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Car rental services are booming in California, where one-third of households have cars, and one in five renters have cars.
But many car rental companies are getting squeezed by rising rent costs.
As of last year, the average rental company was receiving more than $10,000 per year from car owners in California—compared with $4,000 for a car-rental company that operates outside the state.
Some car rental agencies are using a “one-size-fits-all” model: They rent cars and drivers to clients, and charge the lowest prices.
In some cases, car rental drivers work for their own businesses.
Some say their customers are the ones who are hurting.
“I don’t think there’s any way that we could possibly be able to compete with them on price,” said David L. Dominguez, who runs a car rental company in Los Angeles and has leased about 1,100 cars to clients in recent years.
“If they’re charging $5,000 or $10.00 per month, they’re going to have a hard time keeping up.”
Losing drivers to other car-hiring firms isn’t cheap.
Drivers who work for other car rental firms can make as much as $10 an hour.
They often have to pay for their car with the driver’s paycheck or a credit card.
Car rental companies also charge higher rates than car-hire companies, with some charging customers a maximum of $5 per hour, even if the driver is not working for the company.
Car rentals have been a popular way to keep people from leaving the house, and many have been popular in California.
For example, in February, the state enacted new laws to prevent car rental businesses from forcing drivers to work for them.
In January, California’s Consumer Protection Bureau warned that car rental services in California were making their workers work for the owners, and that companies could be breaking the law if they charged customers more than they would if they were renting out their own cars.
Losing the car to a third-party could cause the driver to lose the car, and the driver could have to replace the car.
That could hurt the car’s value and drive it into bankruptcy.
Many people in California are using car rentals to save money on their car loan payments, and some say they prefer to rent cars to people they know.
But some people say they don’t want to pay more money for a rental car if they can get a better deal elsewhere.
“My wife and I are doing the best we can to stay out of debt and not take on too much debt,” said Melissa Schmieder, who has rented out her 2009 Mercedes-Benz to two different car rental and finance companies in Orange County.
“We’re saving money, and I think our car will get better as time goes on.”
But even some car rental owners say they are willing to do what it takes to stay in business.
In recent years, car-sharing services like Zipcar have been able to increase the number of cars on the road, and there is evidence that the trend is paying off.
The companies charge about $15 per month for cars they rent, and they have found that car-share drivers earn more than their car-truck drivers.
“There’s definitely a market for these services,” said Rob Kneebone, who owns a car sharing company in Long Beach.
“A lot of people are getting a bit of cash out of renting out cars.
I don’t know how they’re earning that.”
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