• Hertz made an offer to buy Dollar/Thrifty for $41/share. Avis subsequently signaled interest in making a higher bid. Bottom line: The car rental market is about to shrink.
• Google is reportedly in talks to buy ITA Software, which provides much of the functionality for sites like Orbitz, Kayak, TripAdvisor Flights, and others. You can’t just google a ticket today, but you may do so soon.

The battle for Dollar/Thrifty between Hertz and Avis is largely about consolidation and elimination of the competition (much like the “Continited” merger). At the same time, buying Dollar/Thrifty would give Hertz or Avis a larger presence in the comparatively “downmarket” leisure travel segment.

The speculated deal for ITA Software is perhaps more interesting. What will Google do if it gains the technology and software engineering human resources to run better fare searches? Will they offer a search-of-searches, pushing traffic to airlines and online travel agencies, but putting Kayak and their metasearch ilk out of business? Will Google challenge Expedia, Orbitz, Travelocity, et al. themselves and build a Google travel agency? Will Google continue to sell the powerful ITA engine (which ITA lets anyone test drive on their beta site — login as guest) or will they let contracts expire and keep the technology for itself? Plenty of theories, but no answers.

So in the past week, the competitive landscapes for flying, driving, and booking travel have all potentially changed, with minimal visible benefits to the consumer. After all, less competition breeds higher prices.

All we’re missing is a hotel deal and a cruise line merger, and we’ll be all set. (The week is young.)

As noted last week, I rented a car in San Francisco from AutoEurope after finding significantly lower rates with them than through the normal US channels. The process worked, but the pickup wasn’t a breeze. The voucher wasn’t the issue. The rate wasn’t a problem. But it was the worst car rental experience I’ve had, bar none, because of the interminable wait for both counter service and a car. (And that includes the hours I spent waiting at a Budget counter at midnight at LAX back in 2005.)

One item of background: When you rent with AutoEurope, it’s much like booking with Hotwire or Priceline. You get the rate quote, including taxes, up front. You prepay. And you don’t know who the provider is until you purchase. BUT: You know the exact address of the rental location (which, thanks to Google, lets you figure out who the company is) and it’s refundable up to 48 hours in advance. As theothersimon said in comments, book away, then cancel if you don’t like what you get. Better than the other opaque providers, if you ask me. My reservation came up with Dollar, which has never been my preferred provider, but the price was right. Alas.

Commenters on the original post pointed out the potential pitfalls of this rental. They nailed it. So credit where it’s due: the readers of this site, for calling it before it happened.

To wit:

JeffB noted that reservations on Expedia’s UK site contained the provision that the renter of a vehicle would be required to purchase one tank of fuel at the rental agency’s rate. My rental was with AutoEurope, but this was indeed the case: The voucher that I printed contained a similar provision, requiring the prepurchase of a full tank of gas, within the fine print. And the rate for gasoline was about 15 cents higher per gallon than filling it up yourself at the closest gas station.

As JeffB noted, base-rate savings may not pan out if you only rent for a single day, or for short trips, if you have to pay for a tank of gas. In my case, it was still a good deal, despite the fuel premium. We burned through an entire tank, and then some, during the trip, for over 650 miles. The indicator in the dashboard warned that there were only 5 miles’ worth of fuel in the tank when we returned it. I overpaid less than $3 for gas, but came out ahead since we saved nearly $200 on the rental itself. Hyahh!

So fuel wasn’t a big deal. A bigger issue for us was time. Chris noted that the downtown pickup locations in San Francisco were overwhelmed with customers. We experienced the same thing. It took two hours and twenty minutes to get a car.

