IN A history spanning almost a century, car rental has grown from 12 Model T Fords hired out by a certain Walter L. Jacobs of Chicago in 1918, to a mega industry that gets almost as many hits on Google as Lady Gaga. Over the past two or three years, however,
even Hertz, the world’s leading car hire company, whose founder bought out Jacobs in 1923, has felt the braking effect of worldwide recession. But, whisper it, while it is too early to talk
of a full return of industry and consumer confidence, a number of observers have noted the green shoots of economic recovery. That said, they are sprouting in a changed environment, one where corporate spending on car hire has been scrutinised over and again in order to cut costs, and where implemented budgetary restraints are seemingly now set in stone. Not that saving money is the only problem: corporate hirers are facing a range of issues, from the future of their own fleet of vehicles to meeting the challenges of going green to reduce their carbon footprint. The British Vehicle Rental and Leasing Association (BVRLA), which has 500 members and represents the interests of over two million business car drivers, is in a position to offer a unique perspective on both industry and consumer reactions to the financial crisis. Says chief executive John Lewis: “Like many industries, the car rental sector has experienced a slow and uncertain emergence from recession. Corporate customers are continuing to tighten their belts. With reduced travel and expenses budgets, car rental will come under pressure, not least from shorter journeys, where the cost of an extra night in a hotel forces the traveller to cut short the trip.” Roger Hancock, managing director of Thrifty
Car Rental, agrees with Lewis’ assessment and provides empirical evidence of the challenges facing the customer. “With the economy struggling to recover as quickly as was initially hoped, cash flow continues to be a major concern for SMEs,” he says, “and many have had to adopt more flexible ways of working in order to survive.” He continues, “This has undoubtedly translated into the way they handle their fleets, with over a quarter opting to downsize. A further one in five have introduced flexible car rental schemes, and a significant 17 per cent now actively encourage staff to use public transport more often.” Note the term ’flexible’. It has become the
Pictured: lined up and ready to go at National car rental
buzz word for both industry and consumer, with Avis, Budget and Hertz all launching no-penalty schemes that allow clients to tailor their car hire to short-term needs, a move matched by competitors’ evolving products. Also increasingly popular are no-contract, pay-as-you-go programmes. These enable customers to hold on to their cash and keep a wary eye on how it is spent, with Budget’s Business Connections, Europcar’s Business
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