Advertisement

The hell of airport car hire, and how to make it better

Most people’s experience of airport car-hire isn’t a pleasant one, with long waits, hidden charges and a curious habit of not giving you the car you ordered. It needn’t be that bad, says Merryn Somerset Webb.

180809-car-hire
Airport car hire is the worst

Cars I have rented in the past six months: a Fiat Panda (France); a Volvo XC40 (Italy); a Renault Megane (France); and a nondescript, too-small piece of nothingness, the brand of which I have forgotten (Ireland).

None remotely resembled the car I ordered. The Panda was a straight downgrade ("There isn't anything else, do you want it or not?") with no refund offered. The Volvo was an unwanted upgrade. Reader tip: the only car suitable for the tiny, twisty roads on the Amalfi coast is an already bashed-up Panda which is why the Volvo was on offer ("There isn't anything else").

Advertisement - Article continues below

The Irish nondescript was too small for five people and their luggage. And the Megane, being user-unfriendly, ugly and in this case bizarrely fuel-inefficient, doesn't resemble any car anyone would ever order anywhere for any reason whatsoever.

I haven't complained about any of this. Why? You've hired cars; you'll know the answer. I didn't moan at the time because I couldn't cope with either extending my wait or nudging the person behind me to violence by extending their wait. I didn't afterwards for the reason that on each occasion I escaped post drop-off without being charged much extra for damage, dirt, late returns, missing fuel or the simple idiocy of being a customer.

The car hire sector is broken

You will know all these feelings. This summer, readers have told me of waiting for up to two hours for hire cars. You will probably also be wondering what it is that makes the car-hire sector both so hideous and so seemingly immune to disruption. After all, if you can stick your passport in a machine at an airport and get a booked boarding pass for a plane to anywhere, any time, why can't you stick it in one at the other end, pick up a booked set of keys for a car and drive off anywhere, any time?

Advertisement - Article continues below
Advertisement
Advertisement - Article continues below

The answer clearly isn't about technology. Outside airports, the car-hire sector is well on the way to being disrupted. Car clubs are great. Zipcar claims that half of London is within a five-minute walk of one of its cars. Unlock the car with an app and you find the keys in the glovebox. No humans, no desks, none of that odd paper with holes in the sides, and no queues.

Peer-to-peer is gaining traction, too: use this and you get the exact car you ordered (as opposed to Hertz-world where "similar model" could mean anything). You can pick up almost anywhere and in some cases arrange for the car to be delivered to you. Try Turo, Drivy or Hiyacar. All sound fine which in large part explains the fall in Hertz's share price from $120 to $15 in four years.

So why are airports a special case? Money. It is expensive to rent a desk at arrivals and to have parking spaces near enough to keep customers happy. But competition, driven in part by comparison sites, has made renting cars cheap.

Advertisement - Article continues below

Think about hiring a dinner suit from Moss Bros, says one old hand in the sector. The whole caboodle (jacket, shirt, trousers and tie) costs £142 a night for a mid-range deal. To buy the lot would cost £500. So each rental brings in nearly 30% of the capital cost. Rent a Nissan Qashqai and the price will be about £20 a day for something that costs £20,000.

Advertisement
Advertisement - Article continues below

Sure, you can rent it out more often than a jacket that everyone takes to a sweaty wedding, and sure, the resale value is going to be more but on the downside it's going to be driven fast and badly (remember the joke about the best off-road vehicle being a rentacar?). There will be endless no shows, late flights, late returns and carsick kids. And no one is going to tell you about the non-visible damage they have done to your £20,000 piece of kit. Clearly £20 is not enough.

Advertisement - Article continues below

Car-hire agencies are caught in a bind. Clients demand transparent prices and low prices. If agencies offered the former it would quickly be clear they couldn't offer the latter. So, on the current model at least, they have to fudge it with low headline prices and overzealous post-hire charges (the fuel and the bonkers fees for minor damage) and relentless upselling.

Such threaten-and-cajole tactics only work face to face, at the counter. The problem is that upselling and dealing with disputes over upselling takes time: 43% of people told an iCarhireinsurance.com survey they had no idea that if they didn't buy insurance, the full excess would go on their credit card for the duration of the rental. While it may help with your margins, the approach doesn't help with your queues or the popularity of your brand.

How to make airport car-hire better

There is some movement at some airports. New entrants can't afford a desk at arrivals, which is why the incumbents have got away with it all for so long, but there is a model emerging of peer-to-peer lending of cars already parked at airports (for instance, Car & Away at Gatwick).

Advertisement - Article continues below
Advertisement
Advertisement - Article continues below

I'm also interested in Virtuo, which promises to leave premium cars in car parks for you to pick up. This is worth watching, though the incumbents will have been quick to point out to airport owners that if car park operators are going to get into car rental they should be charged the same price for car parking as car rental agencies. It is still small scale and limited to bigger airports.

The good(ish) news, then, is that there are ways to stick with the big names and make airport car hire less awful. Buying your excess insurance separately should save you £100 a week, but be aware that the full excess is still likely to be added to your credit card so you will need a high limit. Or check to see if your credit card offers excess insurance.

I have it on my American Express card. You can get it more cheaply elsewhere, but when we drove the nondescript nothingness into a car park payment machine (they were, I'm afraid, both asking for it) Amex covered it with no fuss at all.

Bring your own car seats (try Trunki backpack seats). Then get either an Avis Preferred or a Hertz Gold membership. Both are "free" I use quotes because you pay in data, brand commitment and premium pricing. Both let you jump the queue and go direct or almost direct to your car and both give you a marginally better chance of getting the car you wanted. None of this is fail-safe you could still get a Megane but it does at least represent progress.

This article was first published in the Financial Times

Advertisement
Advertisement

Recommended

NS&I: a safe home for savings
Savings

NS&I: a safe home for savings

State-backed National Savings & Investments is ready to accept much more money and offers some of the highest interest rates.
28 Jul 2020
Want a pet? Watch out – they are a pricey proposition
Personal finance

Want a pet? Watch out – they are a pricey proposition

Dog and cat ownership is booming. But before you invest in a furry friend, consider how much it costs to buy, feed, care for and insure one.
22 Jul 2020
Covid-19 has caused a spike in divorce – here's how to cope
Personal finance

Covid-19 has caused a spike in divorce – here's how to cope

Lockdown has caused a spike in people filing for divorce. But splitting up involves some arduous administrative tasks. Here's what to do.
14 Jul 2020
Look beyond cash Isas to stocks and shares
Stocks and shares ISAs

Look beyond cash Isas to stocks and shares

Interest rates on cash Isa accounts are too low and stocks do better over the long term. Consider a stocks and shares Isa instead.
7 Jul 2020

Most Popular

Gold bugs' dreams are coming true – but we could still see a V-shaped recovery
Gold

Gold bugs' dreams are coming true – but we could still see a V-shaped recovery

John and Merryn talk about how it's perfectly reasonable to expect a V-shaped recovery and to continue holding gold as well. Plus, inflation, staycati…
30 Jul 2020
UK banks have had a shocking week – so it’s probably a good time to buy
UK stockmarkets

UK banks have had a shocking week – so it’s probably a good time to buy

Lloyds Bank reported a £676m loss this week. And, with all of the UK's high street banks having a terrible time of things, bank stocks are detested ri…
31 Jul 2020
The charts that matter: gold finally sets a new record high 
Global Economy

The charts that matter: gold finally sets a new record high 

As gold surges past its previous high, John Stepek looks at how it's affected the charts that matter most to the global economy.
1 Aug 2020