As mentioned, our voucher was for Dollar, at the O’Farrell St. location. I met up with my wife, who was already in San Francisco for several days, on Tuesday night, and we were heading up the coast on Wednesday. Luckily, we weren’t renting with National: Their location a few doors down had people lined up out the door. Between National, Alamo, Thrifty, and Dollar, all on the same block, it was a mess. (Primarily with travelers from Europe, most with vouchers in hand, I might add…)

The central problem was car availability. The cause: Dollar’s willingness to accept reservations for times when they consistently had no cars available. To be clear: This has nothing to do with the booking channel — direct with Dollar, via AutoEurope, or elsewhere — and everything with the way Dollar does business.

As the front-desk agent and the location manager explained to me, downtown rentals in San Francisco (and presumably in other downtown locations) are hardest to get when they’re close to hotel checkout time. Travelers want to check out and grab a car ASAP — or grab a car just before checkout and then swing around to load the trunk.

If you thought you might try your luck renting that car first thing in the morning, before the hotel guests wake up, you’re out of luck: Rental companies like Dollar don’t have the inventory then. They’re bringing cars into downtown locations from the airport lots. But that depends on travelers dropping the cars off at the airport first… and how many cars are being dropped off at 7 am?

I admit I’ve typically rented at airports or in less-touristy downtown locations, so this feels like a rookie mistake to me. For example, via e-mail, reader Mark suggests:

Regarding SFO car rentals, I just came from there. The trick is to take a short cab ride to San Bruno (about $12-15) and go to the Avis location at the Tanforan mall, I think it’s called. A lot cheaper and easier than going downtown. Plus, they upgraded my car free and gave my fiance and me second driver for free, too. It was a great experience.

Bottom line: Even after reaching the front of the seemingly interminable line, there was no car available without waiting some more. And when it finally seemed that I had a car, their primitive walkie-talkie car assignment system led to a double-booking of the same vehicle. Another customer drove off in “my” car, literally seconds earlier. I felt like Seinfeld. (“You know how to take the reservation, you don’t know how to HOLD the reservation.”)

The manager of the facility indicated that this was a problem with the Dollar/Thrifty corporate reservation system, which allowed cars to be reserved at hours when it was obvious there would be no cars. Such as noon on a Wednesday.

The lesson, verified by the Dollar agents: If you’re picking up a car in a downtown location near big hotels, plan on picking up after 1:30pm, when hotel checkout is over.

It worked out in the end, eventually — upgraded to a higher class (far more comfortable, albeit with higher gas guzzlage).

So, I learned some lessons here. Don’t rent in urban American downtown locations near major hotels until after checkout time. Give preference to off-airport sites with fewer big hotels nearby. Be aware of fuel fees for vouchered reservations. And don’t trust Dollar Rent-a-Car to actually hold a reservation at a time you’ve specified.

“While we were pleased with some aspects of the pilot program that we implemented in April 2008 at our Houston location, we have concluded that the use of kiosks in the customer service experience reduced our interaction with the customer, detracting from the high level of personal service that our customers have come to expect from us. Additionally, the pilot project did not satisfy our minimum return on invested capital, thus we concluded that continued full-scale development of self-service kiosk was not in our shareholders’ best interest,” said Scott L. Thompson, President and Chief Executive Officer.

Hmm. There are two arguments there. 1) Kiosks hurt the customer experience. 2) Kiosks cost too much.

I am skeptical about #1. Unless the person behind the counter refuses to handle any requests and insists on sending all customers to the kiosk, there’s no reason why kiosks wouldn’t supplement the rental experience. Frequent travelers are comfortable using a kiosk, after all.

The cost issue is plausible. Especially in the current credit environment. Machines aren’t cheap, after all.

But here’s another possible financial reason which they’re not fleshing out: It’s easier for a customer to avoid an upsell when they’re interacting with a kiosk, than when they’re dealing with a person. So the kiosk might cause the company to lose out on revenue.

The person behind the counter can try to scare or convince an easily manipulable customer into spending more of their money. A kiosk is less convincing.

My own experience with car-rental kiosks (albeit not with Dollar or Thrifty) has been pleasant, quick, and efficient. The effort to upsell is minimal, and it’s easy to decline coverages without any hassle. Maybe that’s the problem.

