The rental car shortage of 2021 isn't over: Why summer travel is expected to drive demand

Sean Schick had his Myrtle Beach vacation all planned out: His family's flight would arrive on March 22, a rental car would take them to their hotel, and the rest of the spring break trip would be spent soaking up the sun in South Carolina.

But when the Schick family went to pick up their Hertz rental, they were greeted with an empty lot.

"We were told that our reservation had been closed," Schick said. "They were fully booked out of cars and had no options for us."

The family ended up having to drop an extra $60 on Uber rides to their hotel and, the next day, another Hertz location that could offer them a vehicle. Schick mentioned the Uber rides to a representative but has not had the expenses reimbursed.

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The rental car shortage that upended travel plans in summer 2021 is far from over. Though rental car companies say they’re working to resolve supply bottlenecks,travelers looking to reserve a vehicle can expect fierce competition and scarce inventory this summer.

"Things are not as bad as they were a year ago, but that doesn't mean things are good," Greg Scott, spokesperson for the American Car Rental Association, told USA TODAY.

Rental car shortage: It's 'still a tight market'

The rental car shortage can trace its roots back to the beginning of the pandemic in 2020, when rental companies were selling vehicles to compensate for a lack of travel demand.

Leisure travel has largely rebounded since then, but a semiconductor chip shortage has left manufacturers struggling to produce enough cars for rental companies to match demand.

In a statement to USA TODAY, Hertz spokesperson Lauren Luster noted that the microchip storage "continues to impact the rental car industry."

Scott said the outlook has improved since last summer, but car rental companies are still struggling to rebuild their fleets. And with business travel demand picking up, leisure travelers can expect to face even more competition for rental cars this year.

"It's still a tight market for rental cars," Scott said. "The situation is getting better, companies are securing more new cars than they're retiring, but it's not nearly to the extent that they would like to."

That has left travelers like Phila Bomela of Washington, D.C., out of luck securing a rental car. Bomela said she nearly missed a friend's March 25 wedding in New York after reservations with both Avis and Hertz fell through.

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She ended up making a last-minute fix to her personal car's tires and made it to the wedding just in time.

"My biggest issue was just the communication on their part," Bomela said. “If I had known earlier or at the time of the booking or even the morning of, I would have at least been able to make other plans (sooner).”

Schick, the traveler from Illinois, had similar sentiments.

"I understand there are supply chain shortages. However, they need to do a better job of setting customer expectations," he said. "If you can't fulfill the rental, then you shouldn't take the reservation in the first place."

Scott of ACRA recognized that while there are times customers learn their rental car is unavailable at the last minute, he said it was the "exception rather than the norm."

"If someone does not return a car on time or if there are more walk-ups versus long-term reservations, it's hard to anticipate the business at a particular location," he said. "Car rental companies want to rent you your car. Being dissatisfied – that's not what we want to have happen."

Luster added that "it's not common" for Hertz to find itself unable to provide a reserved vehicle class at the confirmed time.

"It's our policy to make every reasonable effort to assist the customer, which may include providing a comparable vehicle at the same rate if available, moving a vehicle from another location in close proximity, delivering a vehicle to the customer, paying for a taxi or sourcing a vehicle from a competitor if at an airport," she said via email.

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Summer travel to drive up rental car demand

Scott expects supply problems to last through at least the summer, the peak season for rental cars.

Meanwhile, rental companies are scrambling to find ways to rebuild their fleets.

Luster said the company is working closely with its partners to add vehicles to its fleet, purchase pre-owned vehicles with low mileage and move vehicles to areas with the highest demand.

A statement from Enterprise Holdings spokesperson Danielle Stuart said the company is working with manufacturing, insurance and business partners to support customers' "most immediate transportation needs."

Avis Budget Group did not respond to requests for comments, but CEO and president Joseph Ferraro noted in an earnings call that there is "some degree of uncertainty" around receiving new vehicles.

"The fleet situation is certainly a very fluid one. It has not been normalized from 2019, and it's not going to be normalized as we see going forward," Ferraro said Feb. 15.

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Luck at securing a rental can vary based on location. Luster of Hertz said the industry is seeing strong demand for spring break travel in warm-weather destinations and expects to see similar trends this summer. Stuart of Enterprise pointed specifically to Florida, Hawaii, New York, California and Las Vegas as destinations with high demand.

Travelers who are able to nab a rental can expect prices to be higher than they were before the pandemic. Rental car and truck prices for consumers jumped 39% from February 2020 to February 2022, according to the Bureau of Labor Statistics.

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How to secure a rental car

For those who plan to travel this spring or summer, here are some tips on how to secure a rental car:

► Book your reservation as early as possible.

► Consider picking up your rental car at a location not attached to an airport. Searching for flexible pickup dates can also help widen your rental options.

► Be flexible with what kind of vehicle you're renting. Stuart said specialty vehicles such as vans, pickup trucks, convertibles and large SUVs tend to be in high demand at Enterprise.

► Join a car rental company’s loyalty program to skip the counter for a faster pickup experience. These programs are often free to join.

► Check other options on car-sharing platforms like Turo or Avail.

This article originally appeared on USA TODAY: Car rental shortage: Expect high demand at Enterprise, Hertz, Avis