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Renting a car will be a pain until at least 2022 (sorry, travelers)

Hugo Martín, Los Angeles Times on

Published in Automotive News

"The increase in demand around rental cars is something we've been seeing all summer, and Kayak's data is showing that demand isn't going to slow any time soon, especially as we enter the holiday season," he said.

The problems for the car rental industry began when the pandemic forced the closure of factories around the world, interrupting the production of microchips needed for electronic devices, laptops and cars. The pandemic also closed down ports in Asia, which disrupted the microchip supply chain. Automobile manufacturers canceled chip orders, assuming demand for new cars would dry up during the pandemic.

But once demand for vehicles and electronic devices for homebound workers bounced back, chip manufacturers struggled to keep up with the new orders. Japanese carmaker Nissan said it is planning to make 500,000 fewer vehicles in 2021 because of the chip shortage. Other auto manufacturers, such as General Motors, have been making vehicles and storing them by the thousands in giant parking lots, waiting for the microchips they need to operate.

Because of the shortage, the U.S. car rental industry was able to purchase only about 800,000 new cars in 2020 to restock its aging fleet, less than half of what the industry bought in 2019, Scott said.

Microchip manufacturers say it may be a year or two before supplies can start to meet the growing demand. That means the shortage of cars won't ease until 2022 or later, industry experts say.

"It continues to be a lot of uncertainty," Will Withington, senior vice president at Enterprise Holdings Inc., said at a recent rental car industry convention in Las Vegas.

In a statement, Enterprise said the company is able to meet current customer demand by extending the "normal cycle of our fleet" with rigorous safety and maintenance standards.

Industry rival Hertz Corp. said it is "working closely with our automotive partners to add new vehicles to our fleet as quickly as possible, purchasing low-mileage, pre-owned vehicles, and moving vehicles to the areas with highest demand."

 

Such assurances are little comfort for Kimmy Katz of Titusville, Fla., who described her recent car-renting experience as "very frustrating."

She rented a Nissan SUV for a two-week business trip in Florida from Dollar Rent a Car. But one of the tires had a slow leak that required her to fill it every two days, Katz said. When the tire finally went flat, she said, the car rental agency denied her request for a new car or a new tire.

I "am thanking whatever god or science is out there that I did not break down on I-75 or I-10 where there is no cell service," she said.

Asked to respond to the problems cited by Jimenez and Katz, Hertz, the parent company of Dollar, said the company "would need to look into those specific situations to be able to comment further."

"When customers raise a concern, we look into it and try to make it right," Hertz said.

Industry experts say travelers who want to avoid such headaches should book cars as early as possible and try to choose car rental outlets in small or midsize airports where demand is lower.

"I've never seen anything like this," said Eben Peck, executive vice president for advocacy at the American Society of Travel Advisors. "COVID has put so many stresses on the system, and this is just one of them."

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