Rental operators appear to be maintaining normal vehicle purchasing levels, while strong wholesale values are helping them generate favorable returns on resale, according to Mike Muehlenfeld, general manager at Walser Automotive Group, an independent seller of multiple vehicle brands to car rental operators.

However, production disruptions and the limited availability of lower-cost vehicles remain concerns heading into the 2027 model year.

“The market has been really strong,” Muehlenfeld said in an interview with Auto Rental News.

On several recent vehicle programs, he said operators realized a strong $2,000 per vehicle at disposal while depreciating at their normal rate. The strong current used-vehicle values partly reflect the lower number of vehicles placed into service a year ago, leaving fewer units in the marketplace today.

Operators appear to be buying at customary levels. “It looks like people are buying what their normal purchases are — not really up year over year, but very similar to year over year,” he said.

Hyundai Strike Creates Delivery Concerns

One immediate supply concern is the labor dispute affecting Hyundai Motor’s South Korean production. Partial strikes began in July after wage and bonus negotiations stalled, disrupting production and contributing to a decline in the automaker’s July sales.

Muehlenfeld said the disruption has created uncertainty around deliveries, which could affect operators planning fall fleet additions.

“For the 2027 model year, any fall deliveries are very much a concern at this point,” he said.

Affordable Vehicles Remain Difficult to Source

Beyond the immediate production disruption, one of the rental industry’s continuing challenges is finding enough affordable vehicles to fill compact and intermediate rental classes.

“The challenge is getting small, cheap cars,” Muehlenfeld said. “Those $20,000 to $22,000 vehicles are harder to come by.”

As the number of traditional compact sedans has declined, small SUVs and crossovers are increasingly filling that role.

Fleet Diversification Helps Reduce Risk

Production interruptions are also a reminder of the importance of spreading purchases among multiple manufacturers. Muehlenfeld cautioned operators against placing too much of their fleet with any one automaker.

He recommends limiting any one OEM to approximately 20% of the fleet to reduce the potential effect of a disruption.

A diversified fleet can reduce exposure to production delays, allocation changes and recalls that could suddenly interrupt deliveries or sideline a large number of vehicles.