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Tourists in Hawaii are renting U-Hauls because cars are hard to find and expensive

  • Author: Mark Ladao, The Honolulu Star-Advertiser
  • Updated: 3 days ago
  • Published 3 days ago

A near empty Waikiki Beach Oct. 15, 2020, in Honolulu. (AP Photo/Marco Garcia)

HONOLULU — A rental car shortage that drove up prices during spring break has persisted into May and is likely to keep prices high for several more months.

At Lucky Owl Car Rental, which operates out of a Mapunapuna Street office and parking area near Daniel K. Inouye International Airport, requests for a car in its 175-vehicle fleet grew significantly from February to around mid-March—around the peak of spring break in the U.S.

“We ourselves are probably turning away 100 customers plus a day because we’re getting that many requests for cars, " said Tom Pirog, a manager at Lucky Owl. “Our quote request doubled or tripled around that time (spring break ) ... and it’s been that way pretty much since the second week of March.”

Fielding hundreds of quote requests daily, Pirog said the company just doesn’t have any vehicles left to rent out, and reservations are being made three months in advance.

It’s a reversal of what happened last year.

“During the COVID months we had nothing, " Pirog said. “Ninety percent of our fleet was parked. When you run a business like ours, you expect 50%-75% of your fleet to be rented out at all times.”

Jasmine Sasaki-Henry, rental manager of Aiona U-Rent a Car in Hilo, said utilization — the usage of the vehicles in the fleet — is currently at about 100% after being around 40% prior to spring break.

Mathew Simons, a manager of Kihei Rent a Car on Maui, said the company received 8,000 calls for rental vehicles in March. Reservations are being made months in advance after having a 5% utilization rate during the virus outbreak.

“Our phone just doesn’t stop ringing, but it’s a great problem to have, " Simons said.

The growth in business can be attributed to increased tourism, but it may also be a result of a shortage of rental cars at major rental companies, which sold 770,000 rental vehicles in 2020 as demand plummeted, the Washington Post reported.

But restocking the inventory is now an issue because a has slowed vehicle production.

Some believe it will take months before vehicle fleets for bigger companies are fully equipped, leaving smaller, locally operated businesses with more clients in the meantime.

The increased demand for transportation has extended to companies like Cruzin Hawaii, which rents out mopeds, scooters and motorcycles out of a store in Waikiki.

Manager Alycia Aurio said she’s turning away customers because all 100 or so vehicles in the fleet are being reserved every day, and some customers are families with children who come to Cruzin Hawaii because they can’t find rental vehicles elsewhere. But sometimes their children are too young to use mopeds or scooters, so Aurio has to turn them away.

“Before, we would barely have it. Maybe once a week or once every other week, we would have people coming in asking if their kids can ride on (a moped ) or ride one on their own, but around spring break ... it became like every day,“ Aurio said.

Even small rental companies like Van Rentals Hawaii, which opened in 2019 and has just seven 12- or 15-passenger vans, are finding their vehicles booked months in advance.

Customers have even turned to moving companies like U-Haul that allow customers to rent out moving trucks and cargo vans to get around. Hui Car Share, which has 150 vehicles at 65 locations around Oahu, has also noticed more use of its services as well.

Taxi services on Oahu have had a difficult time keeping up with a jump in ride requests, as well.

Dale Evans, CEO of Charley’s Taxi, said customers can wait as long as 45 minutes for their taxis, and Howard Higa, president of TheCab, said dispatch calls to pick up customers has increased threefold.

The uptick in business isn’t all good news, and local businesses are scrambling now to keep up.

Evans and Higa both have a reduced workforce now compared with before the coronavirus arrived in Hawaii early in 2020.

Evans is down to 62 drivers from about 200. Higa said he used to have about 500 drivers but is now down to about 200, and said he earns a profit only if he has more than 250 drivers or so.

Both said their drivers don’t have an incentive to return to work, either because unemployment benefits provide enough or because they are still worried about being infected by the coronavirus.

One of the biggest issues for Lucky Owl right now is registering and getting license plates for new vehicles it wants to add to its fleet. Coronavirus-inspired restrictions have resulted in long wait times—sometimes one or two months—for appointments, and only two vehicles per appointment can be serviced.

Sava Mankovskiy, owner of Lucky Owl, said he’s been turned away as a walk-in customer even though city offices are empty, and has called the experience a “nightmare.”

“If we wanted to bring a new vehicle into the fleet this past year, what we needed to do was make an appointment. And that car, there’s no place to put it. It can’t be on the street, because it has no license plate, " Mankovskiy said.

The city Department of Customer Services did not respond to comment for this story.

Meanwhile, the state Department of Commerce and Consumer Affairs is investigating potential price-gouging of rental vehicles in Hawaii.

“The car rental industry is trying to recoup its losses, and at least they claim it’s being driven by supply and demand because they don’t have the adequate supply right now, because they sold off a large segment of their car rental industry, " said Stephen Levins, executive director of DCCA’s Office of Consumer Protection. “And we’re just concerned about the dramatic increase in the price, and we just want to determine whether it’s justified.”

Levins said the office is investigating whether companies are adhering to Hawaii Revised Statute 480-2, which concerns “unfair methods of competition and unfair or deceptive acts or practices " in businesses.

Pirog mentioned competitor prices hovering around $300 per day.

Nichole Pike, a Cruzin Hawaii customer who rented out two motorcycles on Sunday, said she also rented out the last SUV at an Avis Rent a Car at the International Marketplace big enough to fit her entire party. She was initially quoted around $145 for a 24-hour rental, but with a military discount it dropped to about $117.

Pricing models for local businesses vary, including some with flat rates, but all said they’ve been undercutting the high rental costs of major rental companies.

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