'It’s just bonkers': Saskatoon car rental company faces increased demand
The demand for rental vehicles has gone up significantly as COVID-19 restrictions have eased across Canada, and one Saskatoon car rental company says it’s feeling the heat.
“Real busy, 24 hours a day kind of busy, like you know, 200 calls a day kind of thing,” said James Lockwood, vice president of Easy Rent Auto.
Easy Rent Auto has about 50 cars in its fleet and has nothing left to rent, according to Lockwood.
With some rentals starting at $15 a day, the company is also seeing more people extend their rentals from a week or two weeks to months.
“We’ve been locked down for how long, you want to get out and go and then when you’re on the road, they just seem to want to keep on going. So, I can’t blame them for that. People are getting out and enjoying and breathing,” Lockwood told CTV News.
Lockwood said he started seeing this increase in demand over the last three to four months and it’s showing no signs of stopping.
“Right now it’s just bonkers busy because now everybody’s come back and they’re now travelling.”
According to Associated Canadian Car Rental Operators, many companies sold off their fleets during the early stages of the pandemic due to drops in customer demand and are now having issues sourcing vehicles to meet increased demand.
That’s due to a global shortage in semiconductor chips needed to produce new vehicles.
“It is very likely that industry fleets are down as much as 15 to 20 per cent from where they would normally be this time of year,” said Craig Hirota, vice president of government relations and member services at Associated Canadian Car Rental Operators, in a statement to CTV News.
As a result, Hirota said this is also causing the price of rental vehicles to skyrocket.
“Current pricing for available rental vehicles reflects the imbalance between demand and supply. At the moment, while the industry is hopeful new vehicle availability will be resolved sooner, many automakers are forecasting supply chain issues to affect production into 2022.”
Vaughn Wyant, CEO of the Wyant Group which operators about 18 automobile dealerships across western Canada, said he has seen the effects of this first-hand.
“What we’ve been seeing is nothing we’ve witnessed ever in our industry and frankly, in other industries,” he said, adding that vehicles require dozens of semiconductor chips.
“We’re seeing historically low days supply in every single brand whether it’s a premier import brand like Jaguar, Land Rover or Porsche or whether it’s a domestic brand like Ford.”
Wyant said it’s at the point where if you want a new vehicle, you could end up waiting three to four months or even until next spring to get it depending on the brand.
“We have very little supply on the ground, and you’re kind of faced with, if you want a vehicle and it’s on the ground and it’s not the right colour, you better learn to like the colour that’s on the ground or you’ll wait a really long time.”
Wyant added that the lack of production of new vehicles has a widespread effect.
“The availability of pre-owned vehicles or used cars and trucks is staggeringly low so, when you don’t sell as many new, you don’t take as many trade-ins, you don’t have as much supply.
“So, it’s even more critical on the pre-owned side because a lot of the population buy pre-owned vehicles. So this is a trickle-down effect, it starts at the top with the supply of new vehicles and it goes to the supply of pre-owned vehicles.”
Something Easy Rent Auto president Cal Thoen is also dealing with on the consumer side.
While his company hasn’t sold off any of its fleet, it is having issues buying new vehicles so it can expand and serve more people.
“Well, lack of new cars and it effects from the shiniest new thing down to the oldest clunker that still runs. They’re all worth more because of that. It’s put a dent in the market that will probably take two to five years to really settle back,” he said.
Lockwood added, “It’s super frustrating because you’re missing lots of rentals in a day that you can take care of. But I think Cal has been really great at buying. We just got another one. You know, it’s a daily process really trying to find more rides that will work.”
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