I have a couple of questions for the "conspiracy" folks:

1. Why would you expect a 10-20% rate hike versus any other amount? What is that based on?

10-20% wasn't based on number crunching, it's more just a feeling. Like everything is going up 10%...more that 10% if gas/oil is involved...so car rentals should go up 10% too, as part of general inflation.

It's easy to understand how the rising cost of fuel makes a plane ticket double in price. It's not as self evident how the energy crisis doubles the cost of renting a compact car, esepcially when the renter pays 100% of the fuel cost, in addition to the higher rental rate.

But I understand it's not as simple as that....as ezmonee explained there are other factors involved besides the retail cost of a compact car...higher fleet costs, lower resale values, and others...these "behind the scenes" costs affect the bottom line in ways that aren't obvious to a casual renter like me. Those factors would push rental costs up higher than the general rate of inflation. It just doesn't seem to me that altogether those factors should cause rental rates to double. But that's a feeling, not based on number crunching.

If it's true this is only happening in select markets...then I'd go with the theory that the companies are testing a new pricing model, and don't know themselves yet whether it will help or hurt. OR they're looking for a quick cash infusion to compensate for large losses from being stuck with too many rapidly depreciating large cars and SUVs. And once those large cars and excess cars are removed from inventory, which takes time, prices will return to "normal".

Just speculating.

Btw, here's what I did in Sacramento....I needed a compact for five days, pickup Saturday, return Thursday. Best price at the airport was $310/week, or $62/day average. I rented Sat and Sun from Dollar at their weekend rate of $26.55/day.

For the other three weekdays all six companies were over $80/day for a compact. Enterprise was $82 at the airport but $44 for the same car Downtown. I returned the Dollar car Monday morning, took a bus Downtown for $1.50, and rented from Enterprise there, three days for $132. Total cost before taxes $185 vs $310 for a five-day rental at the airport.

back in 1970 in denver, it was about 25-30 dollars a day, plus 20 cents a mile, to rent a car.

through most of 2006,2007 the average cost to rent a car was 25-30 dollars a day, unlimited mileage.

c'mon guys. you act like a price increase wasn't coming....

seriously, as long as you are WILLING to pay the 300 a week rates, theres zero chance of it going down. if 20% of the traveling market decided it was cheaper to taxi-it, the prices would drop like a lead balloon even if meant operating in the red.

there IS NO new pricing model bieng tested. The truth is they have less cars to work with and what cars they do have have been procured at a greater cost, regardless of any observations on the number of cars on the lots.

Guys, when I worked in San Jose, there were at least 5 lots where I stored cars, only one of which (other than the main rental lot) was visible to the end user in any fashion. In those 4 lots not seen by customers eyes, I was able to store 3,000 cars. Or 0 cars. But typically on any given weekend (remember, avis was a weekday juggernaut, weekend leisure rentals wasnt avis' thing) there were 1,000 cars on the lots. I am willing to bet that nowadays those car counts are in the sub-150 car range and what cars they do have on lot are SUV's and minivans.

When I worked in Hawaii no matter which lot on any island there was storage lots for thousands of cars for the off season, but even so with the notable exception of specific high demand weekends there was still 300-400 cars sitting on the lots in reserve. Because of this thread I drove by the local storage lot and saw zero, none, nada cars in there.

Its important to iknow that Hawaii's tourism is DOWN right now, so for those lots to be empty means either they had less cars to begin with, or because demand was down they "turned back' a ton of cars in an attempt to save money. Either would have the effect in a pure yield based system of driving up prices.

Yield pricing goal is for the last car on the lot to be available for 1 million dollars a day. Every car reserved decreases supply, increases demand (for those of who have taken economics), and every time the supply decreases, and the price increses, the more people who rent as the supply decreases, the equilibrium point shifts.

Before my company or any of my employees pay $300/wk for an economy or compact car, I will buy used cars, park them in the cities in which we do business, and gladly pay the storage cost to make them available. No one gonna tell me that $300/wk rentals are flying off the shelf. R U serious?


It is entirely possible that the Thrifty yield management department has decided to pursue a new strategy of holding the rates high and letting cars sit instead of lowering rates to raise the number of bookings. Maybe they want to test the waters and see if it results in higher profits.

