Most corporate travel buyers have policies requiring travelers to refuel rental cars prior to their return, and consultants said buyers are negotiating discounts off refueling charges in other instances.
About two-thirds of 200 corporate travel buyers surveyed by BTN said their travelers must refuel rental cars prior to their return so that high gas prices levied by rental car companies can be avoided. Thirty percent, however, said they either reimburse travelers the inflated refueling cost charged by vendors or have not established a policy around refueling, which car rental consultant Neil Abrams, president of Abrams Consulting Group, said could significantly impact budgets.
"You have to hold your travelers accountable," Abrams said. "If you do 100,000 rentals a year, and you're allowing a third of your travelers to have their fuel put in by a rental company, you could be talking about hundreds of thousands of dollars."
Refueling charges vary by rental company, but all are significantly above prices at the pump. The more modest, applied by National Car Rental and Enterprise Rent-A-Car, run about one-third of the cost above the current fuel price, Abrams said. Others charge as much as twice the current fuel price, he said. CWT Solutions Group managing director of ground transportation Dave Kilduff said Hertz Rent-A-Car last year temporarily relaxed its refueling penalties
(BTNonline, July 1, 2008).Both Kilduff and Abrams said buyers should have policies in place that require refueling. "Rental companies charge what they can," Abrams said. "People don't like it, but it's fully disclosed."
Kilduff said tighter travel budgets have prompted many buyers who have not enacted policies around refueling to look at doing so. "It's an area that was overlooked quite a bit in the past," he said.
Buyers with significant car rental volume also should consider negotiating with vendors to reduce the refueling price, Kilduff said. There are times when refueling is not an option: when stopping for fuel would mean missing a flight, or when traveling late at night in a dangerous area.
The three most common negotiated fueling charges are a flat rate or dynamic rates based on either the local pump price or the nationwide average along with a set surcharge, usually about 75 cents, he said.
"We can actually calculate the number of gallons a year and negotiate a difference," Kilduff said. "You'll get pushback from car rental vendors, but they will negotiate it if you have the volume."
Kilduff said buyers should communicate the option of prepaying for fuel upon rental, particularly when they know refueling will be difficult. In those cases, Abrams said buyers should make travelers aware of how much they'll be traveling and the fuel efficiency of the vehicle. If they have to travel only a few hundred miles in a compact car, he said, they could end up prepaying for a full tank of gas and using less than half during their trip.