The price of renting a automobile in California might be costlier for shoppers underneath state regulation that went into impact in January.

The regulation, signed by Governor Gavin Newsom, handed by means of the Legislature, with just about no opposition amongst lawmakers. This permits rental firms to cost for extra drivers, though it exempts the renter’s youngsters, siblings, mother and father, and grandparents. For instance, Hertz costs $13.50 per day for every extra driver, with a restrict of $189.

Beneath the regulation, rental firms can cost twice the quantity of their extra driver price if it learns that the rental automobile was pushed by somebody who was in a rental contract, based on a legislative evaluation of the regulation. or was not licensed to drive it by means of price cost.

The regulation has raised the present restrict for the non-obligatory collision harm exemption from $11-$17 to $25.

Automotive rental firms backed Meeting Invoice 901 because it moved ahead within the legislative course of final 12 months, hailing it as minor aid to an trade battling the pandemic. However client safety advocates say assist for the regulation was constructed on a false narrative and ends in a larger burden on shoppers to pay attention to “price creep.”

“The rental automobile trade is telling a tragic story that’s not true,” mentioned Robert Herrell, govt director of the Client Federation of California. “In the event you have a look at the info about (automobile rental) profitability, it is nearly at an all-time excessive.”

Like different industries, automobile rental firms noticed dramatic valleys and peaks in the course of the pandemic.

Demand fell to an all-time low in spring 2020 in the course of the first shelter-in-place order, solely to rebound considerably in the summertime of 2021 as journey exercise spiked amid rising vaccination charges. Many automobile rental firms offered automobiles throughout this time as a cost-saving measure. However they’re struggling to rebuild their fleets as a consequence of chip shortages from automakers and supply-chain disruptions associated to the pandemic.

In consequence, common rental automobile charges nationally rose above $100 final summer season, based on Hopper’s knowledge. Whereas the nationwide common fee rose to $53 a day on the finish of 2021, costs stay above pre-pandemic ranges and shoppers usually take longer to order the automobiles they need. Business specialists have warned to not count on any worth aid this 12 months.

A brand new California regulation permits automobile rental firms to cost for extra drivers.

Paul Chin/The Chronicle 2020

Rental firms can now additionally improve the price for collision harm waivers to $25, and not have to supply rearview-window notices to renters, explaining that the exemption is non-obligatory, which the businesses mentioned is essentially ignored by renters. Is.

Meeting member Lisa Calderon, the invoice’s writer, and lobbyists representing Hertz and Enterprise advised a state Senate panel final June that the invoice would assist a struggling automobile rental trade get well from the pandemic.

A spokesman for Calderon, D-Whittier (Los Angeles County) didn’t reply to a request for remark. Calderon advised state lawmakers final summer season that the invoice is meant to “modernize state legal guidelines governing the rental automobile trade.”

“The COVID-19 pandemic has taken a toll on this trade, with airport rental revenues down almost two-thirds for the reason that begin of the pandemic,” Calderon advised Senate Judiciary Committee legislators. “Sadly, the present regulation imposes some unreasonable restrictions that don’t make sense in 2021.”


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