I haven't heard anything official or in writing, but then again, I'm not privy to those details.

If this is a new directive from upper management, would that count as a conspiracy? :D I mentioned conspiracy because several of the original posts in this thread mentioned that it is happening all over and at multiple companies, and if people are demanding the answer to that, then the only possible answer I could think of is that it's a conspiracy among the RAC boards of directors or something. If it's just Thrifty at PDX or a few Thriftys, then I wouldn't say it's a conspiracy but rather just a simple policy decision or test.

Thrifty PDX was until recently a franchise. It was (within the last 2-3 years) bought by DTG corporate and is now a corporate store, so their rates and policies are managed by the corporate guys in Tulsa. So I'm not sure how localized this type of thing is.

My personal thoughts IF this turns out to be the case: I'm not sure it's a corporate directive. DTG president Gary Paxton specifically said once at a shareholder meeting that Dollar and Thrifty target the value market. They don't have the "full-service"* and business traveler/corporate account features and status programs that some of the "premium" brands (mostly Avis, National, and Hertz) have, instead targeting the leisure traveler (who is price sensitive). Paxton's rationale for this is that leisure travelers, on average, rent the cars for longer periods of time (5-7 days or more instead of 2-4 days). This helps keep staffing costs down, since the ratio of rental transactions to revenue rental days is lower--in other words, to achieve X revenue or X percentage of utilization, it can be done with fewer transactions, which allows a reduction in counter staffing, vehicle detailing staffing, lot attendant staffing, etc.

However, because DTG targets the leisure market, if they don't price lower than their competitors, they don't receive bookings. People aren't loyal to Dollar or Thrifty like they are to Hertz--I've only had a fairly small number of people tell me that they "only rent from Thrifty" (and even fewer that "only rent from Dollar"). I hear many more people tell me they "always rent from Hertz/National/Avis." The brand loyalty is less, so DTG relies on pricing.

So, I think this higher rate strategy is going to backfire on them. They'll be sitting on a bunch of cars and making $45 per day on 50% of them instead of $30/day on 90% of them. The math comes out better on the latter--unless they downsize their fleet so that 50% turns into 90% utilization. (That is happening at some locations.)

*I'm not entirely sure what, to the average leisure traveler, the "premium" brands offer over Dollar and Thrifty. The cars are typically just as new (in my experience) and rental policies are typically about the same. About the only difference I've really seen in the eyes of the general public is that, on average, the "premium" ones are more tolerant of damage to the vehicles and are less likely to pursue collecting on damage (which, if the company has to eat the cost of damage, is really bad business--losing money over damages could be enough to be the difference between a profit and a loss), but especially when you're dealing with franchises, the attitudes and policies vary more between the franchises and locations than the brands.

I think I understand where everyone is coming from a little better now. It will definitely be interesting to see if this is a general trend or some limited-time fluctuation.

Before my company or any of my employees pay $300/wk for an economy or compact car, I will buy used cars, park them in the cities in which we do business, and gladly pay the storage cost to make them available. No one gonna tell me that $300/wk rentals are flying off the shelf. R U serious?

People pay $600 to $1,000+ per week in the summer in ANC, and they do that gladly. I haven't seen cars go out for under $75/day since early June. Of course, we are a VERY seasonal market (I'd estimate 75% of our year's visitors arrive between June and August), which increases demand and therefore rental (and hotel) rates.

Welp, Thrifty just sent a new record for PDX. To rent an economy car 8/10 to 8/17 they are offering it for $389.27. If you hit their "hot deal, you get a compact for $334.00. Think I'll pass, although I would appreciate a photo of anyone signing a rental agreement on that $389.27 rate. Oh, I know, they are purposely raising rates 300% so their Chapter 11 filing will be more effective!


People pay $600 to $1,000+ per week in the summer in ANC, and they do that gladly. I haven't seen cars go out for under $75/day since early June. Of course, we are a VERY seasonal market (I'd estimate 75% of our year's visitors arrive between June and August), which increases demand and therefore rental (and hotel) rates.

