Heitman said a Miami sales rep for Dollar told him recently that he would automatically be charged as much as $2 million if he got into an accident unless he purchased their insurance. We anticipate demand for car rentals to be strong throughout and beyond the summer, especially in popular tourism destinations,” a Hertz representative said.Ĭustomers have said that it’s not just the sticker price that’s driving up their rental bills, but tacked-on fees that pad companies’ bottom lines. “We’re seeing strong demand for car rentals across the country and actively adding vehicles to our fleet nationwide amid the microchip shortage that continues to impact the car-rental industry. They’re only supposed to hold a customer’s reservation for an hour and will rent the car out to someone else who shows up - which has caused “entitled” customers to yell at her, she said. The high prices have come hand in hand with more customer tension. “It takes a lot of patience.” She has seen people pay as much as $500 a day for cars, with the rates shooting up around weekends and holidays. “I get cursed out all the time,” she said. One Brooklyn Hertz employee, who asked to remain anonymous for fear of losing her job, said that the experience of dealing with sticker-shocked customers can be stressful. Now that the company has emerged from bankruptcy, Hertz’s shareholders are getting an unusually large payout, thanks to a host of private-equity companies that bought in. Avis Budget Group, one of the big three rental-car companies and the owner of Zipcar, recently saw its stock price hit an all-time high. In a whiplash-inducing turn of fortune, the rental-car companies are now in the black, having slashed their expenses and cut down on services. Prices have risen so high - about 88 percent from a year ago - that rental cars are now one of the key factors driving the biggest rise in inflation since 2008. Then, just as a microchip shortage stalled car manufacturing and stymied the ability to restock fleets, demand bounced back. Last May, Hertz filed for Chapter 11 bankruptcy, which allowed it to keep operating as it paid down $18 billion in debt. When governors issued stay-at-home orders and travel collapsed, the major rental companies sold off some 770,000 vehicles, or more than a third of their total fleet. The rental crisis has its roots in the early days of the pandemic. “They’re capitalizing on the poor conditions of public transportation,” said Joseph Heitman, a 26-year-old dance instructor who spent about $500 on a two-day rental from New York to Connecticut for Mother’s Day weekend. With fewer vehicles and plenty of eager travelers still wary of public transportation and airports, customers are coming up against rental-car companies that seemingly act with impunity, jacking up prices for some and denying others for what can appear to be arbitrary reasons. Prices online are routinely over $100 a day for midsize cars- and that’s before insurance and other dubious add-ons.
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Garages normally full-up with cars are these days sitting practically empty. To rent a car right now is to live through an expensive, frustrating American nightmare. In the end, though, he still ended up paying about $500 for the two-day rental - and had to wait in a line of more than 30 people for more than an hour just to get his sedan. “That was the final straw,” he said. (A Hertz spokesperson defended the 5 percent surcharge as common among airlines and hotels.) Frustrated, he canceled the reservation and went to Budget, one of Hertz’s biggest competitors. As a member, he tried to talk with a representative to get a better deal, but an automated message told him Hertz would tack on a 5 percent surcharge to speak with a human being. When he tried to rebook it, the prices had shot up substantially: $1,100 altogether. The weekend rental cost $425 for a midsize car - “a little high, but reasonable,” he said.Īs it got closer to the drop-off date, Ford changed their flight to arrive on Saturday, a day later. He and his family were flying up from Miami, where they live, to drop off their son at West Point at the end of June.
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So at the beginning of the year, Ford, 52, booked a car for four days from Newark Airport with the company. “You get out of your flight, you walk up, there’s a big board there, they tell you your number, you walk over and get in your car.” While most travelers may have a hard time distinguishing one rental company from another, Ford preferred Hertz and had been a member for more than 20 years. He’s a salesman, now pitching construction chemicals, but he used to sell cell-phone towers, so he’d have to rent cars to go to remote places. Photo: Getty Imagesįor about two decades, Troy Ford spent three weeks out of every month on the road.