Originally Posted by
WChiCC
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.