Rental Car Industry Is Putting A Strain On U.S. Automakers

The slowing economy has taken a toll on just about everyone in the country. This is certainly not untrue for the big names in auto manufacturing and this is mostly due in big part to the rental car industry. The rental car business buys up many of the excess vehicles that the car companies produce each year and since the economy has slowed, so has the amount of would be travelers. One of the main spots for renting vehicles is at the airport and with a decrease in travel, not as many vehicles are being rented. Thus, the rental car companies are forced to keep the vehicles in their fleet longer than normal and this causes the companies not to buy vehicles as often.

On average, rental car companies are now on their way to keeping their vehicles 15 months, as opposed to the 10-11 months in the past. This is putting a strain on the three major car manufactures in the country, because in order to get rid of the overflow of new vehicles, they have to lower the sales price of the vehicles just to sell them to the rental companies. Rental car companies, in this situation, can pretty much offer whatever price they want to, putting further stress on U.S. automakers.