BTW, your calculation agrees with my statement. $37 for car including fees, $30-$40 in gas, plus unknown parking. I was spitballing $60-$70 for day, and it seems those things do indeed add up to that amount. Higher gas prices, more expensive parking, and longer commutes make those figures even moreso.
I agree with you that if the business foots the tab, the employee might not care and would just go for convenience. But the biggest factor impacting business travel is not the cost of rental cars, but the shift to virtual events and remote meetings. This is another indelible force for the rental industry.
As mentioned, I think the demise is not in these next few years, but by 2030 I believe we'll be writing the post-mortem on rental cars and how the industry has transitioned to something else.
Uber pricing and convenience make me think harder about the equation. If I'm really pretty much just going to a hotel for a few days, it's probably a wash so I may just take the Uber.
I'll still rent if I'm going to also be visiting friends or going for a hike--or taking a longer drive to somewhere that I may not even have cell reception. But definitely less than I used to even pre-COVID. And I imagine that urbanites who default to not driving rent even less.
Playing around with variations on a 7/13-7/17 M-F rental (also trying 7/11-7/18 Sat-Sat, checking in Manhattan, at LGA, and at DSM in Des Moine, IA for comparison) I'm seeing numbers 1.5-3x higher. I'm curious if the difference is entirely price discrimination or if there is something else like a negotiated bulk rate at play.
Numbers are for lowest tier car, same pickup and drop off location.
Manhattan M-F: $72/day base ($348 w/ taxes and fees)
Manhattan Sat-Sat: $59/day base ($501 all in)
LaGuardia Airport (luxury car, economy car is $22/day more) M-F: $94/day base ($512)
LGA Sat-Sat: $73/day base ($693 total)
Des Moines International Airport (standard car, economy car is $6/day more) M-F: $92/day base, $472 total
Des Moines International Airport Sat-Sat: $49/day base ($463 all-in)
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So...
1. Lowest I'm seeing is $49/day, which is why I ask in the first place.
2. Pricing shenanigans of a Saturday to Saturday rental coming out cheaper than a Monday to Friday rental in the case of a) 7 day Manhattan vs 5 day LGA and b) 7 day DSM vs 5 day DSM are so frustrating. Surely there's room in the economy for a competitor who offers transparent, predictable pricing? Dealing with industries where you know they are milking you based on reverse IP look up/browsing history/demographic profile is infuriating. How can someone be loyal to any company whose pricing model is "the absolute most we think we can get out of you, personally"?
Yes. But I believe I get the same prices on my personal account.
> I don't see anything about discounts in the Emerald Club benefits section.
This may be why. I'm Emerald Executive -- my employer has negotiated Executive tier for every employee. I also have the same tier on my personal account through my credit card.
I don't rent cars in NYC (that's one place where rentals are inadvisable -- NYC is hostile to driving). But just priced out DSM for you 7/11 - 7/17. For Economy and Compact = $152/week base, $219 total with fess included. Midsize = $157/week base, $226 total with fees included.
(Someone else with Executive membership but without a company negotiated rate, please verify.)
With Executive level membership, I can get a midsize and pick any vehicle from the Executive aisle. This can be anything from an SUV to a lower-end luxury car. This is why National is amazing.
> How can someone be loyal to any company whose pricing model is "the absolute most we think we can get out of you, personally"?
It's differential pricing as a result of yield management [1]. You can hate on it but it's part of the reason the economics even works for certain classes of goods and services. Without it, large swaths of services in the hospitality industry (hotels, airlines, etc.) would not be accessible to the masses or be profitable.
Thanks for taking the time to look this up. $226 vs $472 is wild. 2.1x the price for the same service.
Playing around with other car companies at DSM for 7/11-7/18:
- Budget: $347 all-in
- Avis $410 all-in
- Hertz $484 all-in
- Enterprise $374 all-in
I was expecting all of these prices to be pretty similar given "economy class rental car" feels like it would be fairly commoditized.
> It's differential pricing as a result of yield management [1]. You can hate on it but it's part of the reason the economics even works for certain classes of goods and services.
Being familiar with the concept doesn't make it more enjoyable to be the one being fleeced!
So there's one big factor that plays into all of this: for business travel, the company's paying. Employees don't really bear the cost, so the incentive is to choose the more convenient option. Parking etc. can all be expensed (not a big deal with Spothero, etc.). And companies usually have negotiated rates with rental car companies. So there's inertia.
I just checked my National invoice for my last LAX rental: the nominal daily rate for was $31/day, but with airport concession fees, tax, etc. it came out to $37/day (the car was a 2019 Dodge Challenger). I don't remember how much I paid for gas but gas is pretty cheap these days so it couldn't have been more than $40 (200 miles driven). So yes daily rate is higher, but not really double.
Would I pay $100-$200 for unlimited trips on rideshare? Not for business travel, no because like I said, for the non-urban geographies I work in, a rental car is just more convenient and the company's paying (plus my time costs money).
For personal trips? Well, Lyft does have a subscription program for commuters but I'm probably not the target demographic (I have my own car for groceries, but otherwise I walk everywhere or take the L). I also have a free Lyft Pink subscription through my credit card but that hasn't really increased my Lyft use.
I suspect during COVID the attractiveness of rideshare will actually decline -- I'm personally wary of getting into a confined space with someone else even with every precaution taken. But post-COVID, it's likely things will return to normal. Rideshare has been and will likely continue to be an important component of my urban transport mix. I just don't see it being dominant over all others.