Magazine for the professional car and truck rental industry.
Issue link: https://autorentalnews.epubxp.com/i/90712
biodiesel Jetta is as low as he's willing to go. However, a year ago he moved from set rates to scaling prices for his green machines based on the competition and then added a reasonable premium. That translated to a smaller rate disparity mar- gin than the majors, which has kept more cars on rent. Today, Stenshol is catching the wave of EVs and has gotten pragmatic about align- ing business decisions with government initiatives and manufacturer deals. The state of Hawaii, a leader in green initiatives, now requires parking lots with 100 or more parking spaces to have at least one EV charging station. While implementation is slow, charge ports are coming online at hotels and retailers. DC Fast Chargers — which can fully charge an EV in as little as 30 minutes — have arrived, including ones at the entrance to Mt. Haleakala and the famed Road to Hana. Stenshol took advantage of favorable lease deals to acquire a Nissan Leaf and Chevy Volt. In deference to the new trend, Stenshol has offi cially renamed the com- pany Bio-Beetle Eco Rental Cars. With a new focus, Stenshol is upbeat about the future: "Overall [the business] is moving in a good direction because it's not just biodiesel now; we're about offer- ing the greenest cars available." BANKING ON HYBRIDS VERC Car Rental, serving eastern Mas- sachusetts through six neighborhood locations, recently purchased 200 Toyota hybrids (150 Priuses and 50 Camry hy- brids), which constitute close to 60% of the fl eet. The large hybrid buy was motivated fi rst by a desire to get noticed by the local renting public. "We're battling Enterprise and Hertz every day," says owner Jack Vercollone. "We wanted something to make us stand out in our marketplace." Reason two was an eye toward resale. "We've done pretty well with our hybrids in the past," Vercollone says. "If you hit the [used car] market just right, especially on the East Coast when gas has gone over $4 a gallon, that's a great time to sell these." When Toyota came to VERC with availability and decent pricing, the deal was made. For the VERC customer, the desire for a hybrid rental is based more on fuel savings than on saving the environment. "Some people brag about it," Vercollone MPG Car Rental in Venice, Calif. was launched in 2011 as an all-green rental company, though manager Paul Her- nandez says the company is building its reputation based on its service and positive online reviews. Hernandez (left) is joined by Patrick Levenson, assistant manager and Steve Vahidi, owner (right). says. "One renter was pretty proud of the fact that he went all the way to Maine on $20 in gas." Vercollone says that four or fi ve years ago, a number of customers would not even take a hybrid rental if offered one. Today, "We do have customers requesting hybrids," he says; however, "we haven't gotten to the point that we're a magnet for people that have to have a hybrid [rental]. Maybe that will happen when gas prices rise another 50 cents." VERC does not charge a rate premium for its hybrids, but its major car competi- tors in the area do. Vercollone contends that most of his customers would not opt for a hybrid if they had to pay $10 more per day. Larry Sullivan, VERC's CFO, no- ticed that when pump prices spiked in the spring his competitors were able to boost their hybrid rates. Sullivan doesn't know what the exact fuel price tipping point would be to raise hybrid rates over and above its normal fl eet, but that will be an option, he says. Absent a rate premium, keeping hold- ing costs in check is where the rubber meets the road. Vercollone and Sullivan say the capitalized costs for their hybrids are about 10% higher for the Camry hybrid and 20% or more for the Prius compared to a midsize, regular gasoline model. That makes VERC's market timing for de-fl eeting all the more important. In general, Vercollone admits that the company is in the midst of fi guring all this out. "We recognize that it's a risk; we recognize we're early into the game, and we're hopeful," he says. AN ALL GREEN FLEET MPG Car Rental was launched in Janu- ary 2011, billing itself as "the premier all-green car rental company in Los Angeles." The company rents a wide range of hybrids, including luxury, crossover and SUV hybrid models as well as the plug-in hybrid Chevy Volt, Toyota Prius Plug-in Hybrid and Volkswagen Jetta TDI. Traditional gasoline-powered models are not offered. Paul Hernandez, MPG's manager, credits the company's success more to its customer service than its green rental fl eet. Hernandez contends that MPG is the only car rental company in Los Angeles that has all fi ve-star reviews on Yelp, which has become a key driver of refer- rals. The company's fl eet has more than doubled since opening, growing from 25 AUTO RENTAL NEWS November/December 2012 23