Cloudship

The car rental agencies are having a tough time because they do not have enough cars. Cars are now hard to come by, and they got themselves in a jam when they got rid of too many with Covid.

I was thinking, why don't the car rental agencies get together, find a couple of car models which are being discontinued and a factory that may be be closing, and produce their own cars? I know this wont help the current crisis, but in the long run it may protect them in case it happens again. Not to mention, it would get rid of the middle man. All can invest in a company that build older models specifically for fleet sales.

Plato90s

For the same reason that Delta and Emirates doesn't build its own jets - it's not cost effective.

Manufacturing is a capital-intensive business and car rental companies rely on float from its customers to servie debt on the depreciating asset (cars) that it finances. That was illustrated when Hertz was forced into bankruptcy during the pandemic when people stopped renting and they had to quickly sell off their rental fleet .

DenverBrian

"Find a couple of car models which are being discontinued and a factory that may be closing, and produce their own cars" is wildly simplistic. Any discontinued car model is IP belonging to the current manufacturer. They're not going to give up their brand for nothing. Otherwise, someone would have snapped up Pontiac and Oldsmobile in the 2000s.

SirFlysALot

However they did have exclusive models. For several years GM sold Impalas strictly to rental agencies.

gaobest

The car rental agencies are doing as well as ever before. They probably have better profit now compared to before. Higher rental rates.

krazykanuck

IIRC it's because certain models so terribly in the retail market they dumped them into fleet sales. Similar to what Ford did with the Crown Vic. They stopped selling them retail, rebadged the exact same thing, called it a 'Police Interceptor,' and moved on. I think the Crown Vic line is now years defunct but they have applied the PI branding to Explorer SUVs and other things destined for law enforcement.

TomMM

Delta briefly stepped into the refinery business some years ago thinking they could get an advantage with fuel prices.

tdott

No one wants to drive a brand new 2010 Pontiac Sunfire or whatever in 2022. lol

Would suck if all the rental were some crappy old model that doesn't get upgrades and has super old tech.
I don't think those were very safe in their time, in today's world they are probably way behind safety wise.

But yea it's not exactly easy to just build their own cars either.

FlyinHawaiian

Hertz was a subsidiary of the Ford Motor Company for a period starting in the late 80s. I remember the car classes aligning pretty nicely with the Ford models; Compact = Escort, Midsize = Contour, 2-Door Fullsize = Thunderbird, Fullsize = Taurus, and Luxury = Town Car.

There are still "fleet models" in many carmakers lines.

pinniped

I was a weekly Hertz renter in the 90s. I remember the Premium car was a loaded Mercury Sable for a while. Our corp code worked on anything up to Premium.

OK, we kind of mock most 90's cars at this point - they weren't designs that aged that well - but as rental cars go, the Hertz/Ford era was pretty good. Avis and National had a lot of stripped-down GMs unless you were renting Luxury and could get a well-trimmed Caddy.

FlyinHawaiian

I am forgetting the Premium = Crown Victoria; I guess I have a mental block after driving so many of them.

pinniped

I remember getting those when I rented at MCO/TPA. (Or the Merc equivalent, Grand Marquis.)

Maybe the Sables were a more northern thing? Crown Vics were absolutely useless in snow. I got Sables at MCI (where I got to know a few of the employees over the years) and maybe ORD... Sables may have been more early 90s than late 90s too. Eventually Hertz started getting a little more diversity in the fleet.

Cloudship

Hertz was Ford. National was GM. And today, Silvercar is Audi.

At this point, and in reality, for most renters outside of us frequent users, there is very little choice in actual model, nor is there much care. When was the last time you actually got a decent selection renting? Heck, most of time now you stand their waiting for the next car to show up. That isn't going to change - car companies see high demand driving higher prices they can charge.

In the past GM< especially used to continue production of car lines for fleet buyers. It isn't just limited to rental car agencies. But GMs stock price was driven up by closing plants, and since those were not as profitable, they were the first to go. That is where the fleet idea comes in. You would need to find both a couple of models on the same platform being discontinued as well as a plant that is closing that makes them Work with that manufacturer to create new subsudiary, keeping it pretty separate from the other brands. Get the rental agencies, and even some of the larger fleet buyers, to invest. Do some tweaking on the nose and lights to give it a bit of a different look - GM is particularly good at this - and sell specifically to larger fleet purchases. The car companies used to commonly license out their car to smaller markets that they were not active in, so nothing new to them. The manufacturer till gets sales, the rental agencies get enough cars and better prices, and it doesn't hurt the stock price like large fleet sales of current production models would.

IAHtraveler

Similarly, Chrysler owned Dollar for a period of time: https://www.dollar.com/AboutUs/Facts.aspx

Auto Enthusiast

Where would the chips come from? How about dealing with shortages and inflated costs of other materials?