Related:
- In defense of kiosks
- Five ways to get an edge over other air travelers
- Alamo and National speed up rental car checkout

Rental car add-on fees are already out of hand. But leave it to a Dollar Rent A Car franchisee in New Hampshire to kick it up a notch:

Some rental car locations are charging an extra fee to consumers who return their cars with a full tank. This “top-off fee” is being charged even if consumers present evidence they have that the tank is full.

Wow. Just… wow. Charging extra for a full tank??! Every time you think they’ve tapped out the possibilities for new fees, they come up with a new one.

And it was in the fine print of the e-mail confirmation that was e-mailed to the customer:

“Gasoline Policy: Vehicle must be returned with full tank or local refueling charge applies. If car is returned full a $2.00 top off fee will be applied.”

Topping off what, exactly? It’s full!

This isn’t a standard policy across any and all Dollar locations. Rather, “the fee was being test-marketed by Dollar at select locations in New England.” Well, great, then.

Note to Dollar Rent-a-Car: Customers don’t care if it’s a franchisee or a corporate-owned site. They just care that they’re getting screwed. If it’s the Dollar name on the door, customers will blame you.

If you want to charge a higher rate, fine, but don’t BS the customer with charges for fuel they aren’t using.

Related:
- Low mileage, high surcharges
- Car rental companies find new and innovative ways to screw good drivers
- Car rental companies hate New Yorkers — unless they live in Manhattan or Staten Island
- Wanted: Kinder, gentler gouging?
- Reader mail: What happened to car rental late-return grace periods?
- Rental car agent blows smoke up my backside, redux

(via Consumerist)
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Two readers wrote in regarding late returns and grace periods when renting a car. Reader Francine writes:

When I rented a car from National recently, there was no grace period for late returns. None! Is this the latest way they get you?

And reader Peter offers this story, and advice, from his recent rental with Budget Rent-a-Car in Montreal:

I was late getting out of Vermont and late getting the car back to the airport. When I arrived I discovered that I had signed a contract that stipulated $33.xx CAD/hour for being late on a $55/day rental. Further, since I was 2hrs 15 minutes late they claimed I was 3 hours late (the grace period disappeared) and they charged me for another DAY, stating it would cost me less than 3 hours of the late charge.

I haven’t had any luck getting Budget to discuss this with me. If you rent from anyone be clear at pickup 1) what constitutes late and 2) what it costs when you are.

Indeed, grace periods are no longer a given when it comes to late returns. Hertz cut their grace period in half a year ago, and others soon followed suit. Nowadays, you really need to know what you’re signing (and initialing).

In Peter’s case, I see only one possible “violation” here on the part of the company: The forfeit of the grace period. But even then, if he returned the car two hours late (instead of three), he’s better off paying a full day extra, rather than two hours’ overtime. It sucks, but those are the terms.

With contracts like this, if you signed for it, you’re on the hook. These hourly rates are one of the items you’re often asked to initial.

Not all companies are the same, though: Late-return policies vary by chain, with some chains offering no grace periods whatsoever.

Perhaps even more importantly, some companies reserve the right to retroactively change your rate to a higher level — for the duration of the entire rental — if you return the car late. If anything, Peter was lucky they didn’t change his rate for the earlier days as well!

The policies of each major U.S. chain, with key points highlighted, after the jump:

• Alamo: “A grace period of 30 minutes applies to rentals within the U.S. Within the European Union, there is a 59-minute grace period, thereafter a further full day’s rental will be charged.” Even worse: “Daily/weekly rates may also retroactively increase from the start of the rental if the vehicle is kept beyond the agreed return date and time.”

• Avis: “There is a 29-minute grace period. If the car is returned within the 29-minute grace period there will not be any additional hourly rate. Beyond the 29-minute period, an hourly rate will apply until it equals the rate for an additional day. Charges for optional services such as LDW, etc. are charged as full days after the 29-minute grace period. If a vehicle is returned beyond the parameter associated with a specific rate code the rental may revert to a higher applicable rate.”

