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November 14, 2006

Car rental rates rise

Recent numbers show that car rental rates have jumped. N.C. State University economist Mike Walden gives three reasons why.

For starters, auto makers are producing fewer lower-priced cars," Dr. Walden says. "And those are the kinds of autos that often went into rental fleets.

Second, he adds, "Total auto production domestically is shrinking, so there are fewer domestically made cars available for renting.

"And then lastly fees and taxes, generally local applied on rental cars, are rising," he says. "Local governments have often used fees and taxes on rental cars as a quick way -- and perhaps a way that local voters don’t get upset about -- to raise local revenue. Those fees and taxes are going up.

"Experts, unfortunately for folks who rent cars, see no end in sight for those trends," Walden concludes, "so I think folks need to get ready for even higher rental prices on autos."

Posted by deeshore at November 14, 2006 09:39 AM

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