I have a picture of a customer signing a contract for a subcompact for one week at 629 per week. The reason why I took the pic was because All I had left on the lot at the time was a DTS and a Hummer and because his rate was close enough, he could have either as gratis upgrades.

the look on his face was priceless when they handed him the hummer keys.


Welp, Thrifty just sent a new record for PDX. To rent an economy car 8/10 to 8/17 they are offering it for $389.27. If you hit their "hot deal, you get a compact for $334.00. Think I'll pass, although I would appreciate a photo of anyone signing a rental agreement on that $389.27 rate. Oh, I know, they are purposely raising rates 300% so their Chapter 11 filing will be more effective!

I have a picture of a customer signing a contract for a subcompact for one week at 629 per week.

How could you justify (to the customer) taking the picture? You can't really say "this is the most abusive rental contract I've ever written" . . .

I don't want to "me too" but it's a slightly different perspective. We travel a lot and we can usually find the deals, either discount codes or PL/HW. HOwever, we are flying into MCI in two weeks and best we could find was $170 Thrifty, $250 avis, and since thrifty charges for a second driver the savings wasn't significant enough for me to go to thrifty.

$250? for MCI? I know the taxes there are a little crazy (also the case with Seattle, FWIW) But for the longest time i wasn't able to find anything to help us. A little creative research did, eventually.

We also made a reservation months ago for IAH for a three-day weekend this coming weekend for $86, which seemed a little pricey compared to what we could get. i'm now THRILLED we thought that far ahead. everyone is coming in at double that now.

i too wondered if this was a phenomenon. my dissonance is because there didn't seem to be a gradual price increase. it went from 'reasonable' to 'what is going on??.', imho. not being in the industry, my thought process was, "less people are flying, and less people are renting cars for the heck of it, so you'd think they'd want to keep the prices low to keep people renting cars." of course again i know nothing about the industry.

thanks for the insight.

Does this sounds like a strategy tried by some hotels -- instead of discounting rates to bring in lower-margin revenue, go for high rates that result in higher-margin revenue (even if the total revenue is lower somewhat)?

For rentals at airports, the car rental companies can probably get away with such a strategy a bit more than elsewhere. As those still traveling the most by air this year and renting cars at airports have greater disposable income (than the average customer last year), they can afford to spend more on average for car rentals too and so the car rentals are trying to squeeze as much out of whatever customer they get still at these locations.

I doubt it's a strategy. If it is, every single rental company happened on the the "same strategy". And then I'd be accused of suggesting a conspiracy!!



Does this sounds like a strategy tried by some hotels -- instead of discounting rates to bring in lower-margin revenue, go for high rates that result in higher-margin revenue (even if the total revenue is lower somewhat)?

For rentals at airports, the car rental companies can probably get away with such a strategy a bit more than elsewhere. As those still traveling the most by air this year and renting cars at airports have greater disposable income (than the average customer last year), they can afford to spend more on average for car rentals too and so the car rentals are trying to squeeze as much out of whatever customer they get still at these locations.

I don't want to "me too" but it's a slightly different perspective. We travel a lot and we can usually find the deals, either discount codes or PL/HW. HOwever, we are flying into MCI in two weeks and best we could find was $170 Thrifty, $250 avis, and since thrifty charges for a second driver the savings wasn't significant enough for me to go to thrifty.


Without knowing length of visit or car class, we can't tell if this is a decent deal at MCI or not - if it's a week, I would probably not balk at all; if it's two day's and a compact there's a problem.

I doubt it's a strategy. If it is, every single rental company happened on the the "same strategy". And then I'd be accused of suggesting a conspiracy!!

Many travel suppliers are lemmings, where one does and then others follow.

Plenty of people make plenty of money on packaging and re-packaging many of the same concepts (whether from within the same segment of an industry or from other segments and other industries), often in quite short order, to several companies in the same industry at nearly the same time. I'm not suggesting that this is what necessarily has happened here, but enough car rental suppliers seem to have done much as the others have done before that this wouldn't require much more than even "monkey sees monkey does"

How could you justify (to the customer) taking the picture? You can't really say "this is the most abusive rental contract I've ever written" . . .

actually, I said to him.

