International car hire firms taking locals for a ride, says councillor

Tourists or residents renting a car in the Republic are questioning the practices and charges of some car hire companies.

The Director of Consumer Affairs, Ms Carmel Foley, was recently asked to investigate the e-commerce operations of the leading car-hire companies operating in the Republic.

"Companies like Avis, Europcar and Hertz are fleecing their customers on the Internet. They charge up to 265 per cent more for car hire by Irish people than they do by visiting tourists," claimed Cork County Councillor, Mr Peter Kelly. His comments followed submission of a complaint concerning online car hire quote discrepancies to the director at the end of October.

The director has carried out an investigation into the matter, said a spokesman. The car hire companies have not broken the law as there are no price controls in the Republic, he said.

The director found no discrimination against Irish residents but found there are "certain elements of mistake" in the computer technology. "We are satisfied that it was just an error in the operation of the new technology," said the spokesman.

The director's office has not, as of yet, directly informed Mr Kelly of the investigation's results.

Mr Michael Ring, Fine Gael spokesman for Agriculture, has received complaints from tourists who felt they were overcharged by the industry.

"The problems with car rental companies often arise when customers go back to return the cars and they are charged extra. There's nobody dealing with the complaints," he said.

One tourist said he was charged an additional £109 (€138.40) for insurance and a £35 petrol deposit as a valeting fee. Mr Ring has accused the Car Rental Council of Ireland (CRCI), which is a self-regulating industry body, of not dealing with complaints promptly and has called for improved legislation in the sector.

The turnaround time for complaints by the CRCI depends on their nature, says chief executive Mr Bob Prole. "One of the difficulties with complaints is that they're not always very clear but we deal with them very promptly," he said. "The number of complaints are infinitesimal in relation to the number of hirings."

Despite these ongoing complaints, research conducted by Family Money last week revealed that some car hire companies offering online quotes are still charging more if a person lives in the Republic.

The sample car hire quote requested online was an intermediate category car rented on November 26th at Dublin Airport and returned to the same location on December 10th. Five car hire companies were asked for two online quote requests - residency was indicated as Irish in one and the US in the other. (See accompanying chart).

The highest discrepancies between prices for US versus Irish residents were with Murray's Europcar (www.europcar.com) and Avis (www.avis.com).

Using the sample criteria, Murray's Europcar online reservation service delivered a quote for an economy car of £297.93 for a US resident and £751.50 to an Irish resident for the same car for 14 days. These prices include airport surcharge and taxes. Insurance charges are the same for both residents.

Murray's Europcar said they had been notified of the problem by the Director of Consumer Affairs. The company said the site is being corrected.

Avis responds to rate requests by e-mail and quoted a price for a group C manual car, similar to a Toyota Avensis, of £403.05 ($528) for a US resident and £854 ($1,119) for an Irish resident.

Avis's assistant general manager, Mr Kevin O'Donoghue, says Avis's international Internet site is relatively new. "We never considered it as a source of business for Irish people booking in Ireland. It was an oversight, it's not a pricing policy," he said. The company expects to have the system changed within the next few weeks.

A US resident renting with Hertz (www.hertz.com) using the same specifications as above is charged £366.75 including airport fees while an Irish resident pays £511.25. The Hertz quote says: "Approximate rental charges are based on available information at time of reservation.

Additional fees or surcharges may be applied at time of rental." It does not specify the amount or nature of these fees.

Hertz Europe Ltd is uncertain if it received communication from the Director's office but says it has heard this complaint on previous occasions. The problem is related to source market pricing, says a Hertz spokesman.

In a statement Hertz said international car rental companies compete on price at both ends of the market: source, where the customer lives and books the rental and the destination, or pick-up end.

"This means that residents of one country will have available rates (at both lower and higher levels) different from those available to residents of other countries. This form of competitive pricing within markets is common not only to the car rental industry, but all segments of travel." Hertz does not intend to change its online prices.

Car hire companies like Alamo (www.alamo.com) and Nationalcar (www.nationalcar.com) charge single rates regardless of where a customer lives. Both Irish and US residents were charged £303.75 including VAT by Alamo and £260 by Nationalcar when booking online.

On its rate quote Alamo warns customers that the "total may vary slightly at the time of rental based upon pick up/drop-off times, Alamo contracted rates and/or election of optional coverage items". Nationalcar says that additional charges may apply.

Mr Kelly believes Irish residents are charged more because they are accustomed to paying high rates whereas British and US tourists would be loath to pay such exorbitant amounts to hire a car.

CRCI chief executive, Mr Prole, says under the law they may not interfere in pricing policy but he believes car hire prices in the Republic are very competitive.

Although US residents are getting better rates from the car hire firms, complaints about high insurance charges have been highlighted in the Irish media in the US.

In February and July, New York-based newspaper the Irish Echo reported that Irish-Americans visiting Ireland were distressed to find that their credit card companies no longer automatically provided collision damage insurance for cars rented in Ireland. These tourists were then asked to pay £10 a day to obtain the coverage from car hire firms.

The credit card companies said that because of a disproportionate number of damage claims they were no longer providing the coverage, said the newspaper. In a later twist, the paper reported that a reader claimed Visa told him the lack of insurance cover was due "to the non-co-operation of the Irish fleet owners with the credit card companies".

Visa provides card services to their member banks who then add on options such as insurance cover according to cardholders' needs, says a spokeswoman. Individual banks are responsible for the credit card insurance cover. In recent years, a damage liability clause was added to car hire contracts in the Republic making customers liable for any damage caused to the car, said the Visa spokeswoman. With the addition of this clause, "car hire companies are entitled to delay or amend charges to the card", she added.