Rates overtaken by service needs

Rates overtaken by service needs

RENTAL rates to the US have fallen by up to £10 a week this year as car companies strive to boost their share of outbound business from the UK in the face of new competition and a shrinking leisure market.

The US has long been one of the most fiercely fought-over car-rental destinations, particularly Orlando and California, but this year the pressure in the retail sector has been heightened by several factors.

They include Hertz's new campaign to increase its share of the leisure market and an overall drop in package holiday bookings to the US.

"The US market is very aggressive this year," said Suncars general manager John Briggs.

"The problem is that there are so many companies chasing what this year is a shrinking package market.

"Our business to the US is up about 30%, but the biggest chunk is from people who are booking independently. The high street is losing out because people are confident about going to the US and are more inclined to package their own holiday."

Holiday Autos managing director UK and Ireland Tony Seaman said business is still growing, but it is very price-sensitive.

"Rates are £5-£10 lower than last year for a small car," he added. "That's a good message for agents to pass on to clients."

Hertz claims to be the biggest car rental company in the States, but Dollar is widely cited as the largest in terms of outbound business from the UK due to its links with Virgin Holidays, Airtours, Thomson and First Choice. Alamo and Holiday Autos are also major players.

In terms of price and product, there is little to differentiate the companies. Apart from Budget, they all quote similar rates (see box) and as well as the all-inclusive price, which covers all necessary insurances and airport and state taxes, most also have an upgraded product.

These upgraded programmes, introduced over the past two years, add a free tank of petrol and a number of additional drivers to the all-inclusive package.

As the product is so similar, many operators are looking to compete on service. "There is only so far you can go with price and it is not difficult to transfer benefits for business travellers to the leisure market," said Hertz divisional vice-president, leisure sales, Bill Jones.

Most Hertz US leisure clients are met by agents with hand-held billing devices when they return the car and 50,000 new Neverlost satellite navigation systems are being acquired this year for the US fleet to make them more widely available for holidaymakers.

Alamo offers pre-rental registration which allows clients to complete their details in advance for faster collection and the company is also investing millions of dollars in new facilities at locations for leisure renters (see news panel).

USrental rates

Based on weekly rental costs for a two-door Economy car in Florida for period to include July 31:

Suncars: £165 fully inclusive, £175 Gold option.

Dollar: £165 fully inclusive, £175 Platinum option.

Alamo: £174 fully inclusive, £184 Gold option.

Holiday Autos: £165 fully inclusive, £175 The Max option.

Hertz: £159 Choice 1, £169 Choice 2.

Budget: £205.64 fully inclusive.

Avis: £169 fully inclusive.

Based on weekly rental costs for two-door Economy car in California for period to include July 31:

Suncars: £165 fully inclusive, £175 Gold option.

Dollar: £185 fully inclusive, £195 Platinum option.

Alamo: £174 fully inclusive, £184 Gold option.

Holiday Autos: £165 fully inclusive, £175 The Max option.

Hertz: £171 Choice 1, £181 Choice 2.

Budget: £308.51 fully inclusive.

Avis: £171 fully inclusive.

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