Your browser is out-of-date!

Update your browser to view this website correctly. Update my browser now


Mix Blog Live: Rental Gouge

Ever on the road, live sound pro Steve La Cerra recounts a wretched rental counter encounter—and considers how other touring acts will be affected in the coming months as live sound returns.

rental receipt
Image: Steve La Cerra/CC-2.0 Enoch Leung

Check out this receipt for a minivan rental. Not a bad price for a week-long rental — except that it shows the cost for one day.

It’s an obscene amount of money, but the alternatives were worse: I could have rented a 5-passenger SUV at a base rate of $1,100 per day and would still have needed a full-size car to carry the rest of the gear that wouldn’t fit in the SUV. When I rented the same minivan for one day in January 2020, the charge was $208 (after taxes). What in the name of capitalism is going on?

It’s a classic issue of supply and demand. People across the country are experiencing what I’ve decided to call PCLL (Post-Covid Lockdown Liberation). They’re sick of staying put and want to travel—anywhere.

For a lot of folks that means jumping in a car (be it their own or a rental) and going. Those who fly to their destinations often need a rental car once they’ve arrived at an airport. Add to that an increase in domestic travel due to travel restrictions to foreign destinations, and it becomes obvious that demand for rental cars in the U.S. is high.

But what about the supply? As the pandemic progressed through 2020, the supply of rental cars diminished drastically. Hertz (which also owns Dollar and Thrifty) declared bankruptcy. Some rental companies furloughed their fleets, while others sold off unused inventory to offset the decline in business. An article in the Seattle Times estimated that roughly a third of all the rental vehicles in service were sold off by major auto rental companies last year. Rental companies figured that these cars weren’t going to be used (they were right) and that they’d simply replace them once the pandemic passed and business returned to normal.

That’s where they were wrong. The pandemic caused delays in automobile manufacturing (see Mix Blog Live: Get That Chip Off Your Shoulder), reducing the number of cars available for prospective buyers—and rental car companies are major buyers of new cars. Auto manufacturers typically sell vehicles to rental companies at a reduced rate, but why should they do so when consumers are willing to pay full price?

For vacationers, this means that plans could hinge upon rental car availability. Most people book plane tickets for a trip, and then book the rental car when they get around to it. If you approach it that way in 2021, you may find yourself traveling by bicycle, which is not a bad idea. But somehow, I don’t see hitching a Radio Flyer to pull your gear.

This is a problem for bands that survive on fly dates. In the case of the recent minivan episode, it’s an increase of more than 400 percent, and a lot of bands need that minivan every week. Ouch. By the end of 2021, the expenditures could be ugly.

The rental car gouge is at its steepest in tourist destinations, but rates are high in secondary and tertiary regions, as well, and many rental car companies simply don’t have any vehicles available in those areas. The minivan that we used last week wasn’t available until a few days before our trip, at which point we canceled the SUV and the full-size passenger car that we had booked to move our gear. Being able to get the minivan relieved a bit of the sting, but not much.

The lowly rental car—once an afterthought—is now center stage for people who do a lot of traveling. Be prepared for the possibility that you may spend more on renting a car than you did for your plane ticket.