Competition and Uber help push down car rental rates


A traveler walks by a line of Toyota cars parked at the Hertz’s rental lot near Los Angeles International Airport. Rates for car rentals have dropped thanks to increased competition.

(Ringo H.W. Chiu / For The Times)

The cost of travel is declining but some of the savings have nothing to do with cheaper fuel prices.

The average domestic airline ticket fell to $372 in the third quarter of 2015, a 6% drop compared to the same period in 2014, according to the latest data from the U.S. Department of Transportation. Travel experts attribute the decline to a 30% to 40% slide in airline fuel costs over the last year.

Travelers are enjoying even bigger car rental savings. The average car rental rate for business travelers in the fourth quarter of 2015 was $38.88, a 13.6% drop over the same period in 2011, according to an analysis by Travel Leaders Corporate, a Miami-based travel management company.

Among the key reasons for the decline are a series of mergers among the major car companies over the last few years, sparking a price war among the remaining competitors, said Parker Schlank, vice president of growth for Travel Leaders Corp.


Another reason for the price drop is the added competition from ride-sharing services such as Uber and Lyft, he said. “People want to do what is easiest and fastest,” Schlank said.

In fact, American Airlines announced a partnership with Uber last week that offers the carrier’s passengers discounts to use the service. As part of the partnership, elite members of American’s loyalty reward program will get up to $25 off their next Uber ride.

To read more about travel, tourism and the airline industry, follow me on Twitter at @hugomartin.

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