An early return, a higher price

Q: We recently booked a rental car for 10 days through Alamo.com. Unfortunately, my husband’s grandmother passed away while we were on vacation and we had to come home three days early.

A few days after our return, I discovered my credit card had been charged more than triple the price that Alamo had originally quoted us. The early-return policy on Alamo’s Web site says something about a fee of $15 per day for early returns, but our weekly rate was raised from $152 to $513.

My husband and I were not made aware of the higher charge when we returned the car. We did not authorize it or sign a receipt agreeing to pay that amount.

Alamo claims that we broke our contract when we returned the car early, but I feel this is a classic case of bait and switch. Do I have any recourse in this matter?

– Molly Reinhardt, Kawkawlin, Mich.

A: Raising your weekly rate by $361 because you returned your car three days early makes no sense. If anything, Alamo should be offering you a refund for bringing one of its vehicles back early, thereby allowing the company to rent the car to someone else.

But that’s not the way it works. Two years ago, Alamo made a small but significant change to its return policy. Not only would it apply a $15-per-day early-return fee, but it would also recalculate your rate, charging you the same price that walk-up customers pay to rent a car without prior reservation. In other words, you would owe Alamo the penalty plus the rate difference, which in your case is an extra $361.

The Alamo policy is similar to airline rules. A fare booked two weeks in advance is almost always cheaper than a walk-up fare, but if you change your plans, you’re subject to a rebooking fee.

You could have prevented this excessive surcharge by carefully reading the terms of your rental contract and asking about the early-return fee when you made plans to go home early. If you had asked, you might have been able to explain your situation to a manager, who would almost certainly have adjusted your rate in a more compassionate way.

I contacted Alamo on your behalf. Regina Barr, a senior customer services manager, said that under the circumstances, Alamo would honor the original weekly rate. The company has issued a refund.



  • Alamo customer

    Pray tell, would it not have made sense to deliver the car to the Alamo lot, hand over the keys, tell them that you will not be using it for the next 3 days and you feel safer leaving it in their lot rather than at the airport?? Alamo made a stupid move on that one and I for one will certainly be looking elsewhere if that is what Alamo feels is the way to build customer confidence. So charge me the the contract rate and be glad you get the opportunity to double the rate on a car!!! Duhhhhhh.

  • I used Alamo once – never again

    I rented a car from Alamo a number of years ago, and the agent gave me such a hard time about not taking the add-on insurance, that I vowed never to rent from then again. He told me that it was stupid for me not to take it, and that I’m going to be responsible for whatever happens.

    I have not rented from Alamo since.

  • The Other Chris

    Chris: Usually when people write to you about their woes because they didn’t fully read the T&C, I disagree with the action you take and the refunds you secure them. Customers are responsible for knowing about things like no-show policies, baggage restrictions, or be willing to work with airlines, hotels and rental car companies in the event that their overbooking practices (which are often necessary to ensure a profit) come back to bite them; often, customers do not want to accept fair or even generous compensation and want the companies to magically conjure up things out of thin air that they just can’t do. Crap happens, people–quit your whining.

    But in this case–and as a rental sales agent–I fully say that Alamo is in the wrong. First of all, it is nearly universal across the rental car industry to be pretty generous to the customer when it comes to changing plans: no cancellation or no-show fees, extending the same rate if the customer needs the vehicle longer than planned, and not penalizing the customer if they return early. (Some companies do charge for cancellations or no-shows–Alamo might be one of them–but most do not.)

    With every other company that I’m aware of, if a customer makes a reservation for two weeks and only keeps the car for one, the customer only pays for one week. The rest is refunded back to their credit card.

