Reduced Fleets: Rental Cars vs. Airplanes
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Q. I'm about to take my first business trip to Phoenix and need to rent a car. I'm accustomed to prices for a medium-sized car in the $18-$22 per day range for most of the locations I travel. Needless to say, I was dumbfounded when I looked today and prices were more than double that. Why are prices so high in Phoenix?
A. It's because rental car companies have reduced their fleets and they can charge more for their product. But that brings up the question: why have airlines not been able to jack up fares the same way? the difference is that renters are a captive audience. Consumers can decide to stay home, but once they decide to fly somewhere, unless they want to take the public bus or have a friend who will loan them a car while they're visiting, they have no choice but to rent. The rental car companies have the upper hand. You might want to check out AutoSlash.com, which checks multiple rental car sites, and makes use of promo codes and coupons you might have otherwise missed.
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The tax change ended the sort of Gov't supported industry. Cars had to be held longer and with low turnover the mfrs had to produce fewer cars...note this had been a boost to US Mfrs, not import types. So with less tax break the costs to rent went up, US Mfrs suffered far fewer sales and the great deals of 'lightly used rentals' vaporized. One Tax change... .
One could ask what good came out of it and WHY the former depreciation laws were not reinstated , they could be and the effect presumable positive across the board for all involved !
http://la.indymedia.org/news/2006/11/188489.php
To be fair to the rental companies, the restriction in fleet size is not completely their decision. The major auto makers have restricted the number of vehicles they make available at discount to rental companies. I commented to my regular manager about the rise in average mileage on the rental vehicles and learned that that it has been a real problem for them, with people complaining about paying so much for a car with as much as 60,000 kilometres on it.