money Travelers turn to U-Hauls, car-sharing amid car rental shortages
Tourists in need of wheels are renting cargo vans and other people’s vehicles to get around the nation’s rental car shortage, especially in popular vacation destinations like Hawaii and Florida.
“We have seen a considerable uptick in U-Haul rentals from customers who are visiting the islands now,” Kaleo Alau, president of U-Haul Company of Hawaii, told Yahoo Money, noting the primary demand is for pickup trucks and cargo vans with reservations lasting a few days to a week. “We realize this demand is occurring when tourists are unable to secure a rental car, or they learn that our rental fleet options are more affordable.”
Read more: Summer travel 2021: Tips for getting a car rental
The shortages in car rentals stem from the pandemic. When demand plummeted last year, car rental companies sold off 30% to 40% of their fleets, Jonathan Weinberg, founder and CEO of AutoSlash, previously explained to Yahoo Money. But as travel ramps up along with vaccinations, the companies haven't replenished their fleets fast enough.
"The rental car companies simply underestimated demand, the amount of people that wanted to get away," Weinberg told Yahoo Finance Live earlier.
The strain has contributed to a dramatic price increase in places like Hawaii where any available cars are as much as $500 a day. Car rentals in other sunny destinations like Phoenix, Las Vegas, and several cities in Florida also are increasing.
Read more: Coronavirus: How to take care of your car during a pandemic
Still, the trend of renting U-Hauls seems to be isolated in the Aloha State as the company isn’t “aware of these circumstances happening in other markets, at least not with tourists and not to this degree,” according to a company spokesperson. A Penske Truck Rental representative shared that the company also “is not seeing any signs that consumers are renting its smaller moving trucks or vans to replace the rental cars they cannot get access to from the car rental companies.”
But there has been a flurry of activity on peer-to-peer car sharing marketplaces that circumvent companies like Enterprise or Hertz. Similar to Airbnb or VRBO where property owners can rent vacant bedrooms or homes for extra cash, car owners can put their idle wheels to work for drivers looking to rent their car for a specified period of time.
“Turo hosts have been telling us that their businesses are booming due to the surge in travel and sky-high rental car prices,” Turo CEO Andre Haddad shared with Yahoo Money.
Getaround has also “seen a significant increase in demand in recent months across the country,” the company’s vice president of marketplace and operations, Pat Notti, told Yahoo Money.
Read more: 6 tips for buying a car during the pandemic
“Our business in Florida has more than doubled since this time last year,” he said. “[There is] particularly heavy demand for our connected contactless car sharing service in Fort Lauderdale and West Palm Beach, two of our newest cities.”
Opportunistic car owners looking to make a couple of bucks are getting into the action, too, Notti said.
“The rental car shortage is an additional incentive for car owners [or hosts] to share their cars on Getaround,” he said, “and we’ve seen growth in our Power Host program as hosts are seeking to take advantage of the increased demand.”
Stephanie is a reporter for Yahoo Money and Cashay, a new personal finance website. Follow her on Twitter @SJAsymkos.
‘Ready to make up for lost time:’ Americans plan to splurge on travel this summer
Government places 'Do Not Travel' advisories on 80% of world's countries
Follow Yahoo Finance on Twitter, Facebook, Instagram, Flipboard, SmartNews, LinkedIn, YouTube, and reddit.
