Why rental car demand is high in Manitoba

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As travel restrictions ease in Manitoba, the demand for rental cars is increasing.

Don Miller, director of operations at U-Drive Car Rental, told CTV News car rentals dropped substantially when COVID-19 hit.

“The only way to combat [the loss of revenue] is to ‘de-fleet’ or sell cars to the point where it makes sense to continue operating the business,” Miller said.

But as borders open up and the number of travellers increase, there’s fewer rental cars available—and the automotive industry as a whole can’t keep up with demand.

Earlier this week, the Canadian Press reported that a global shortage of semiconductors has crippled vehicle production and caused lengthy delays for new cars and trucks.

“It’s very difficult for us to ‘fleet up’ right now,” Miller said. “It’s not something you can do overnight.”

The car rental shortage has been dubbed ‘carpocalypse' in the U.S., but reported skyrocketing prices haven’t hit Manitoba yet.

However, Miller said the demand for rental cars is increasing based on U-Drive’s reservations, bookings, and the number of rental vehicles they consistently have available—but doesn’t think demand has hit its peak here yet.

“As the airport opens up, there’s no doubt about it.”

But, like any business that relies on supply and demand, Miller said the industry will level off, likening it to lumber shortages earlier this year.

“As things normalize, pricing will normalize,” Miller said.

A CAA Manitoba spokesperson said they’ve noticed a slight increase in car rentals this summer, and added retail locations around Winnipeg have been receiving more inquiries about booking car rentals across Canada, the U.S., and Europe.

—With files from The Canadian Press