Magazine for the professional car and truck rental industry.
Issue link: https://autorentalnews.epubxp.com/i/90712
GR EEN F L EE T THE CHALLENGE OF GREEN RENTALS While carving a niche through eco-friendly car rentals, these companies face numerous challenges, such as higher initial costs and keeping rates competitive to worrying about fl uctuating fuel prices and competition from the majors. BY CHRIS BROWN I IN 2007 ARN PUBLISHED AN ARTICLE TITLED "The Greening of the Auto Rental Indus- try," which took a look at the business of renting environmentally friendly vehicles from the perspective of the independent operator. Five years later, we catch up with the players in that story, visit with new ones and take stock of the present market for green rentals at non-major car rental companies. THEN AND NOW In 2007, EV Rental Cars laid claim to being the fi rst car rental company in the U.S. to rent only environmentally friendly vehicles to the public. Started in 1997 in Los Angeles, the company offered the fi rst generation of electric vehicles (EVs) for rent such as General Motors' EV1, the Toyota RAV4 EV and the Ford Ranger EV along with the fi rst hybrid models. EV Rental Cars' parent company, EV Transportation Inc., went public while having the backing of high- profi le industry veteran Bill Plamondon as its chairman and CEO. The company built a fl eet of more than 400 cars serv- ing six locations in California and one in 22 November/December 2012 Phoenix, Ariz. before closing its doors suddenly in 2009. San Francisco-based Bandago Van Rentals, specializing in van rentals to tour- ing musical acts, is alive and well. Ban- dago gained publicity in 2007 by claiming to be the fi rst auto rental agency to be completely carbon neutral by purchasing carbon credits to offset the carbon output of it's fl eet and offi ces. "Our green initiatives have been well received, and we continue to make positive changes," says Bandago Owner Sharky Laguana. "They don't really translate into direct measurable revenue, but they are the right thing to do. While some of the initial efforts might have been a little ahead of their time, the ones who do it now, and do it right, will likely reap rewards in the future from that positive association with their customers." On the car sharing front, Flexcar was absorbed by Zipcar a month after the green article was published. Zipcar has grown to be the world's largest car shar- ing company and has started an EV pilot program in Chicago and a municipal EV fl eet sharing program in Houston. Zipcar rents green models such as Honda Fit EV, AUTO RENTAL NEWS Toyota Prius Plug-in Hybrid and Chevrolet Volt. Zipcar went public in 2011 but has yet to make a profi t — at least as of its 2012 second quarter earnings report. On the Hawaiian island of Maui, Bio-Beetle keeps chugging along using biodiesel made from salvaged vegetable oil from local restaurants. The company, which opened in 2003, rents VW Jetta and Beetle diesel models, and renters can use the same local station to fi ll up. The website is still folksy and rental quotes are still given manually. Loyal repeat customers make up much of the business, which hasn't grown appreciably. "If you'd have asked me 10 years ago if we'd only have 17 cars today, I'd have thought you'd be crazy," says owner Shaun Stenshol. Biodiesel is cheaper in Maui than regular diesel. Yet an expiring federal tax credit of $1 per gallon at the end of this year might not be extended, which keeps a question mark on biodiesel fuel prices. With an environmental focus, Stenshol says it's hard to compete with a $75-a- week economy car special from one of the majors. A weekly rate of $199 for a