• Budget: “Vehicles are rented on a daily, 24-hour basis beginning at your pick-up time. There’s a 59-minute grace period for returns. After one hour late, hourly charges may apply. After three hours late, a full-day charge may apply.”

• Dollar: No grace period. “The renter will be charged for each hour and/or any part of an hour in excess of a rental day the renter keeps the vehicle until the vehicle is returned, up to the applicable daily rate. … Other rates will apply if the Vehicle is returned earlier than the original return date or if the Vehicle is returned later than the original return date.”

• Enterprise: No grace period. “For most rentals, Enterprise uses a 24-hour period to define a single rental day. For example, if you rent a vehicle at 11 a.m. on Monday and return it any time prior to 11 a.m. on Tuesday, you will be billed for one day. If you return the vehicle after 11 a.m. on Tuesday, you will be charged an hourly rate for each additional hour, or for a second full day, whichever is less. Hourly rates are usually one-fourth of the daily rate.”

• Hertz: “Vehicles are due back the same time of day as rented, Hertz will provide a 30 minute late grace period at no additional charge. Vehicles returned after the 30 minute grace period will be subject to an additional hour charge and/or an additional day charge.”

• National: No grace period. “Rates are subject to change if vehicle is not returned on the date and time agreed upon at time of reservation and rental.”

International chains, or rentals with these companies at locations outside the U.S., will have different terms. (Kudos to Alamo for pointing out the difference up front.)

Be particularly careful when returning late to Alamo, Avis, Dollar, and National, as they can jack up the rate for the whole rental. Nasty.

When you’re booking, make sure you open the terms and conditions, and do a search for terms like “grace” or “late” inside the webpage. That will often point you toward the policy governing your rental. When in doubt, ask questions.

You may be able to negotiate some of these points (especially with Enterprise) but don’t count on it.

Know the terms of your rental, ideally at the time of booking, and certainly before you drive off the lot.

Related:
- More changes to car rental terms and conditions
- Low mileage, high surcharges
- Car rental rates at Enterprise are negotiable
- The death of the grace period? Or just the last time I ever rent from Dollar Rent a Car?

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Well, it happened to me again. The scene of the crime: Dollar Rent-a-Car. San Antonio Airport. March 14.:

Agent: I see you’ve reserved a compact. We’ve got a 2-door Suzuki Forenza.

me: That’s fine, thanks.

Agent: The Forenza doesn’t have power windows, power locks, or power steering. For only $45 more for the duration of the rental, we can put you into a nice new Nissan Sentra, that’s a midsize.

me: (incredulously) The Forenza doesn’t have power steering?!!?

Agent: No, it doesn’t. We buy them with no options for $8000, that’s how we can rent them out so cheap.

me: (skeptically) But no power steering?? I’ll still take the compact, thanks.

Agent: You’re sure? It’s not much more for the Sentra!

me: I’m sure.

[type type type]

Fact Check, upon returning home:

1) The Suzuki Forenza doesn’t come in a 2-door.
2) All Suzuki Forenzas (sedans and wagons) come with power steering.

Here, have a review.

Back to the bamboozlement!

Agent: We recommend that everyone take our Loss Damage Waiver [I started tuning out for a bit here]… and we charge for loss of use, which your insurance doesn’t cover.

me: I know all about loss of use. I’m covered. I’m declining all coverage.

I love how the agent knows all about my personal auto insurance and the coverage provided by my Visa card. Nice.

After more typing, and some harrumphing by the agent, I get the contract, get on the shuttle bus, and get dropped off at my car…

A 2007 Nissan Sentra.

I looked around the lot, and how many Suzuki Forenzas — especially the mythical 2-door model without power steering — did I see? None.

On a previous post, commenter Jason wrote about attempts like this to upsell the customer when a free upgrade was pending. Jason said such practices were a fire-able offense at Alamo/National. Apparently not the case at Dollar…

In the end, I was fine receiving this upgrade, since it’s a decent ride with solid fuel economy. It’s not like they gave me a minivan.

