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Business Travelers Often Skip The Rental Car, Use Uber Instead

Jan 21, 2016
Originally published on January 21, 2016 3:21 pm

Business travelers increasingly are relying on Uber and other ride-hailing services, often more than car rentals or taxis, according to new data.

Say you land at Chicago O'Hare International Airport. You've got a work meeting 20 minutes away. You might head to the rental desk to pick up a car. Or, you might call an Uber instead.

"More transactions coming through our system are in Uber than there were in all the rental car transactions," says Bob Neveu, CEO of Certify, a company that businesses use to book travel and track receipts.

Certify analyzed millions of client transactions, and in the last quarter of 2015 Uber represented 41 percent of total rides, rental cars 39 percent and taxis 20 percent. (The analysis does not include Lyft rides, which grew more than 700 percent over the last year but is still a fairly small portion, according to Certify data.)

"So if you think about it as a simple popularity contest, Uber is much more popular than using rental cars or taxis," Neveu says.

While ride hailing has put some cabs completely out of business, Neveu doesn't think rental cars face the same fate. "There's always going to be a need for that marketplace when you have to drive longer distances, farther away," he says.

Technology analyst Alexandra Samuel says the car rental industry needs to catch up: People don't want to be locked into a reservation days in advance. They want convenience (an app that knows your credit card number, not a form that makes you type it); they want to write emails in the car.

Samuel says incumbent companies — take Hertz, for example — should consider offering rentals that come with drivers. And she asks, "Why do I have to go to a Hertz parking lot and pre-book and make sure there's a car there? Why can't I just use a Hertz app and find a Hertz car anywhere in the city?"

Automakers are moving in that direction. General Motors plans to announce Thursday that it's rolling out a new car rental service called Maven, starting in Ann Arbor, Mich., where customers can use smartphones to reserve nearby cars and get in without keys.

Earlier this month, Lyft announced a new partnership with General Motors that includes a new service for Lyft drivers to rent vehicles, instead of using their own.

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DAVID GREENE, HOST:

And we are learning more about why ridesharing companies like Uber and Lyft are so popular. There's new data suggesting that suits - professional people - are relying on these services heavily - so heavily, in fact, it's becoming the new normal, as NPR's Aarti Shahani reports.

AARTI SHAHANI, BYLINE: A new normal, as in replacing an old normal. Say you landed at O'Hare Airport - Chicago. You've got a work meeting twenty minutes away. You might head to the rental desk to pick up a car, or you might call an Uber instead.

ROBERT NEVEU: More transactions coming through our system are in Uber than there were in all the rental car transactions.

SHAHANI: Bob Neveu is CEO of Certify, a company that businesses use to book travel and track receipts.

NEVEU: So if you think about it, it's a simple popularity contest. Uber is much more popular than using rental cars or taxis.

SHAHANI: Certify has analyzed millions of client transactions. That's all business travel. And in the last quarter of 2015, rental cars were 39 percent of total rides, compared to Uber, which was 41 percent - two points more. Taxis lag behind at 20 percent. While ride hailing has put some yellow cabs completely out of business, Neveu doesn't think that rental cars face the same dark fate.

NEVEU: There's always going to be a need for that marketplace when you have to drive longer distances, further away.

SHAHANI: Technology analyst Alexandra Samuel says the rental car industry needs to catch up. People don't want to be locked into a reservation days in advance. They want convenience - an app that knows your credit card number, not a form that makes you type it in. They want to write emails in the car. Samuel says incumbent companies - take Hertz, for example - they should consider offering rentals that come with drivers. And she asks...

ALEXANDRA SAMUEL: Why do I have to go to Hertz parking lot and pre-book and make sure there's a car there? Why can't I just use a Hertz app and find a Hertz car anywhere in the city?

SHAHANI: Automakers are moving in that direction. Today, General Motors announces they're rolling out a new car rental service called Maven, starting in Ann Arbor, Mich., where customers can use smartphones to reserve nearby cars and get in without keys. Aarti Shahani, NPR News. Transcript provided by NPR, Copyright NPR.