Domestic automakers have been seeking to reduce their reliance on fleet sales -- which basically means sales to rental car companies. Fleet sales are the crack cocaine of the automotive world. They move inventory, but they also lower resale values, which hurts consumer sales and makes the automakers even more reliant on fleet sales.
Frankly, I think the automakers are going about this all wrong. The way I see it -- and bear in mind, this is a guy with a four-year state school education second-guessing the suits with MBAs -- fleet sales could be transformed from a Band-Aid for the bottom line into a spectacular PR opportunity.
One of the biggest problems is that car rental fleets always seem to highlight the very worst of the domestics. My wife Robin and I recently went on vacation with four adult friends, so we rented a minivan. Hertz gave us a Chevrolet Uplander. Now, I know that Chevrolet has been turning out some excellent cars -- the 2008 Malibu and 2008 HHR SS are great examples. But the Uplander is a seven-passenger rolling turd. It's an ancient design, the interior is cheap and plasticky, it pitches and rolls like a '74 Buick, and after 11,000 miles of rental-fleet abuse our Uplander felt as if it was one sharp-left turn away from falling to bits right on the roadway. I'm a Honda owner, and if this particular Uplander was my only exposure to an American car, my assumption -- and a justifiable one at that -- would be that Detroit is still building crap.
Now, as luck would have it, we piled into the Uplander on our first evening after getting it only to find that it was crawling with ants. After a very entertaining ride back to the airport, an apologetic Hertz staffer swapped our bug-infested Chevy for a Toyota Sienna. What a difference! Granted, we would have been happy with any insect-free vehicle, but all of us fell in love with the Sienna, which is a thoroughly modern minivan. Though it wasn't quite as roomy as the Uplander, it had a nicer interior and was infinitely better to drive. If the rental Sienna was my only exposure to Toyotas, I'd come away thinking that perhaps I should consider a Toyota as my next car.
Naturally, the rental car companies are looking to maximize profits. They can only charge so much for a mid-size car, regardless of whether that mid-size car is a top-of-the-line $30,000 Pontiac G6 GXP or a stripped-down $19,000 Pontiac G6 Value Leader. To help them out, the domestics often relegate older models, such as the previous-generation Chevrolet Malibu (now badged the "Classic"), to fleet-only sales. The result: The domestic cars on the rental fleets are often the crudest and cheapest models Detroit has to offer.
That needs to stop, and the automakers know this -- which is why they are trying to wean themselves from fleet sales. But instead of totally bailing out of fleet sales, perhaps the automakers should work up a deal with the rental car companies whereby their fleets are stocked with cars like the Chevrolet Malibu, Cadillac CTS, GMC Acadia, Buick Enclave and Chevrolet Corvette -- cars that represent Detroit's best work. And not cheap models, either -- they should be top-of-the-line models with stain-resistant leather interiors and lots of electronic goodies. Furthermore, the automakers should develop maintenance agreements with the rental companies to ensure these cars are well cared for and kept in tip-top shape. Yes, such a program would cost the automakers more money than continuing to sell (or not sell) cheap has-been models -- but I think it should be viewed as a long-term investment that could pay off in positive PR and increased consumer sales.
During my vacation, I saw a surprising number of import rentals -- Subaru Imprezas, Toyota Yarises and even Audi Q7s -- so I'm sure we weren't the only travelers who got a positive impression from our rented foreign car. Why should Detroit let this opportunity drive on by?
Reducing sales to rental fleets isn't the answer if those remaining sales represent Detroit at its most mediocre. Give travelers the opportunity to rent good American cars, and maybe more of them will want to buy American cars. -- Aaron Gold
