For decades, car rental has been one of the simplest and most dependable aspects of booking a trip. In France, Italy, Spain and the US, a family-sized vehicle was readily available at £50 or less per day in the years shortly before the pandemic, even in peak summer months. But as many prospective travellers are finding this year, rates have increased two- or three-fold. At some destinations in August, findings were even more bleak: cars were sold out entirely. So, what’s gone wrong — and what can you do about it?
How expensive is car rental?
In popular holiday spots such as Palma, Pisa and Paris, a daily rental of £100 is about the best you can hope for this summer. In the US states of California and Florida, basic rates are lower — typically around £60 a day — but additional costs, including insurance and toll payments, push prices higher.
Closer to home, rental rates in Ireland are at unprecedented levels. At Dublin airport, the cheapest one-week, pay-on-arrival hire at Avis for early August is over £1,000 for a tiny Kia Picanto. The firm also has a Tesla electric vehicle available for £2,595, or over £15 per hour. Before the pandemic, rates for small cars here were as low as £15 per week.
What’s gone wrong? In 2019, ferocious competition kept rates down and availability high. But from early 2020 onwards, the Covid-19 crisis saw demand collapse. Instead of expanding their fleets ahead of the summer peak, rental firms were left with parking lots filled with billions of pounds’ worth of rapidly depreciating vehicles that no one wanted to hire. Inevitably, they sold cars off in their hundreds of thousands. Hertz Global Holdings, which includes the Dollar, Thrifty and Firefly brands, sold more than 200,000 cars — about one-third of its pre-pandemic fleet — in 2020.
Once mass travel resumed, customers returned in large numbers, partly because travellers felt better protected from Covid-19 in a rental vehicle than on public transport. Companies struggled to meet the demand. In addition, the worldwide shortage of microchips stifled car production, leading companies such as Hertz to say it couldn’t guarantee being able to purchase sufficient numbers of new vehicles at competitive prices.
How can I avoid exorbitant fees?
As with hotel rooms, committing in advance generally saves money. That Dublin airport rate of over £1,000 for a tiny car for a week falls by one-sixth, to £842, if you pay upfront, although it does bring extra risk if you need to cancel.
If you pick up your vehicle at a city-centre location rather than the airport, you’ll avoid the commission charged to the car rental firms by the airport. For example, a short-notice rental at San Francisco airport with Enterprise costs £90 for the smallest vehicle, compared with £67 at downtown Oakland, across the Bay — easily accessible in 43 minutes from the airport by train.
Rental may be cheaper if you sign up for a loyalty scheme or use your airline frequent-flyer status. Booking an Avis vehicle through the British Airways Executive Club, for example, gives a second driver as an automatic entitlement.
How long will this last? While previous supply shortages haven’t been so extreme, they show the way forward: when the industry makes excessive profits one year, companies tend to ramp up capacity the following year, and prices eventually revert to sensible levels.
Hot topic: why has hiring a car become so complicated? - National Geographic UK
Read More
No comments:
Post a Comment