Expedia: Higher Rental Rates Have Decreased Car Bookings

During a conference call to discuss first-quarter results, Expedia Inc. cited higher car rental rates as a reason why the company has lowered its earnings outlook. Following the guidance comments, Expedia stock fell as much as 11%, the Wall Street Journal reported.

Constrained fleets have led to higher rental rates, and that trend has had an impact on car rental booking volume, the online travel company said.

In particular, Expedia’s Hotwire opaque discount travel site has seen less demand for rental cars. Hotwire customers book rental cars at a discount without initially knowing which rental brand – Alamo, Enterprise, Hertz or National – will provide the car. These customers book on price alone; brand loyalty isn’t a factor. But in the current business climate, the gap between discount and regular rates has narrowed substantially. As a result, many price-sensitive customers have stayed away.

Expedia CFO Mark D. Okerstrom said he didn’t expect car rental bookings to improve anytime soon.

To read the Wall Street Journal article (subscription required), click on the URL. http://online.wsj.com/article/BT-CO-20130425-721454.html?mod=googlenews_wsj

To listen to a recording of the April 25 conference call, click here to register and gain access. 

Comment On This Story

Name:  
Email:  
Comment: (Max. 10000 characters)  
Please leave blank:
* Please note that every comment is moderated.

 
 

Newsletter: Sign up to receive latest news, articles, and much more.

Read the latest

Auto Focus Blog: A blog covering fleets, auto rental and the business of cars

Will Cars Become Transportation Appliances?

The cars are still the stars, but this year’s L.A. Auto Show revealed an auto industry at a crossroads.

U.S. Car Rental: Sanity in the Face of Disruption

A newfound austerity in fleeting is producing a domino effect of benefits for 2018.

Understanding The Fleetification of Everything

As fleet miles increase exponentially, and as new stratum of fleet enter both consumer and business use cases, the "founding fathers" who gathered at Fleet Forward in Miami last week have some work to do.

Job Finder: Access Top Talent. Fill Key Positions.

>