MONEY - Rental cars show positive economic trend
Empty car lots at local rental car agencies show Peoria's economy in a positive light.
While many car rental business hustle to rent larger, gas-guzzling cars, Peoria outlets do not appear to suffer from that problem.
The Associated Press reports a current national trend shows car rental agencies apparently cannot keep enough of the smaller, more fuel–efficient cars on lots to meet demand.
Most of the car rental companies’ return on investment is from customers upgrading to larger cars and more services, and they will do nearly anything to move the large metal off the parking lot.
There was a time when most rental car customers welcomed an upgrade to a midsize or sedan, a minivan or an SUV, but not anymore. That was before gas climbed to almost $4 a gallon.
There has been a long-standing tradition among car rental agencies to push renters up to bigger, more expensive models. Not that it was all that difficult to do, considering that Americans tend to prefer larger vehicles when all other aspects are equal.
Today, though, the act of stepping up to an SUV from a bare-boned box of a compact car no
longer holds the allure that it once did. In response to skyrocketing fuel costs, they frequently entice customers to accept the gas guzzlers for the same price as the economy or compact car — a complimentary upgrade.
That trend, however, is not playing out in Peoria. Most of the time, Peoria rental car companies are pressed to have a car available during the week.
“We don’t have that problem getting drive time on our larger vehicles. Most of our business is the business traveler,” said customer service representative Kyle Volk, who works for Hertz Rent-A-Car at the Greater Peoria Airport.
“We pretty much rent out our fleet — anywhere from 90 to 110 cars — on a Monday and get them back on Thursday evening.”
Although Volk said there are times a customer gets an upgrade, it is not because of a need to get road time on the tires of bigger vehicles.
“The business traveler may ask for an economy-class car, but the fleets in Peoria are smaller than in bigger cities, and the bottom line is, the customer just needs a car.”
If a customer asks for a compact car and they do not have that size, Volk said he will upgrade to the next size for the same price, and even compensate them for the difference in fuel.
“However, that is not a Hertz policy, but we want to make sure our customers are happy,” he said.
Likewise, Brett Shanahn, a customer service representative for GPA Budget Rent-A-Car, said,
“We don’t give a lot of free upgrades just to get drive time on the larger cars. Usually, if that happens, it is because we don’t have an economy class car on the lot.”
Volk added, “We operate in customer service, and if they have a complaint, I will do whatever I am authorized to do to accommodate the customer.”
After all, their cars are a commodity, and how are they going to differentiate themselves from other car rental companies is in customer service, both said. Business travel is big business locally. So, with a national economy that seems wobbly, it seems Peoria’s is steady.
Business travelers pump billions of dollars into the Peoria area economy, and Peoria surpasses the national forecast in terms of visitors and economic growth, according to two local experts.
Through direct expenditures, which includes transportation, lodging, food and entertainment, the industry affects salary wages, industry jobs and tax revenue.
“People don’t really know this, but business travel is big business in Peoria,” Peoria Area Visitor and Convention Bureau CEO Brent Lonteen said.
“It is a great indicator of how the travel industry still hasn’t impacted Peoria. It’s a big impact on the hotels, the rental car companies, the shops and restaurants. The business traveler is spending lots of money in Peoria.”
The business traveler includes people who conduct local business representing commercial, industrial and government organizations. They recruit, train and hold management meetings and call on multiple businesses as suppliers, vendors and sales representatives.
Hotels and rental cars that primarily serve business travelers usually rely on the strength of the local business community, Lonteen said.
The size, stability and diversity of major local employers are important factors.
The business travel industry represents a larger portion of lodging and rental car demand in the Peoria market, Lonteen said. With peak business demand during the week, on any given Monday through Thursday, the downtown restaurants are packed with local business people entertaining out-of- town clients.
“On the weekends we try to keep up with that kind of traffic with conventions,” Lonteen said.
Peoria is working hard to have an approach toward global economy, said Peoria Area Chamber of Commerce and Heartland Partnership President Jim McConoughey.
“We (Peoria) have had an extraordinary amount of success expanding the airport and people are booking hotels and cars, buying meals and generally coming to Peoria and staying longer,” McConoughey said.
“The economy is going well in a lot of segments. We have a huge amount of activity in the construction industry, and on any given Monday, we get from 2,000 to 3,000 travelers arriving in Peoria.”