Overview – The Rental Car Shortage
The COVID-19 pandemic has severly impacted the rental car industry. Major companies responded to the sudden and signficant drop in travelers have downsized their fleets considerably. As travel resumes, there is now a shortage of vehicles and many travelers who had been used to affordable cars that were easy to source now feel price gouged. In many place people cannot even find a car at all. Many companies in leisure destinations are sold out just in time for rebound.
On the positive side, while the sticker shock of available rentals may be frustrating, the shortage does provide a glimpse of hope for a recovery in travel – at least leisure travel this summer. Travelers should certainly expect that this supply crunch will continue in leisure destinations meaning travelers need to be more proactive than ever to get a car (especially an affordable one).
“More than 75 percent of those recently surveyed in a weekly analysis by the market research firm Destination Analysts said they planned to travel in the next three months alone”
What Happened?
Avis Budget Group (Avis, Budget brands) saw 2020 revenue down 40%+ and it sold 250,000 vehicles while Hertz (Hertz, Dollar and Thrifty brands) filed for bankruptcy protection and reduced its fleet by about 40%. The global shortage of microchips, which is slowing car production, is not helping revive the industry. Furthermore, Enterprise Holdings (Enterprise, Alamo and National) said it expects significant demand to be with us “throughout the coming months, especially in pockets of the country popular with travelers. At the same time, there are challenges in vehicle supply, due in part to the recent global chip shortage impacting new vehicle availability.”
What Now?
Below is a list of key considerations when booking rental cars now:
– Secure your car early – as early as other travel arrangements or even earlier, leveraging the current flexibility in travel
– When searching before arriving at a destination, search the broader neighborhood which may have more rental locations (and beyond airport locations where cars can be most scarce)
– When searching within a destination, use Google Maps to find car rental locations near your accomodations – hotels or home rentals. Many times, hotels have car rental companies nearby or within their properties
– Costco/AAA/AARP – or other key retailer / association memberships – can be sources of meaningful discounts or even availability on travel services including rental cars
– AutoSlash uses rental car company coupons and discount codes to sort through search results that could save travelers time
– For an alternative to traditional rentals yet still having the privacy and control of a rental vehicle, Turo (Airbnb for cars) allows people to list their vehicles for rent and set the rental terms
– For an option to bundle rental cars and accomodations, consider RV sharing services – e.g. Outdoorsy or RVshare
– Of course, there are existing alternatives to rental cars as people start to feel safer using them – ride share services, bike share options and public transportation
– For a highly nontraditional choice, consider renting a truck from Home Depot (usually for DIY projects / transport of supplies) or even U-Haul vans / trucks. Of course, families considering these services can find it difficult!
Good luck and travel safe!