"sir, this is a horrible price are you sure you want to do it? if it were me I would rather take a cab."

he said

"I need the car, a cab would be 3x this. I have no choice for what I am doing. In fact I really need a minivan, but the only thing that was available was the subcompact. my fault for booking three days ago."

I snapped the picture and told him "well...todays your lucky day..."

Rented this weekend at Budget at EWR (Thrifty next to them, no change in price between the two). Chevy cobalt rental - $85 a day w/o insurance, addons, etc...! SUV not discounted.

Suspect that car residual values are crashing and the rental cars are jacking up rates to cover them. Fleet cars may not be disposable of in the current economic environment, particularly if things get worse - there will certainly be a glut of used automobiles.

Was very suprised. Cabs becoming a reasonable alternative at that rate.

While I have some cheap leisure rentals coming up this month in other parts of the country that are well below $15 per day, SMF is an interesting scenario.

For 'peak' rentals, typically, I would see daily rates of $50-$60 per day, and I could bid $25 or so and get it on PL. Now, I am seeing daily rates as $70-$90 per day, and bids below $50 are getting rejected. So, something has changed dramatically in the past few months.

On the lot, I didn't see a lot of cars, but didn't see many renters either. All of the scenarios of transfering cars, much more turnbacks, less program cars, etc. etc. can all be true, but from a renter point of view, I guess it is just hard to swallow no matter how needed it is for the rental companies to survive.

Rasheed

FWIW LAS weekend rates at Avis just crashed, but are not quite as low as they were earlier this summer. Hertz is up slighlty based on increased demand, and Dollar, Thrifty, Alamo and Advantage are at the lower ends of their normal pricing.

Hertz at LAS is back down again through at least September 30.

Does this conversation belong buried in the Thrifty forum or there a better home for it?

Rented this weekend at Budget at EWR (Thrifty next to them, no change in price between the two). Chevy cobalt rental - $85 a day w/o insurance, addons, etc...! SUV not discounted.

Suspect that car residual values are crashing and the rental cars are jacking up rates to cover them. Fleet cars may not be disposable of in the current economic environment, particularly if things get worse - there will certainly be a glut of used automobiles.

Was very suprised. Cabs becoming a reasonable alternative at that rate.

made one phone call to a friend still in the business, I asked him about the prices and he confirmed two things from his vantage point.

1> Because of the looming gas price crisis, smaller cars are renting extremely fast. As a result, they have had to raise prices equal to that of an SUV, so that now in some airports when you rent a specific class car, they give you the SUV as a free upgrade just to get it off the lot. And even then, people are refusing them.

2> starting January, the cost of obtaining long terms (12-18 month) turnback program cars in the fleets was rising fast and nonexistent in some cases. Chevy Cobalts were coming in at 5-7 grand LESS at turnback, zero price break on purchase, and extremely strict terms for accepting cars through the turnback program (meaning rental car companies are going to be EXTREMELY strict on damage to vehicles, so make sure you have your policies up to date).

he said an internal memo went out to all managers explaining the skyrocketing costs and that the company (avis and budget) have chosen to not secure as many cars nationwide. This crush was felt most noticeably at the beginning of summer (post memorial day).

this mirrors what I have been saying about this incident. Its not a price conspiracy, but it is due to pressures of the market.

A friend of mine has taken to renting cars from dealerships. Some used car dealerships will rent cars, esp since they arent really selling right now. If you travel to a specific city often, you may be able to work something out with a particular dealership. But one word of warning, Amex defines a car rental company as a company that predominately obtains its revenue from renting of cars. So you will need to make sure your own personal rental insurance is up to date.

Another thing my friend did was cab to a u haul. rent a truck and returned it same day, it was cheaper (even with the miles charge).

creativity works.

Well, it looks like the sudden hike is over. Small cars in the PDX market that were going for $384/week, as of 8/24 (and no earlier) are now going for $83/week.

Another thing my friend did was cab to a u haul. rent a truck and returned it same day, it was cheaper (even with the miles charge).

creativity works.

LOL... I've thought about that before. Especially, because in most major cities UHaul also rents vans.

Effective 8/31, offered a rate of $77/week for a compact car in PDX... let's see now, a month ago they wanted $384+ for that same car. Sorta makes me feel warm and fuzzy for those nice folks at Thrifty, always thinking of their customer...

