LOS ANGELES -- In the past week, Los Angeles International Airport authorities have faxed notices to off-airport independent rental operators, informing them of plans to terminate their existing agreements May 31.
To remain a licensee, the notice says, off-airport operators must pay a fee to the city of $7,500 annually or 8% of their total gross receipts -- whichever is higher. In addition, off-airport operators will be permitted to pick up airport customers only at Lot C, a remote parking lot to which rental customers will be shuttled by an airport-operated vehicle. The frequency of such shuttle pickups outside the terminal hasn't been determined.
On-airport rental operators, however, will continue to pick up customers right outside terminals.
Los Angeles World Airports, which operates LAX, has given off-airport operators less than a week to decide whether to accept the new agreement's terms. Without licensee status, rental operators are prohibited from advertising in airport terminals or operating courtesy phones there.
However, the prospect of forcing customers to be double-bused -- from the terminal to Lot C and then to the rental facility -- has most off-airport operators predicting their business' demise unless the terms of the new agreement change. The companies affected by the policy shift have begun organizing to oppose terms of the new agreement.
"This would pretty much destroy all of the small car rental companies, without question," said Sam Arbalani, general manager of Global Rent-A-Car.
The new agreement would triple annual airport fees for his company, Arbalani said. What's more, the inconvenience of being double-bused would result in the loss of most airport customers.
"We are confronting this problem," Arbalani said. "If push comes to shove and we have to hire a lawyer to deal with this in a legal battle, we'll do it."