Zipcar Expands Options Amid Pandemic, Auto Rental Agencies Cut Prices

With auto manufacturers, dealerships, and insurance agencies scrambling to find a way to retain customers during a global pandemic, now is the season of trying new things. Insurance companies have begun offering refunds on premiums for certain people who can’t afford to pay (and aren’t driving) during the health crisis. Automakers are offering heavy incentives on just about everything, cutting additional breaks for those left unemployed. Dealers are swapping to digital sales models to avoid as much direct contact with buyers as humanly possible while still making a sale.

But what are ride-sharing companies supposed to do?

Zipcar has a few ideas. With ride-hailing services and taxi cabs being viewed by many as mobile germ carriages, you wouldn’t expect shared vehicles to be in demand. Zipcar is making a few changes in a bid to make it all the more appetizing. Rather than relying on its typical hourly (or daily) price rates, it has expanded its Dedicated Zipcar vehicle program for weekly rentals. But that puts the business up against traditional rental firms, which have slashed their prices to an almost comical degree.

Already active, Automotive News reported that the program grew this week in the 10 cities it already serves while launching in 14 more. “The coronavirus crisis has created new needs for our members, especially essential employees, who rely on our convenient on-demand vehicles in urban locations,” Justin Holmes, Zipcar vice president of marketing and public policy, said in a statement.

From Automotive News:

Standard Zipcar services allow users to book a vehicle by the hour or day. Dedicated Zipcar provides Zipcar members exclusive access to keep the same vehicle Monday through Friday.

Dedicated Zipcar rates vary by city and include a monthly membership fee, based on market and class of vehicle, plus a $0.45-per-mile fee. The monthly membership fee ranges from $199 to $349, according to Zipcar. A parking spot, gas and insurance are included.

While this will presumably make a few city dwellers very happy, anybody who plans on doing a lot of driving during the health crisis may be better served by traditional rentals or actually owning a vehicle. Dedicated Zipcar’s mileage fee, combined with membership rates, could easily become more costly than a dirt-cheap rental from a brick-and-motor agency — most of which have swapped over to business models that attempt to minimize customer contact as much as possible.

Your author is currently quarantined in New York City, where Zipcar charges $349 per month for its expanded services… and the auto garage that stores my sedan has this guy who keeps on coughing. I could just as easily snag a week-long rental from Avis, Enterprise, Budget, Fox, Alamo, or Thrifty for under 25 bucks a day — and they all come with unlimited miles. The best standalone deal witnessed thus far was $12 per day for a month-long rental on a Toyota Corolla (or similar). That manager special would probably end up being something less desirable once I arrived at the facility in my hazmat suit, of course.

Fortunately, pricing is low across the board, with only premium models and some minivans averaging over $30 per day.

That’s pretty much the case in all metropolitan areas, especially if they’re under some form of regional quarantine. Prices are down across North America as demand weakens. This makes traditional rentals the better option for carless urbanites who may not need an automobile for the full month but plan on doing a lot of driving while they have it. Meanwhile, Zipcar would be ideal for those who need to avoid mass transit on a daily basis but don’t intend on racking up the miles. For your truly, the tipping point was about 20 miles per day minus the free gas.

Dedicated Zipcar already exists in Baltimore, Boston, Chicago, Washington, D.C., New York, Philadelphia, Portland, San Francisco, Seattle and Toronto. The company said it will shift its national fleet to better serve those markets while also adding Atlanta, Austin, Dallas, Denver, Detroit, Houston, Los Angeles, Miami, Milwaukee, Minneapolis, Pittsburgh, Providence, Sacramento, and San Diego to the mix.

[Image: Roman Tiraspolsky/Shutterstock]