I am in the car rental business and I must say most of our customers are a bunch of whiners. We are in the business to make money. I agree prices are much higher than they use to be. I have the reason. You ready? here it is: "Rental car companies raised their prices because they CAN!!!" Get over it!! Stop .....ing and moaning. If you don't like it, drive your own car!!! Go ahead and reply with a smurky response. I know that there are nothing but snot nose yuppies on here!!!!!!!!!

Sincerely,

Ih8complainers :cool:

I am in the car rental business and I must say most of our customers are a bunch of whiners. We are in the business to make money. I agree prices are much higher than they use to be. I have the reason. You ready? here it is: "Rental car companies raised their prices because they CAN!!!" Get over it!! Stop .....ing and moaning. If you don't like it, drive your own car!!! Go ahead and reply with a smurky response. I know that there are nothing but snot nose yuppies on here!!!!!!!!!

Sincerely,

Ih8complainers :cool:

Hi Ih8complainers and welcome to FT!

While I'm pretty much 100% with you (although I think it's more than "just because they can"--just like although it can be argued that airlines are raising fares just because they can, the root is oil prices: with car rentals, the equivalent to oil prices is fleet prices), I'm not sure I'd use so much of an adversarial attitude. Others around here might view it as trolling.

I will say this on this subject: just like airlines are folding, if fleet prices don't come down and/or rates don't stick at a moderately high level (not gouging, but an average of $35 per day is probably fair), you might see some rental car franchises fold. Probably not entire corporate systems, but some individual franchises. Chrysler is ending their "second cycle" leasing program, and I know some franchises who are looking at TREMENDOUSLY increased fleet costs or having to buy the cars outright--something that takes a LOT of capital, resulting in much smaller fleet sizes (if the franchises don't have that kind of capital). Some agencies are really getting pretty shaken. I predict it's the beginning of the end for some of them.

Go ahead and reply with a smurky response. I know that there are nothing but snot nose yuppies on here!!!!!!!!!

Sincerely,

Ih8complainers :cool:

And, apparently there are some jerkoff industry employees too...

:rolleyes:

I am in the car rental business and I must say most of our customers are a bunch of whiners. We are in the business to make money. I agree prices are much higher than they use to be. I have the reason. You ready? here it is: "Rental car companies raised their prices because they CAN!!!" Get over it!! Stop .....ing and moaning. If you don't like it, drive your own car!!! Go ahead and reply with a smurky response. I know that there are nothing but snot nose yuppies on here!!!!!!!!!

Sincerely,

Ih8complainers :cool:

One wonders why someone would claim to work for Hertz and come on here with that username and also with the comments you have posted.

I feel sorry for your staff and customers that deal with you, if you do indeed work for Hertz. I do agree with your basic sentiments but not calling "most of our customers are a bunch of whiners" Have you stopped to wonder why you have made that claim ? Perhaps they are sick of dealing with your staff and older cars etc etc ;)

Be aware that you have made it VERY public that you work for Hertz and I am sure many Managers have read your posts.

If you do work for Hertz its time you got out of the customer service business!

Effective 8/31, offered a rate of $77/week for a compact car in PDX... let's see now, a month ago they wanted $384+ for that same car. Sorta makes me feel warm and fuzzy for those nice folks at Thrifty, always thinking of their customer...

Weekly compact rates have crashed in Sacramento too, not as low as $77, but less than half the $300+ everyone wanted for a compact in July and August. Budget, Dollar, Thrifty, Alamo, National, and Enterprise are all coming in between $100-$125/week for a compact in the random September and October weeks I've checked.

I was never convinced that July and August's $300+ rates in Sacramento were a function of higher demand. Not when airport arrivals and hotel occupancy were down. My take on this is that the $300+ rates were a pricing experiment and that the companies decided it wasn't paying off. Current rates are still higher than they were a year ago, but more in line with general inflation, not 100-150% higher.

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Fwiw, I am paying very low rates these days for my rentals. I think the spike is over. Pricing is back to reflecting weak demand.

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Nov rates are extremelu low in las. $10-$12 or so per day.some agencies hit $8 per day.

