She Bangs: Car-hire prices

They're still banging on about the price of car hire, as they'll no doubt bang on about it throughout the coming season. But some of the banging-on and some of the messages are curious. At the weekend, "The Bulletin" dragged out some website report advising early booking for the Whitsun period - to avoid "peak prices ... evolving from the high demand". This report then went on to say, as though it was stating something new, which it most certainly wasn't, that a reason for high prices is the reduction in car fleets. Yes, well I think we knew that, thank you very much, as in we knew this last year as well as this. Big deal. Elsewhere in the paper, a lady was doing some more banging-on: another cup of coffee and another expensive car for hire. Ho hum. Ever the anecdote, ever the inconsequential.

However, just read those quotes again. Something doesn't necessarily chime with all the banging-on that has brought forth dire warnings of visitors fleeing Mallorca and heading for havens of low-cost car hire (if any such place exists). That something is "high demand". Well, if there is high demand, then are people being deterred by prices? It would appear not. But what about these prices? The report is quoted as saying that one could expect to pay "even as much as 136 pounds for a car rental in the Mini-category" - for Whitsun week. Even as much as? The price doesn't sound that excessive, certainly not in the 7000 a week for a small car that Harry Goodman surely didn't pay but was said to have done, or the 700 a week that one presumes the paper actually meant to print. Hyping up "hikes" in prices when the prices do not appear to be unreasonable seems distinctly strange: me suspects the exaggeration of a so-called and self-congratulatory "campaign".

Then there was something even stranger in yesterday's "Diario", because it went against the whole justification for these alleged hikes - that reduction in car fleets. The headline said that there had been a rise of 214% in Balearic car registrations (during March), a record for Spain. The by-line added that the Balearics were leading the way in the increase in car sales thanks to - "the renewal of car-hire fleets". Record sales, renewal of fleets; strange and very interesting. It's very interesting because, assuming this to be correct, then the price-increase justification through limited supply is undermined, leaving one to conclude that, if there are indeed excessive prices being charged, then this may well be the result of agencies pursuing a bit of profiteering - as has been alleged by the banger-on-ers. Maybe. It might rather depend on how many and which agencies have been engaging in the purchase of new vehicles.

Unquestionably, there are now conflicting messages emerging. On 3 March (Keep The Car Running), I reported that the word was that there would be a fall of 5,000 hire vehicles this year. However, the total number of sales in March alone was not far short of that figure and this was made up, in large part, by those to agencies (albeit that no precise figure for agency sales has been given); total sales for the whole of the first quarter have risen by over 100%, equating to over 8,000 vehicles. There are factors driving, as it were, car sales, one of them being the rise in IVA (VAT), planned from 1 July.

The sales figures place a different complexion on the car-hire story. And if one takes that report, maybe what we have is evidence not of a market going belly-up but one that is actually rather buoyant, enjoying "high demand" and at prices, quite frankly, that are not excessive, because there is in fact more supply around than was being predicted. One waits, with interest, the further banging-on and criticisms regarding old bangers.


QUIZ:
Yesterday - Brilliant (with video supplied by shum65).
The Cocteau Twins, "Five Ten Fiftyfold" from the "Head Over Heels" album:



Today - cracking Latino song, though I suppose it might seem a little ironic now.

Any comments to andrew@thealcudiaguide.com please.