GM rental changes

[robc]

With GM's announcement today, does everyone read this the same way I do that we will be getting up to $42/day when providing a highline for a highline? Even getting $37 is better than the $30 - I don't know about every area but $30 in my neck of the woods won't rent you a Kia Rio

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** Rob, Editor Dealersedge/WD&S **
Help is only a message post away!
robc@dealersedge.com

[Service 1]

The way I read the GM DRAC (acronyms what a joke) is that for like kind of vehicle the maximum payable might be as high as $42 per day. However, one of the items in the message was that a vehicle pricing matrix will be provided. So some reimbursement charges might be less. Regardless, I wish GM would negotiate a deal similar to the deals E-prize has with some of the major insurance carriers, which would remove the transfer of funds through the dealership. GM's rule about no mark up on sublet for warranty and rentals does nothing except artificially inflate sales numbers with no gross.This would also remove the accounting tasks for the dealerships, possible reduce personnel expenses and so on.

[Michael White]

I interpreted as high as $42 "for a like vehicle". Rob, as you pointed out, in California, at $30 vehicle will get you a sub sub sub sub compact; something alitltle larger that a motorized skateoard. When we have rented full size trucks and utilities for customers, it is in the price range of $55 to $65 or higher per day. In the real world, a $42 might be something in the size of a Grand Pirx.
My concern is not the money or the confusion related to it. My concern is forcing Enterprise down my throat. In my area, there are 2 Enterprise offices. Both of them are grossly inefficient, I never got my billing on time, customers were charged rentals when I paid for them. I hated dealing with Enterprise. They were a major CSI buster for me. I probably spent between $5K and $6K a month with them. I converted out of necessity to Hertz. Even though they do error, they are responsive and give us excellent service. Part of the probelm with the Enterprise offices in our area is the personnel change so fast, every 6-8 weeks, the probelms start all over again and we could never get continuity with them. The thought of having to go back to them gives me the shivers. However, i do understand why GM would want customers to be in a GM vehicle. In my opionion, putting someone in a $30 ford is good because when thy get back into thier GM product, there is a greater appreciation. But if GM was really serious about rental cars, there would be regional price structures, and a Denali customer would get a like vehicle, no matter what the costs are. But there is no way I can rent a full size sport utility for $42; at least right now. Part of the equation however, that we do not know is that Enterprise does buy vehicles cheaper than the dealers. So we will have to wait until the "fine print" comes out. Also if GM was really serious about using GM rentl vehicles, they should get very serious about dealership rental purchasing. They are not even in the ball game. But maybe when all the fine print comes out, their might be a good program. Who knows. One thing for sure, this will cost GM billions of dollars. With the cost increases, I would bet some very serious enforcement to rules will be occur.

[This message has been edited by Michael White (edited 12-10-2003).]

[robc]

Exactly on all points Michael. Plus, I am really worried about when you have three rentals scheduled and the local Enterprise store calls up and says they don't have any GM vehicles left. The exact same thing happened to them with a very similar arrangement with Ford. Again in our area the Enterprise stores has a wide range of makes but never more than 25% GM's.

Second thing with Enterprise is its, how shall I say, unique corporate environment. Some might call it a cult like mentality second only to Amway. I don't know first hand since I never worked there. But I do know that the level of service you get varies tremendously from store to store, based almost completely on the personality of the managers at the store, since they curn the fresh college recruits every few months.

If it were me, and it isn't, I'd maintain a small fleet and use Enterprise to fill in - or - try to get my own Enterprise facility in-house.

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** Rob, Editor Dealersedge/WD&S **
Help is only a message post away!
robc@dealersedge.com

[This message has been edited by robc (edited 12-11-2003).]