Bumpy Road to Rental Rewards

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ARTICLE

Fewer Miles, but Faster Service

Car-rental companies are steering away from airline frequent-flier awards as a vehicle for building customer loyalty. Several major rental firms have cut back their payouts—offering business or government customers half the mileage they grant their leisure renters.

In some cases, they're awarding mileage by dollars spent, not number of rentals. And the tenuous partnerships between rental companies, airlines, and hotels—marked by more than two dozen realignments in the US and Canada in the past two years—have made the road to rewards even bumpier.

To hear the rental companies tell it, they're investing more resources in what frequent travelers really want: speedier service. They've established—or beefed up—express check-in and -out, letting customers bypass rental counters, and sending attendants out with hand-held computers to whisk returning customers out of the parking lots.

At the same time, some firms are rolling out rental-only programs, offering free days, upgrades to larger car models, prepaid gas cards, and merchandise (mostly for the golf and tennis crowd).

But don't kiss those flight rewards goodbye just yet.

Despite a concerted effort to wean their best customers from expensive, airline-based programs, car-rental executives admit that miles are alive and well. "The main purpose of these (new) programs is to give people a choice," explains a Hertz spokeswoman. "But many renters obviously opt for miles."

Still, calculating the value of rewards on this new playing field can be tricky. And a lot depends on how you earn and use your credit

• If your ultimate goal is to bank airline mileage, you'll still find many opportunities to do so. But watch for new rule changes that can devalue your earnings.
• If saving time is worth more to you than accumulating a few hundred frequent-flier or frequent-stay credits, speedier rental service may pay bigger dividends.
• And if your travel plans include rentals, an upgrade or bonus day may have the most octane.

This report examines the programs of eight major companies. You’ll learn about new rent-for-more-rentals incentive programs, in which customers can earn free days. We'll compare features of the various rapid-in, rapid-out programs for expedited service. And on the mileage-rewards front, we'll show you who's partnering with whom, and calculate your earning potential.

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Rent For More Rentals

Budget, Hertz, and Payless offer system-wide programs that let you accumulate the credit you earn at different locations for use at any participating location. Depending on the rental firm, you can earn credit toward free driving days in one of two ways: each time you rent, or for the dollars you spend:

Rapid-In, Rapid-Out

Banking on the fact that frequent renters want to save time and hassles more than earn free driving days, six of the biggest companies—Alamo, Avis, Budget, Hertz, National, and Thrifty—have introduced express programs. Most are located at large airports, where travelers encounter the biggest delays working their way from the rental counter to the driver's seat.

Fees. If you're not part of a corporate program that offers these services as a negotiated benefit, chances are you'll pay for the privilege of speed. Alamo, Hertz, and National charge $50 a year for their programs; Alamo waives the first year's fees for enrollments over the phone, and National waives the fee for corporate renters. For others, including Avis, enrollment is free.

Pickup. Most of the companies we examined offer time-savers for car pickups. The Car-Rental Ins, Outs, and Incentives table summarizes them, but here are the highlights:

• Computerized renter profile. Six (Alamo, Avis, Budget, Hertz, National, and Thrifty) maintain a file of the customer's driving license, designated charge cards, insurance choices, and car-model preferences, along with blanket preauthorized rental agreements. By enrolling in advance, you avoid the hassle of re-entering information at each rental. The companies can preprint a rental agreement and have it ready when you arrive at the counter or car-pickup location.
• Discount identification. All six companies said they could include a corporate-rate identifier in their system and automatically adjust preprinted rental contracts for such discounts. Two of the six (Hertz and Thrifty) can also include year-round discounts available through various associations and clubs. All but Hertz said they can record membership numbers for frequent-flier mileage programs, and four (Avis, Budget, National, and Thrifty) can store information on hotel frequent-stay membership. Avis and Budget use a system that can record eligibility for just a single airline or hotel program.

None of the automated systems can handle short-term coupons or one-time discounts and upgrades, such as those occasionally distributed by frequent-flier programs, or in other short-term promotions. To use those discounts, you have to deal directly with a rental agent.

• Rental counter by-pass. Four of the six companies let you skip the counter completely, at least at major airports, and proceed directly to the pickup area, Alamo has self-service kiosks, and Thrifty staffs preferred-renter counters. Where they can't offer a complete bypass, most provide an express line at the counter for frequent renters.
• Alamo Quicksilver. This electronic self-service system features kiosks where you insert your credit card or Quicksilver membership card and enter the reservation number issued when you booked. The computer then prints out a rental contract that is based on information from a master agreement and shows the location number of the car (with the keys inside).
• Hertz's #1 Club Gold. A CRTL staffer who tried out all the rapid in and out systems (at San Francisco Intl Airport) found Hertz's service to be the most fully realized. As a #I Club Gold member, you board a Hertz shuttle from the baggage claim area. You'll be dropped off at a canopied area first (ordinary renters get off at the next stop). There, an electric sign shows your name and the location of the car; the rental agreement and the keys are already inside. According to Hertz, the cars are even pre-warmed in cold weather. Once in your car, you can drive directly off the lot, pausing only to show the contract to a guard. #I Gold Club canopy areas are available at 38 locations, and Hertz is in the process of adding sheltered “return centers."
• National’s Emerald Club. The car rental cormpany abandoned similar ATM-type pickup and drop-off systems called SmartKey, and instead shuttles members directly to special "Emerald Aisle" parking bays. The program offers 5-15% discounts on midsized cars, but members can choose any available car parked in the area—mid-sized or full-sized. No paperwork is involved, although National requires that you stop long enough at the exit gate to record the car model and mileage on the rental contract. The rental agreement comes to you in the mail.
• Return. Curbside valet service, in which an attendant drives you from the return area to the airport's departure area in your rented car, is the only car-return perk available exclusively to frequent renters. It costs $6-10 more and is available only from a few rental firms. But it's a nice perk if you don't want to heave a lot of baggage on and off the shuttle. It's also useful if time is short and you can't wait for the next shuttle. But you won't find it everywhere: Many big airports prohibit curbside valet service because of the additional traffic it generates in departure areas.
• Among time-saving return services, roving attendants with mobile check-in computers have become familiar figures. At smaller locations (or after closing hours at some larger facilities), renters may find a drop box where they can leave keys and contracts; the final bill comes later, in the mail. But those services are available to all customers, not just to members of a frequent-renter program.

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Shrinking Miles

Although travelers’ enthusiasm for earning frequent-flier miles has not waned, profit-pressed rental companies feel they can no longer afford that luxury. As a result, most have tightened up on their award schedules—either wholly or partially adopting a two-tier award schedule, typically 500 miles per rental for leisure renters and 250 miles for corporate and other contracted entities.

And Hertz has moved to a revenue-driven formula for a half-dozen partner airlines, awarding leisure renters two miles for each dollar spent, other renters one mile. While Alamo remains on the old one-award-fits-all formula for most of its airline partners, that company, too, seems likely to adopt the new rules in the near future.

Oddly enough—and in stark contrast to the airlines' approach—the new award systems favor occasional leisure renters over "road warriors" (frequent business travelers). In almost all cases, rentals at leisure rates earn double the credit that's earned on rentals at corporate or government rates.

The rental companies defend their new standard by claiming they already give corporate customers special consideration—volume discounts, waiver of some charges and fees that leisure renters pay, and more lenient terms for additional or underage (21-24) drivers. We suspect that many travelers would wish the airlines took a similar attitude.