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SALT LAKE CITY – Uber, Lyft and similar companies have had it especially rough during the COVID-19 pandemic. But while their industry lost billions over the past year, another industry is picking up the slack — car rentals.
The rental car industry was crushed when everyone suddenly stopped traveling due to the coronavirus pandemic. At that time, rental car companies had been losing customers to ride-hailing companies. But as the pandemic unfolded, more and more of us wanted nothing to do with shared transportation.
"But unfortunately, we're still not done with it," said data writer Andrew Hurst of LendingTree. He analyzed data from 110,000 transactions and found that "rideshare usage, like Uber – that sort of thing – dropped 69% in 2020, compared to the year before."
And that drop translates to huge financial losses. In February, Lyft reported that it lost $1.8 billion in 2020. Uber lost nearly four times that number at $6.7 billion.
But people still had places to go and our reluctance to rideshare eventually opened a door for rental car companies and they stepped through.
"The use of rental cars or trucks rose by 143%," said Hurst.
He believes that trend will continue, as travelers still opt for an individual car rental over ride-hailing once they arrive at their destinations. Plus, road trips have become hugely popular for escaping cabin fever.
"I wouldn't think that they're hurting," Hurst said the rental car companies. "Especially in somewhere like Utah that does have really great natural tourist attractions like the (national) parks."
When COVID-19 first hit, to stay afloat, rental car companies like Avis and Hertz sold off tens of thousands of their cars. So now that demand is picking up, industry experts are warning of a rental car shortage in the months ahead. Your best bet is to book your rental car as far in advance as you can.