I got an $83/wk rate in PDX last week, other cities no more than $130/wk it seems. Unfortunately have a need to be in SJC over the coming months, and Thrifty does not seem to be as competitive there as in other markets so looking at other vendors (if anyone has any suggestions, feel free to PM me. Neverthless, far cry from the craziness of the rates this summer that I saw, as I walked through the lots and saw aisles and aisles of available cars going unrented.


Wirelessly posted (FlyerTalk.com/wap is fun : BlackBerry8830/4.2.2 Profile/MIDP-2.0 Configuration/CLDC-1.1 VendorID/105)

Nov rates are extremelu low in las. $10-$12 or so per day.some agencies hit $8 per day.

I am in the car rental business and I must say most of our customers are a bunch of whiners. We are in the business to make money. I agree prices are much higher than they use to be. I have the reason. You ready? here it is: "Rental car companies raised their prices because they CAN!!!" Get over it!! Stop .....ing and moaning. If you don't like it, drive your own car!!! Go ahead and reply with a smurky response. I know that there are nothing but snot nose yuppies on here!!!!!!!!!

Sincerely,

Ih8complainers :cool:

For someone that hates 'complainers', you sure seem to do it a lot. Just 7 weeks ago you offered up a apology for calling bhatnasx a "dumba$$" with this caveat:

"I apologize for coming off as a jerk. Just a way to vent about the customers that seem to break spirits in the rental world." from http://flyertalk.com/forum/showthread.php?p=10295024&highlight=#post10295024 posts #26 and #30

Maybe your "spirits" should be broken before the bottom of the bottle points up towards the sky- especially when driving the company's car.

Cheapest rates (with AX10 coupon) I have ever seen:
Wed October 29-Friday October 31 @ $7.60 per day. Available at both Thrifty & Dollar.

at airports....they're claiming it's the smaller fleets and the hard time the companies are having selling their used cars as well but it's highway robbery
in this supposedly 'deflationary spiral' period and I don't think they will be able to sustain this gouging for long

I just found this thread, but, same here:

http://www.flyertalk.com/forum/national/990095-first-post-question.html

:(

Seems like the taxes/fees used to be 50% of the base rate in Seattle. I was looking to book a reservation in November and the taxes/fees are now 70%. Did something change?

Sorry to post without an introduction. I'll go do that now.

Posting to add email notification to thread.

I'm still finding ridiculous rates ($100+) for one day rentals, and others much higher than usual...While I did get a $35 Thrifty rental at MCI earlier this month, that was very unusual this year. Typically, if I must have a car on a trip, I have wound up going with Avis with a corporate rate of about $52-64 a day; otherwise trying to get a decent rate through Priceline, which has worked a few times.

ie - $100+ per day for SFO or SMF in early November $35 for Las Vegas per day for a subcompact in late September...(I recently got a $22 rate for the Vegas trip through Priceline as prices have NOT dropped..or only a few dollars at most)

Same $100+ per day for BWI, EWR, BOS, PVD, etc. in October...

So for those who thought $300 a week was too high a year ago....how about $100 per day?

As I mentioned in another thread under Thrifty, I refuse to pay those kind of rates and in several instances this summer have just skipped the rental and gone with airport shuttles...

As someone who rents cars from various cities and various agencies 365 days a year, I could tell you a lot of stories. As I vaguely recall, I believe I started this thread way back when I was younger. Yes, rental prices are ridiculous, they got hiked up some time ago and have never come down (and if a certain person wants to show up here and defend the rental companies that they are adhering to their cost model, been there, done that). Rates have NOT been responsive to demand, they have held up the rates. Certain non-corporate locations have yelled foul with no success, and they have gotten around corporate in certain ways I won't mention here. Perhaps the model has been broken, cause in many cases the charges simply don't make business sense, and as a result, I have pursued other options. The current prices bear no resemblance to what the prices were over a year ago. Blame it on their fleet purchase prices or whatever, or the fact that they need to report a profitable quarter, the end result to me (and you) when it comes to a subcompact, compact, or etc. car, is out of whack.

