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Lock In That Summer Car Rental

I’ve been hearing rumblings about a possible shortage of rental cars this summer. A reader asked:

“Our car hire company has informed us recently about shortage of cars in Spain this year. It cited news reports from the Telegraph and CNN. Should we worry?”

The short answer is, “You needn’t necessarily worry, but you should book as early as possible.”

Why a Car Shortage?

DialAFlight, a large London-based online travel agency that books rental cars worldwide, issued a press release confirming the shortage, which will extend to the U.S. as well as Europe. The reason, says the agency, is that, “In North America, ongoing upheaval in the auto industry has raised significant concerns about the numbers of vehicles available to rental companies. With major market players (including Chrysler, Ford and General Motors) closing factories and losing assets, fewer cars are coming off the production line.” The release continues, “A number of suppliers have simply held their stock levels due to the economic climate, and are now being caught out as summer travellers continue with their holidays, unperturbed by the recession. We are already receiving Stop Sales alerts for August as there is a shortage of cars in some areas.”

Early Bookings

Clearly, as with any travel service, the best way to cope with a possible shortage is to book as early as possible. That’s particularly easy with rental cars, where you can typically book without having to make a full nonrefundable payment upfront.

But cancellation fees are creeping into this market. Hertz is adding a $25 fee to cancel some prepaid reservations; it’s $50 if you just no-show. As far as I know, that fee applies only to prepaid reservations made my phone or through travel agencies and not to online reservations or the more common “pay when you return the car” contracts. However, some companies tout prepaid rates that are better than regular rates, so factor in the possibility of a cancellation fee if you do a nonrefundable.

Alternative Bookings

If you run into a “not available” notice when you try to reserve, check the obvious alternatives—a bigger or smaller model, a downtown pickup rather than airport, and such. If the national chains can’t find cars, consider renting from a local company that doesn’t list on the big online sites. You can locate them by checking classified phone directories or online searches.

Also, if you’re sure you won’t cancel, consider using Hotwire or Priceline for your rental. Regular rates have been climbing lately—a lot in some areas—and the best way to cut your costs is to rent from one of the “opaque” sites. You can specify the class of car and pickup location you want, so you probably don’t really care what company supplies it.

Reservation but No Car?

Normally, as long as you have a firm booking, a shortage shouldn’t bother you: Someone else will have a problem, not you. But occasionally you’ll find yourself at a rental counter with a firm reservation, only to be told, “Sorry, we’re all out of cars right now.” Here, your options are limited, and you often face a choice among unattractive alternatives. Two overriding rules apply in that situation:

  • Your reservation is a firm, legal contract, and the rental company is obligated to honor it.
  • On the other hand, a rental agent can’t run out and buy a new car for you—you have to live with the realities.

No federal laws govern oversales or failures to deliver rental cars, as there are with airlines, and I don’t know of any local laws other than general contract law. The rental car industry doesn’t even have a “standard” solution comparable to the hotel industry’s “walking” practice. Instead, when the type of car you reserved isn’t available, the usual approach is to (1) upgrade you to a better vehicle, if available, at no additional cost; (2) offer a lower-grade car, with a rebate of the rate difference; or (3) arrange for a nearby company branch to provide a car and deliver it to you.

If your rental company can’t come through on any of those options, the ideal practice is to find a car at a competitive agency, rent it for you, and absorb any rate difference. But that doesn’t always work, either: If your original company is out of cars, the others may be out, as well. Or the agent doesn’t volunteer to go that far: An agent at the Kona airport once told me, for example, “Hang around for a few hours and someone will return a car that you can have.” Just the way I wanted to start my vacation.

In theory, in such a case, the rental agent should pay for a taxi to your hotel and a return taxi to the airport later or the next morning to pick up the car which will presumably be available by that time. Again, however, no rules govern this sort of practice, and I’m sure many agencies ignore it completely.

Being in the right, contractually, is one thing; having a car to drive is another. If you’re caught with a rental car agency that can’t deliver as promised, the agent on the scene will usually offer some kind of fix:

  • If the fix is anywhere close to acceptable, accept it. Depending on circumstances, ask for a reduction in the rate to compensate for any inconvenience.
  • If the supplier’s fix is unacceptable, arrange your own fix, even if it’s expensive. Keep your receipts and, when you return home, demand a refund of any expenses over what you should have paid. If the company refuses or stalls you, take it to small claims court.

Your objective is normally to salvage the most of your vacation, not to argue a point. Get on with what you want to do, and have the argument later.

The Other Stuff

This year, more than ever, be on the lookout for unexpected extra fees and charges. I’ve covered this topic often, and I’m sure I’ll return to it many more times. Be alert—the rental companies are hungry.

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