Rental car firm warns of higher prices

One of Europe’s leading car hire firms, Avis Europe, has warned its customer base of possible higher rental prices for the future, as demand has dropped. In a statement they said that they have had to keep costs down to a minimum to control their fleet but the drop in demand on both business and leisure has made them implement higher charges and the industry will continue this way as demand stays the same. Avis in Europe have themselves cut their fleet by almost 20 per cent to just 84,000 vehicles. This has had an impact on their revenue, and they have increased costs to cut overheads down in the worldwide recession. They have also cut costs by restructuring their branches and put a stop on new hiring staff as well freezing current salaries.

The low demand in rental days they experienced at the start of the year did nothing to help the industry, but summer period peaked for them  helping most firms across Europe alleviate some of the pressure. July and August was particularly good for the hire car industry with most selling out their fleet for the complete two months. But a reduction in fleet offset their revenue which is why prices were increased during the busy period. This was much the same across the network of firms in Europe as there were stories emerging of some unscrupulous independent agents that were charging up to fives time the normal amount. For those planning on using a higher car next year, it is probably best to  start looking now for the best deal as fleets are not set to rise by many and this could lead to a similar situation.