Friday, 18 Jan 2019

Is the end close to unexpected car rental surcharges?

When Jeremy Epstein recently rented a Nissan Altima in Hertz, Albuquerque, he could not believe the cost of renting a car. They made the extras demanded by the rest of the travel industry look like amateur work.

They do . But not for long.

Epstein's base rate for weekly rentals was $ 280. Then the car rental company added daily and weekly surcharges, including "$ 25 Government Supplements", a "$ 34 Concession Royalty Recovery", as well as a "Vehicle License Fee" ", A" $ 1 energy supplement "and an installation fee of $ 11. , "A $ 10 motor vehicle rental tax and a $ 45 sales tax.

By the time the dust cleared, Epstein, a researcher from Fairfax, Virginia, had already paid $ 411.

"It's an increase of 46%," he says.

He thinks customers would not tolerate this kind of problem.

"Imagine you go to the grocery store and get a receipt when you check out," he says. "In addition to the cost of food, there is a fee for delivering food to the store, cash register space and a fraction of the cost to keep the refrigerators cold. That's what the car rental companies do.

Good news for motorists like Epstein. The industry is evolving gradually. Hertz communicated the fees when he indicated his initial price (although he did not see it because another person had made the reservation for him). Regulators only require rental companies to report the total cost before buyers finalize the reservation. The car rental companies break down the charges before the final purchase screen as a service to the drivers.

"It also helps to provide transparency to our customers," said Hertz spokeswoman Lauren Luster.

Car rental companies are moving from a business model too often based on deception to a model of total transparency. Progress is slow, sometimes terribly slow, but measurable. This could soon place car rental companies in the enviable position of giving the example to the rest of the travel industry.

The additional costs you see on your bill fall into two general categories: taxes, which are imposed by the city, county or state; and the charges added by the car rental company. Both are a predictable source of customer outrage. Fees are meaningless to drivers and taxes often seem arbitrary.

Consider what happened to William Shallcross, a real estate developer in Altamonte Springs, Florida, when he rented a car in Manchester, New Hampshire, New Hampshire. He made a double take by finding a "tax on meals and rental" on his bill. . Shallcross did not remember any meal service in his vehicle.

"It sounds like a hogwash," he says.

In fact, this is a tax levied on restaurants and hotel rooms in New Hampshire. . . and rental cars. But Shallcross is right: that sounds wrong and it should be part of his rent rather than being a supplement.

According to a survey conducted in 2015 by the National Conference of State Legislatures, more than 40 states were collecting a tax on short-term rental cars. Of the states that tax car rentals, the rates were as high as 11.5 percent in Maryland.

But not all fees are beyond the control of the rental company. Julie Codrington, a computer technician from Gibraltar, Michigan, recently contacted me after she was paid by a "back-processing recovery", "shuttle recovery", and "facility recovery" fee on his bill. "I rented a car online for $ 200," she says. "After all the extra fees and charges, I ended up paying $ 421."

Those are incidental expenses – the type that, in the opinion of industry experts, should be incorporated into the rental price.

Car rental companies and online agencies that negotiate rentals have taken significant steps to solve the problem. When I recently checked the rental rate of a sample, for example, Enterprise immediately offered an all-inclusive price. Hertz offered two rates: a low basic rate, higher than a "total" rate, including the taxes and fees required. Avis cited a low base rate and revealed the total cost of three screens in the reservation.

The information provided by online travel agencies also varied. Expedia indicated a low base rate, but indicated the total cost below, in normal type. Priceline quoted a low basic fee per day, but waited for the second screen to reveal the total cost. which included taxes and fees.

Only a few years ago, most car rental companies and online agencies hid the real costs. Often, a search would result in a "basic" daily fee that can not be booked. Later in the booking process, the company would add fees, eventually leaving you with a fixed price including taxes and mandatory fees. At that time, many customers had already made a reservation decision.

"This type of pricing has no place in the car rental industry," says Chris Brown, editor of Auto Rental News, a trade publication.

It will not be in the future. Newcomers to the industry like Silvercar, which offers completely transparent pricing, have prompted the industry to better disclose its leasing costs. But customers, who are fed up with rental costs that exceed hundreds of dollars more than the daily rates originally quoted, have done even more.

So, why does not everyone have a fixed price? It takes time to go from old to new. Some companies always retain the fee information until a later date in the reservation – a process called "progressive pricing" – for competitive reasons. This makes their rates seem a few dollars lower, attracting travelers who do not pay attention to details.

But this competitive advantage is disappearing quickly. For example, when selling through online agencies, car rental companies can not mislead customers in this way because sites compare fares on a matrix. "You can not fool the womb," says Brown. In other words, companies must abide by the rules of the online agency, which forces them to tell the truth.

This is the takeaway of people who rent a car in this era of transparency. Shop carefully before booking a car. Check out the car rental website and an online travel agency. Call the company to find out if there is a better rate. You can not negotiate taxes and incidentals on your bill, but you can make sure the price you quote – not a penny more – is the price you pay.


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