Rental car prices have skyrocketed, if you can even find one. Blame the COVID pandemic
Monte Foreman-Powell has a message for travelers hoping to rent a car: “Brace yourself.”
Foreman-Powell was having a tough time making a reservation for a rental car before his flight from Omaha to Miami, he told KETV in Nebraska.
“I’ve never seen where it says literally sold out, sold out, sold out, no rentals available,” he said. “There was only like one place that had openings.”
Things got worse when he landed. Foreman-Powell said he waited more than four hours before a clerk told him they’d given the car he’d booked to someone else, KETV reported. He then had to wait around for another car and finally, after hours, got on his way.
Foreman-Powell’s story isn’t uncommon.
As more people become vaccinated against COVID-19 and are ready to travel, car rental companies are having a difficult time meeting demand — especially in tourist hot spots like Florida and Arizona.
Rental cars are so scarce that in Hawaii, some travelers have resorted to renting U-Hauls, Business Insider reported.
“We have seen a considerable uptick in U-Haul rentals from customers who are visiting the islands now,” Kaleo Alau, the president of U-Haul Company in Hawaii, told Insider. “We realize this demand is occurring when tourists are unable to secure a rental-car, or they learn that our rental fleet options are more affordable.”
The trend has started cutting into U-Haul availability for locals.
Others travelers, like Chad Preuss, are turning to rideshares in the face of hefty rental costs, though he said rideshare prices are also up, KETV reported.
But rideshares aren’t always an option for larger groups.
Deadra Rahaman traveled to Fort Lauderdale from Detroit for her daughter’s spring break and crammed her group of five into a Toyota Corolla from ACE Rent a Car — for $2,000 a week, The Detroit News reported.
“You can use Uber if there’s one or two of you. It was five of us,” she told the outlet. “That might be challenging, and what if we couldn’t go somewhere? All those things were running through my head, just how we are going to get around.”
When the pandemic hit last year, car rental companies saw a major drop in demand — to the tune of 90%, Jonathan Weinberg, founder of AutoSlash.com told KXAN.
He said rental companies “shifted into survival mode,” selling off “hundreds of thousands of vehicles in order to survive.”
Now, they can’t meet demand as people return to travel — and it’s driving prices sky-high.
Travelers used to be able to find rental cars for $20-$35 a day, Weinberg said. Now that figure is anywhere between $75 and $500, KXAN reported.
“You’re paying more potentially for a rental vehicle on a daily basis than a hotel room,” Neil Abrams, president of research from Abrams Consulting Group, told the Detroit News. “That’s been very rare in my experience.”
To add to the problem, rental companies are having difficulty replacing their fleets due to slowdowns in the manufacturing chain.
Tyson Jominy, J.D. Power’s vice president of data and analytics, told the Detroit News that car makers were faced with shortage after shortage of car parts, including microchips, tires and resin.
Further, fleet sales have become less profitable than retail.
“Automakers are prioritizing more profitable sales, which are from trucks and SUVs and higher trims,” he told the newspaper. “The fleet channel is not as profitable as retail. There are usually less-equipped models in the fleet channel.”
Those in the industry say they hope prices will drop as travel picks up.
“Hopefully with the uptrend we are seeing and more money coming into the travel industry hopefully things will slowly build up and balance for companies that they can reinvest in more vehicles,” April Engram, a communications specialist with AAA, told WENY.
Weinberg, of AutoSlash.com, told KXAN it could be September before travelers see noticeably lower prices.
If you must rent a car, Enterprise recommends booking as early as possible and providing flexible travel dates when possible, KETV reported.
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