Car Rental Q&A: What's the Biggest Threat to Car Rental in the Next Year?

For this issue's car rental Q&A, we asked several international car rental show attendees for insights into their businesses in 2016 and the industry in general.

Q: What do you think the biggest threat to car rental will be in the next year?

Rudy Callegari, co-founder of Edge Auto Rental:
“Uber, Lyft.”

Brad Kjar, director of operations at U-Save Car & Truck Rental:
“The industry getting in the way of consumers’ —specifically millennials’ — adaptation of technology and not being able to keep up with tech advancements: The rise of Uber and Lyft demonstrates how the taxi industry failed to meet customers’ expectations. The industry will have to develop and improve its digital connectivity and ease of use for our consumers or another player will enter the market with a better way to do it for us.”

Jordi Rivero, chief product officer at Mex Rent-A-Car:
“Speaking for Mexico, the competition is quite tough. You can find daily rates under $1, and there are even some locations that have a weekly rate around $3. Also, another threat is the high prices that the insurance companies charge us in order to be able to sell counter products.”

Roger LaTour, general manager at Walser Automotive Group:
“In the local rental market, the manufacturers have been aggressive to push dealership rentals. They apply specific rules and incentives that make it difficult for local car rental operators to accommodate, thus providing a more convincing rental model for the dealership owners.
“Available fleet programs for the smaller operators: As manufacturers tighten up production, both retail as well as commercial, demand continues to be strong, yet rental fleet purchases at competitive incentives are harder to qualify for.

Shantelle Ford, rental manager at Tom Wood Rental:
“In a dealer-based rental program, more manufacturers are requiring 100% branding for their loaners/rentals. What if you have a Jaguar Land Rover store as we do? It’s $60,000 to $80,000 for a Jaguar, and you can only charge $45 per day against warranty.
“I support the new safety recall law that protects the consumer, but it also protects rental companies; it’s just hard for some to see. I believe we will see more and more recalls, which means more grounded vehicles.”

Q: Do you see your business growing in the next year?

Callegari:
“We are growing as we cater to business-to-business and the film market that shoots in New York City. With the economy being strong, low gas prices, and low interest rates, it’s a good time for Edge Auto Rental.”

Kjar:
“Yes, U.S. and international growth are expected to be very strong. Industry consolidation has left a void for our product, and demand has not been stronger.”

Rivero:
“All areas of our company are growing, especially the commercial one. With our new business relationship with Expedia Group, Mex Rent-A-Car is acquiring an extra strength. Our new affiliate program is getting bigger and delivering the Mex brand in different countries in the Caribbean and South America.”

LaTour:
“We believe our growth opportunities can occur by outperforming all other rental car operators as it relates to the customer service index (CSI) and exceeding first-time renters’ expectations. Having the right cars, the right people, and the right training makes this a game-changer for us.

Ford:
“Yes! We currently are a service/insurance replacement rental company that serves our dealerships. In the next few months, we will open a franchise location (Sixt) in our local market. We will still serve our dealerships, but we can also serve the retail market. It is a game-changer for us.

Comments

  1. elma [ May 29, 2016 @ 01:01AM ]

    I believe we will see more and more recalls, which means more grounded vehicles. first of all car rental company and other companies, manufactures sellers should be more focus on defected cars that they rent sell lease, there are thousand of people, children who did not make it through defected cars I was one of those people who did survive the car crash with a defected car that i rented that had a recall I am speaking for those families children, people who are not here now who can not tell the real store of what really happened in the car me i was only going 25mph and the car was total because the bumper was fiber grass or plastic. the airbag exploded out of the plastic compartment Jagger knife that puncture a hole on my left leg cause other parts of my legs to be cut up and scared permanently air bags released extreme smoke i was trapped in the car by the airbag on drivers side the extreme smoke almost killed me from smoke inhalation i was in n out of conscious throwing upwhat save my life is a GPS that talks to me great invention. i did not know that the car i was renting was recall for ati-brake and airbags.. wow companies should care for the well being of consumers. that why I respect the consumer union backed bill act (5.921) I am speaking for the people who are not hear today.i am speaking for them REST IN PEACE

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