Jan 2006

This story, written with the average car rental customer top-of-mind, was published in the August 2005 issue of SAWUBONA, SAA’s prestigious in-flight magazine.

Even for seasoned travellers, there are some lessons to learn …

South Africa’s car rental operators trade in a highly competitive industry, utilising a fleet in excess of 30 000 vehicles to conduct almost two million rental transactions each year. At peak periods at Johannesburg International Airport – Monday or Tuesday mornings, for example – SAVRALA car rental member companies rent out well over 1 000 vehicles. This requires a great deal of planning and control and, more importantly, extensive vehicle quality checks to ensure that their customers’ safety comes first.

SAVRALA fleets are utilised and generate daily revenues for just under 80% of the year. The average vehicle age is about six months and generally, these vehicles are sold off after around 12 months on the road – or less.

Understanding the rental contract and risk
Seasoned travellers and businessmen are generally very familiar with the speed and ease with which car rental contracts are signed off. It is important, however, to understand some of the risks which may arise when renting a vehicle.

Waivers (cover) options
In 2004, car rental companies in South Africa spent in the region of R300-million to repair and replace damaged and stolen vehicles. This is an industry that is self-insured and, understandably, its operators require their vehicles to be returned in the same condition as when rented, failing which all expenses incurred through damage or loss are passed on to the renter. This is termed Renter’s Responsibility.

To reduce this responsibility, car rental operators offer a selection of waivers, often (incorrectly) referred to as insurances. If accepted and signed for, in the event of an accident or theft, these optional waiver charges will reduce the renter’s responsibility for the expenses incurred, to a maximum excess (or non-waivable) charge or the actual repair charge – whichever is the lower.

Waivers can be taken for accident damage and/or theft. Within both damage and theft waiver options, there are generally two tiers of cover (or excess charges) available. While Standard Waivers attract a higher excess or non-waivable charge, a substantially lower excess charge is levied when taking Super Waiver cover.

Always check the waiver options, resultant charges and cover applicable with the rental staff member at time of rental.

When you are not covered 
By accepting one of the waiver covers, remember that you are not covered if:

• You allow a non-listed person to drive the rental vehicle. Do not even allow hotel valet parking service attendants to drive or park your rented vehicle.

• Your rental vehicle is ‘overdue’ for return. Always ensure that you return the vehicle within the same day that it is due back on the rental agreement. In the event of an accident or theft beyond the agreed return date, you will lose all waiver cover protection.

• You have transgressed the law by speeding or driving over the legal alcohol limit, for example.

• It can be proven that you have been negligent, driven off road or subjected the vehicle to general abuse.

As there are often a number of other restrictions and liabilities that may apply, car rental customers should always check and understand the pertinent aspects of the car rental contract at the time of rental.

To enable the car rental customer to more easily draw comparisons pertaining to car rental terms and conditions between different SAVRALA members, the industry is looking to standardise the main headings of each section’s clauses. Due to anti-competitive legislation, however, the industry may not standardise on all rental terms and condition clauses.

What are these extra charges?
You can be sure that you are buying in a highly competitive environment when all extra services and requirements carry additional charges.

This certainly applies to the car rental industry and rightly so. Instead of hiding all additional service charges in the daily and kilometre rate charges across-the-board (paid for by all but enjoyed by few), car rental operators will generally charge the renter for services as and when they are requested.

This often leads to a couple of extra line items on the rental invoice. Here are some of the additional charges you can expect to find on car rental contracts:

• 24-hour daily charge – daily charges for car rental run for 24 hours from the time the vehicle was rented (often with a one-hour grace on return). When taking a vehicle at 10h00 on a Monday and returning it at 12h30 on a Wednesday, for example, this equates to a three-day rental and not two, a common misunderstanding that often gives rise to invoice queries.

• Additional drivers fees are applied by most operators when there is more than one driver listed to drive the rental vehicle. This is not insurance, so, if you are externally covered, it is paramount to indicate when there are additional drivers required. Accidents/theft involving non-listed drivers will render all Waiver cover null and void.

• Delivery and collection charges will be levied on rental customers who request that their vehicles be delivered/collected at hotels or offices for example. When providing this service, there are significant additional costs relating to manpower and driver collection vehicles and, as such, the charges will vary according to the distance travelled. Generally, extra charges are incurred after hours, on public holidays or over weekends.

• Baby seats and other fitment charges.

• Accident administration/claim handling fees apply in cases of vehicle damage or theft irrespective of what level of waiver has been taken. They are used to cover administration costs such as claims processing, third party queries and assessors’ fees.

• Traffic fine administration fees apply when there is a traffic fine linked to the rental contract. This fee does not replace the fine amount which the renter must settle directly with the relevant traffic authority.

• Valet/cleaning fees apply when a rental vehicle’s interior has been soiled or marked beyond the levels of soiling which occur with normal use.

• A rental contract fee and tourism levy (1%) are minor additional charges which apply to all rental contracts.

Playing it safe
One aspect of car rental common to all operators is the general rush and speed at which the rental experience takes place. Unless, of course, the rental customer is on holiday or in ‘leisure mode’.

All too often, the renter rushes to collect the rental vehicle and races off to meet a tight business schedule. And, the rush is still on when he or she returns to catch the flight which is boarding as the car rental vehicle is being parked.

Despite the fact that all this rushing around and ‘cutting it fine’-type stress is bad for your health, it may also give rise to problems relating to the car rental experience.

When renting a vehicle, it is wise to first familiarise yourself with the ‘foreign’ vehicle and the environment that you are moving into.

Before you get in, check the vehicle’s exterior for any damage. Take a few minutes to establish the location of the vehicle’s controls, adjust the seat and mirrors to your comfort and check your map to assure yourself of the route you intend to take.

On your return to the airport, plan your diary to allow a few minutes to return your vehicle to the car rental company’s designated parking bays. Once again – and in tandem with the car rental company attendant – check the vehicle for damage. Damage to rental cars frequently occurs in parking lots and you may not even be aware of it, so this is an important check to make.

Car rental is a link in the travel chain that can influence your overall experience. It is, however, the link that attracts some risk when ignoring the factors listed.

The vehicle you are driving – or garaging whilst asleep or attending meetings – has a high value and it is in your care for the duration of the rental period. Experience shows that if you follow the SAVRALA’s suggested guidelines and treat the car rental vehicle ‘as if it were your own’, chances are the experience will be a pleasant one with no unexpected surprises or charges.