...they're claiming it's the smaller fleets and the hard time the companies are having selling their used cars as well but it's highway robbery in this supposedly 'deflationary spiral' period and I don't think they will be able to sustain this gouging for long. Was visiting AUS for a day and a half this week, looked up compact rental rates, couldn't find anything under $98 / day, or $230 all in for my stay, from any company. Absurd. I rented nothing, actually used Super Shuttle in protest.

In some places, where the airport is far from town, airport rental car rates can be surprisingly high and there are few if any off-airport branches nearby. (Ex Kansas City, Norfolk, Cedar Rapids) This makes shared shuttle vans a competitive option. In fact, I've used Super Shuttle in Kansas City. They have a presence in several markets. The rates are relatively good, especially if the group you're visiting has a corporate rate plan. The downside is they frequently circle around for an hour and leave once the blue 15 passenger van is finally full. (One row of seats is removed to make room for luggage, so it's not necessarily as annoying as you might think.)

Hotel courtesy shuttles can also be a good deal. I've used many of them, but be advised that those hotels tend to be in heavily travelled areas where the rates can be high. Also, with all shuttles, watch out for reliability and scheduling glitches.

Here's a price example from my San Francisco mention above.....November 3rd, one day, typical rate for a compact, $180 with taxes ($129 base rate, $51 taxes)...are you kidding me?

If a rental company pays $300/mo to own the car, and let's say they can sell it for the remaining balance, it would only take them 3 days or so per month of rental to break even; if they actually have it rented half the month, what a windfall...

No freaking way would I pay $180 a day for a car! My roundtrip cost across country is less than that!

Adios car rental ripoffs; it's no wonder your business is down...I'll go with airport shuttles.

If a rental company pays $300/mo to own the car, and let's say they can sell it for the remaining balance, it would only take them 3 days or so per month of rental to break even; if they actually have it rented half the month, what a windfall...

Ha!

Most rental cars are leased on short lease cycles.

That puts the cost much closer to about $750 per month (for a typical midsize vehicle). Higher when you count in maintenance costs, overhead (staff to handle the fleet management), uncollectable damages, etc.

If an agency can maintain a year-round occupancy rate of 80% (fairly good for an average), that means that the break-even point is $31.25 per day. And every time you pay less than $31.25 per day, or the low season makes occupancy rates fall below 80%, someone somewhere else is having to pay more. Hopefully not $100 per day more (I'll agree that's insane), but if you're going to make an argument, at least base it on realistic numbers.

Look for more rental agencies to start buying and owning their own cars (and holding onto them for much longer---60,000+ miles), which will bring the costs down closer to (but not quite what) you gave.

Oh, and think of the value you're still getting: you're renting a $20,000+ car for less than you can rent a $2,000 (used) Genie 36" man lift for a day. Maybe we should storm the gates of equipment rental places with our angry lynch mob--they're the ones truly ripping us off!

Here's a price example from my San Francisco mention above.....November 3rd, one day, typical rate for a compact, $180 with taxes ($129 base rate, $51 taxes)...are you kidding me?

If a rental company pays $300/mo to own the car, and let's say they can sell it for the remaining balance, it would only take them 3 days or so per month of rental to break even; if they actually have it rented half the month, what a windfall...

No freaking way would I pay $180 a day for a car! My roundtrip cost across country is less than that!

Adios car rental ripoffs; it's no wonder your business is down...I'll go with airport shuttles.

I havent posted recently but I had to comment on this. Rental companies pay approx $300/month for a car???? By this logic, a brand new car that was rented for 6months and had 25,000miles put on it, would have only depreciated $1800??? I wish a $25,000 car is worth $23,200 AFTER 6months . True cost of an avg fleet is closer to $800-$850/month (more these days with the lack of attractive fleet programs), thats not even factoring interest, maintenance, staffing, rent, overhead etc etc. Bear in mnd that most business comes from corporate travel which have negotiated rates, which are constant year round. When the retail rates are $100 or more per day, its because fleet is tight and it is a way to "cool" off demand. It is corporate travel that carries the rental companies, not the handful of retail rentals at a high dollar figure.The subject of the new fleet programs in the current economy have been discussed in other forums but I had to chime in with this $300/month that was pulled out of thin air.