As founder and chief executive of EV Rental Cars, a Los Angeles agency devoted solely to hybrid vehicles, Jeff Pink is one of the few U.S. business owners actually profiting from the current surge in oil prices, according to The Wall Street Journal.
Daily rental rates range from $35 to $75 for the gasoline/electric hybrids in his fleet, including Toyota's Prius, Camry and Highlander, the Honda Civic and the Ford Escape. EV's cars can command at least a $10-a-day premium over most comparable all-gas rentals. Pink says EV turned a profit last year on revenue of $4 million and expects to take in $5 million to $6 million this year, The Wall Street Journal reports.
With 425 cars and eight rental locations on the West Coast, EV Rental is barely a blip on the radar screen compared with car-rental giants. But the company's stable of hybrids has thrust it into the industry spotlight.
Even Enterprise Rent-a-Car Co., one of the largest rental agencies, has only about 50 hybrids in its fleet of roughly 650,000 cars, and it can't expand that portion because the supply of hybrids is so tight. Because he’s making a profit and with an additional boost from government grants, Pink can pay retail prices for hybrids, something the big players can’t afford to do.
As EV transitioned its vehicle stock to hybrids, events conspired to give it a surge. California decided in 2005 to let hybrids with single drivers ride in High Occupancy Vehicle lanes, and fuel prices rose dramatically.
But when and if gas prices fall, consumer appetite for hybrids could wane. Or if the reverse happens and consumer demand for hybrids takes off, manufacturers might increase supply, allowing big rental agencies to potentially squeeze EV Rental out.
Pink says if he can build up enough inventory, and if the hybrid market takes off, EV Rental might make an attractive acquisition target. He expects to have 1,500 cars by the end of 2007 and 2,500 the next year.