But the outright lies that were told to me at the desk were atrocious.

Related:
- Reader mail: Why would I want to upgrade my rental car?
- Loss of use? Get lost.

Following the revelation earlier this week that Hertz and Dollar have surcharges for residents of these three boroughs of New York City (but not Manhattan or Staten Island), I decided to write to Dollar and Hertz and ask why some New Yorkers were worthy of higher rates than others.

Within a few hours, Donna from Dollar Rent-a-Car replied:

Unfortunately this is the locations policy. According to the location, rentals from people in these areas who have rented from Dollar have proven to be more of a liability.

Hmm. Well, at least Donna wrote back quickly. Still no reason why New Yorkers renting at a location in another state (e.g., in Philadelphia) get smacked with surcharges.

How about Hertz? 36 hours after the original inquiry, Rhonda wrote back:

Hertz does apply residence based rates for residents of New York City renting locally, that take into account the extraordinarily high liability costs associated with local rentals in the New York area. These rates are based on borough of residence. The same residence-based rates apply equally to all residents of a borough. The residence-based rates are not applied on the basis of race, ethnic origins, age or sex. Rather, they are based on historic liability costs associated with local rentals to residents of New York City boroughs.

“Extraordinarily high liability costs” ? Personal liability, as in running people over, or loss of the car? And if liability is higher, then isn’t that what insurance is for, instead of raising the base rate?

I once rented from Advantage Rent-a-Car in Seattle, and they demanded a copy of my insurance policy before they would let me waive their CDW, LDW, etc. I had to call USAA and have them fax a copy over. As obnoxious as that was, perhaps Hertz and Dollar should demand proof of insurance before they slap $55 a DAY in surcharges on the base rate!

New Yorkers, you’ve been warned!

The Consumerist points to a nasty punitive provision in the Dollar Rent-a-Car rental agreement.

1.O Higher rental rates for New York City (Brooklyn, Bronx, and Queens) resident renting in New York, Newark, NJ and Philadelphia may apply as follows:

* For Brooklyn residents the rates will be $55.00 higher per day.
* For Bronx residents the rates will be $53.00 higher per day.
* For Queens residents the rates will be $11.00 higher per day.

I’ve heard of rental rates varying depending on the country of the renter’s residence (obnoxious enough in its own right, frankly). But varying by city borough?? (Manhattan and Staten Island residents are in luck, no surcharge And $55 per day surcharge for Brooklynites?!!?) This sounds a heck of a lot like redlining.

But the shocker, for me at least, is that Dollar isn’t alone. Similar policies, with different surcharge rates, exist at Hertz for NYC rentals:

Higher rental rates for New York City residents may apply as
follows:

- for Queens residents rates are USD 15.00 per day higher
- for Bronx residents rates are USD 56.00 per day higher
- for Brooklyn residents rates are USD 34.00 per day higher

Hertz and Dollar must be run by Mets fans.

I couldn’t find outer-borough surcharges on Budget or Avis. Anyone out there know of other redlining car rentals?

Dollar already alienated me with their no-grace-period policy. That, plus the New Yorker Tax, suggest that they won’t be satisfied until everyone in America is offended.

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I also previously discussed the reduction in the grace period from 59 minutes to 30 minutes at Hertz.

But yesterday, when I picked up a car from Dollar Rent a Car at Salt Lake City Airport, I was treated to two conditions in the contract that I’d never seen from a major rental agency at an airport:

- No grace period at all. None. Pick up the car at 12 noon, return it a week later at 12:10? Pay an extra hour.

- No taking the car out of state. I’ve seen this at Enterprise Rent-a-Car for insurance rentals, but at an airport? From a major agency that deals with tourists, businesspeople, etc.?

Dollar seems to be actively trying to alienate its customers. Is this a case of incompetence or malice?…