The introduction of the Ford Model T as the first mass produced car is closely linked with the car hire industry. A mere eight years after the first Ts rolled of the production line an enterprising Nebraskan businessman called Joes Saunders started a car hire firm with one car. The main focus of his business was the travelling salesman market, although his first customer is believed to be a man who wished to take a girl out on a date.
Two years after this original foray, a young entrepreneur, Walter L. Jacobs started a company in the Chicago area. The car rental firm was founded with a dozen Model Ts with Jacobs carrying out all of the repair and maintenance work himself. The success of this business was outstanding and within five years it is believed that it was generating an annual income of one million US dollars.
The success of Jacobs’ car rental company did not go unnoticed by investors; most notably John Hertz. Hertz already owned the ‘Yellow Cab and Truck Hire Company’ and used his funds to buy out Jacobs’ car hire firm. Hertz himself was then bought out by the General Motors Company who re-branded the company as the ‘Hertz Drive-Ur-Self System’. Hertz is still a major player in the car rental industry and most probably the company with the most history.
The early years of the car hire industry were dogged by involvement with organised crime. The Prohibition years saw bootleggers and robbers frequently using car firms for ‘jobs’ and led to the industry gaining a poor reputation with the public. The ending of Prohibition allowed the industry the freedom to distance themselves from the criminal fraternity and rebuild a respectable reputation.
The expansion of the American rail network acted to bolster the car hire industry for a number of years. Purely rental car parking was created at some stations to further entice customers, mainly due to Railway companies heavily investing in franchises. Rail companies also started to create a service where customers could order a hire car in advance of their arrival at stations using the telegraph network.
In the post war period the car hire industry grew rapidly, being linked to another form of transport; in this case however it was no the railroads but instead the rapidly expanding air travel market. Car rental companies began to open franchises at airports to allow passengers vehicular transport at their arrival destination. The term ‘fly-drive’ became popular and supplied a service to tourists and businessmen alike.
Competition in the car hire industry since this time became fierce, with many companies employing aggressive advertising campaigns with the help of the airlines themselves. Today airports are still a major source of revenue for companies, with desks filling many arrival lounges.
The modern era of car leasing has seen companies face increasing competition from improved public transportation links. Most major airports now have a direct rail link with their host cities while coach and bus companies allow travellers to reach almost any destination once they have left the airport. Businessmen are still integral to the industry, as much as it was for Saunders’ original firm, while the innovation of ‘fly-drive’ holidays has opened a wider market.
Car hire companies are increasingly employing satellite navigation systems in their cars making travel easier for customers. The addition of high-tech security systems such as fingerprint scanners have also been employed to secure fleets. For companies to survive in this highly competitive industry they must be innovative and provide a service that is unrivalled. With prices increasingly forced down by rivals the customer now faces possibly the widest choice ever in the history of the industry.