High Demand Tests Ground Transport Supply


Whether for safety concerns to limit potential exposure to Covid-19, or because of sustainability desires, the demand for ground transportation options for business trips continues to grow. But the environment has changed since March 2020.

It’s been well-publicized that car rental companies, after decimating their fleets with significant sell-offs during the beginning months of the pandemic, found themselves with supply shortages once demand started to return. Though primary rental agencies have begun to bolster their fleets, they still are behind 2019 numbers, and some have redistributed their inventory to destinations with strong leisure demand. 

It doesn’t look like this will change markedly anytime soon, given the ongoing semiconductor chip shortage and nascent-but-growing return to business travel. Still, some travelers who used to fly shorter distances are opting for car rentals for social distancing—or because airlines have cut certain secondary and tertiary routes. 

As a result, many business travelers find they may need to book further in advance to ensure availability. Prices have spiked to take advantage of this strong demand. In 2019, the mean daily price for car rentals was $77, according to J.D. Power & Associates. It increased to $85 in 2020 and stayed steady in 2021, at $84. But year to date in 2022, it’s $91.

In addition, Hertz exited or renegotiated corporate contracts during bankruptcy restructuring, so some companies aren’t getting the same deals as before. Rising gas prices add to the costs. 



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