I was on vacation for two weeks. Four flights. Four airports. Three countries. With two well-meaning but slightly logistically challenged and permanently hungry teenagers.
It could have been a shock – I admit I spent a sleepless night before departure. But that was not the case.
No flight was delayed for more than a few minutes. There were no real queues for security. Waits at passport control were short and simple. And the journey between the two was generally straightforward – largely because we took lots of taxis.
Couldn’t find a hire car at Newquay airport. Not at any cost, or anywhere near. In Rome I was quoted something in the region of £700 for four days hire everywhere I looked, as I was for a similar request in Naples a month ago. Only in Copenhagen were the car rental prices even vaguely similar to the old ones.
This all freaked me out a bit at first. I am used to traveling independently. Now I see the error of my ways.
In Newquay we were picked up at arrivals by a pre-booked taxi. Later in the week the same company drove us to the Cornish town of Helston and back the following day. They then took us to Bristol to catch our flight to Rome at the weekend. Another nice driver picked us up from the airport there and took us to our destination (wish he hadn’t missed the stop sign and gone straight through four lanes of traffic , but we’re all alive, so I’m not kidding). Then we took a lovely train journey back to the airport a few days later.
The total cost of all those taxis was more or less the same as renting a car three years ago, and very much cheaper than renting a car today. It also seems like a better use of resources, as most rental cars spend their time parking outside villas and hotels.
But the key thing to note is that being picked up on arrival by a man with a sign and not having to remember which side of the road you’re supposed to be driving on for the next five days is really relaxing.
How much relaxation became evident when we arrived in Copenhagen and set out to find the rental car we had booked with Sixt. I had booked the “fast track” service – but having received no information on how it worked, we followed the signs for rental cars. It meant a “courtesy” bus (the joke is in the name). And then that meant a queue.
There were a lot of people waiting at the Sixt counter. There was no one available to answer questions without breaking into the queue and there was no obvious fast lane.
We were number 652. They were at 647. The strangest scene of the trip ensued, and many of you will have marveled before. People who had filled out all the necessary forms online and prepaid were asked for all those details again by someone who obviously never took a typing course and then sold a few things they didn’t need before being given the keys to a different type of car than the one they ordered.
Think of a minimum of 10 minutes per perplexed customer. When they got to us it turned out the fast lane was elsewhere (back to the terminal) but that detail was irrelevant in the grand scheme of things as investigations revealed that the car we would have must have been “lost”. Lost? Yes. Lost.
When we asked Sixt to respond, we were told that the reservation information was missing and that the car change was an upgrade. But he said he “sincerely apologizes . . . for any inconvenience caused”.
Like me, you will know that none of this is necessary. Enough car rental companies have systems that work for us to know that technology is a breeze. Avis Preferred gets you straight to your car, just like Hertz Gold. You can check in online and collect your keys in less than a minute. This is apparently something you can also do with Sixt fast track.
Some agencies leave the keys in the car with you, an increasingly common option in the United States, where you can often take any car and scan it as you exit the parking lot; and some have systems that allow you to unlock them with your phone.
So if it’s perfectly simple to do all of this, why aren’t all car rental companies upgrading their systems to do it? The obvious answer is upselling, but that’s not quite enough. You have to pay people to upsell and every step of the way makes your customer hate you.
Beyond that, the only answer I can find is that so far they haven’t really had to. Historically, large car rental companies have been as much automotive dealers as automotive suppliers. They bought a large number of cars from the big manufacturers at very low prices – and after a year or two of torturing consumers with said cars, resold them on the market at market price.
You don’t necessarily make money this way, but you cover a huge amount of costs – and then you can provide your rental service so cheaply that your customers tend to smile and put up with it, whatever its miseries. .
Things are different now. Builders have long been keen to reduce their reliance on low-margin fleet sales, says Julie Boote of Pelham Smithers Associates, because it’s bad for profits and bad for their reputation.
With supply chain disruptions still ongoing, mostly due to microchip shortages, they can. The cars they make can be sold directly to retail customers on huge margins – margins that rental companies, which have sold off their fleets massively during the pandemic, also have to pay a portion.
It won’t stop any time soon: Toyota has an order book of around 2 million vehicles, for example, says Boote. Even with the recession, the old days of “buy low, sell high” are not returning for rental agencies. This means passing on high prices, expecting low customer tolerance (we’ll put up with a lot to get a car for a week for £150, rather less if the price is £800) and facing stiff competition from companies taxis in Europe less.
All of these things will surely lead them to upgrade systems across the board and in doing so, reduce costs in the long run. Crossed fingers. But while they figure out that one, you’ll find me heading to the pre-booked taxi section at departures. It turns out that not having a rental car can be a lot easier than having a rental car.
Merryn Somerset Webb is editor of Money Week. The opinions expressed are personal. [email protected]
PS I’ll be at the Edinburgh Fringe August 25-28, so if you want to talk about investing, economics, politics or car hire, join me at “The Butcher, the Brewer, the Baker and Merryn Somerset Webb “. All proceeds go to maintaining Panmure House, Adam Smith’s last home.