    I can understand Alamo’s logic here–an early-returned car loses revenue. It’s not guaranteed (or even likely) that another customer–walkup or reservation–will actually rent that car and make up for the lost revenue. It’s important to note that rental car utility and availability is not an exact science and therefore is not planned in an exact manner: because so many people simply do not show up for their reservations, without overbooking, there will always be leftover cars and lost revenue. The yield managers keep the reservations flowing in until it looks like there’s a good balance between on-rent cars and available cars for the reservations–95% utility is a great, if tight, goal. Basically, what I’m saying is that there is no way to say that by returning that car early, someone else specifically will take that car and make up for the lost revenue: it’s likely that reservation would have been taken anyway and honored in one way or another. In short, yes, the rental agency loses money on cars returned earlier than planned, no matter how you look at it.

    However, the no-penalty-for-early-returns has become so entrenched in rental customers’ minds that I can’t fault the customer for not reading this in the terms and conditions and expecting business as usual.

    I can understand Alamo’s position, but not its implementation. Crediting back unused days minus a $15 per day fee sounds reasonable, but absolutely certainly not adjusting the rate to full rack rate so the customer ends up being on the hook for MORE than the original rental! The very worst I’d give the rental agency would be to charge for the entire rental without any refund, but under no circumstances should an early return cost MORE than the original full-length rental. If I were the customer, I’d tell the rental agency to keep it on rent for the rest of the term and not close the contract until the expected due-back date–it would be cheaper that way.

    Comparing this to rebooking a round-trip airline ticket is not a fair comparison, since when you make an airline reservation, you are reserving a specific seat on a specific airplane in both directions. If you change your itinerary, that specific seat must be resold and another one rebooked, hence the fare change. But when you book a car rental reservation, you are not booking a specific car (they don’t assign a vehicle number at the time of your reservation and “This is Mr. Jackson’s car” and not rent it to anyone else: for one, nobody ever returns their cars when they say they will (so it would either sit for several hours or several days or it would be kept late and not there when Mr. Jackson arrives), and second, people often arrive early or late, change their pickup times, upgrade at the counter or otherwise change things so they wouldn’t end up in a specific car even had it been held for them.

    It would be a much fairer comparison to compare returning the rental early to getting off of an airplane early–that is, say you had booked a one-way ticket from ANC-BOS, connecting in DEN. ANC-BOS one-way was $367, but ANC-DEN one-way was $452–that is, it’s cheaper to continue on to Boston. If you book the ANC-BOS but get off in DEN (that was your original destination all alng), the airline can’t bill you for the difference–what would they do, send a collections agency after you or ban you from flying their airline again? No, the best they can do is punish you by canceling your following segments if you were flying round-trip (which they would do), but on a one-way itinerary, they have absolutely no recourse, as well they shouldn’t. Alamo shouldn’t either.

    People have bad experiences with and trash on all rental agencies, and the one I work for sometimes seems to especially the target of a lot of [unsubstantiated] venom (lots of people say, “Don’t ever rent from ___–they’ll screw you over,” although I’ve not seen any proof that we do that any more than anyone else does–not that we should be doing it at all), but this Alamo policy firmly plants them now at the very bottom of the rental industry in terms of customer service. Based on this post, I certainly won’t be renting from them (I have in the past) unless they give me a great rate on a short day-rental and I am completely sure that I will be returning on that same day (as I do occasionally on layovers at airport), which of course means that there is no possibility of me returning “early” or also being penalized for keeping it an extra day (who’s to say that they wouldn’t slam the second day on me at $200 per day?).

    I’m not saying this to start a vote-with-your-wallet campaign: I’m simply protecting myself from any future problems. The solution is to avoid Alamo whenever there is a possibility that this policy could come back to bite you. I’m very disappointed that they chose to do this.

  • Frank Krupa

    I recently retired after 38 years as a field claims representative. Your story on Alamo brings up one of the most irritating cases I handled. It upset me so much that I kept the file till after I retired, in case I crossed paths with them again. Fortunately, I did not.
    Often, in cases of clear liability, we would agree to a certain number of days of rental reimbursement to the claimant and would agree to pay the rental car provider directly. Not so with Alamo. When they entered the picture, we politely withdrew any commitments.
    In my case file, our insured hit an Alamo car and we felt liability was clearly with our insured and we attempted to settle with Alamo. They refused to let us look at the damaged car and would not tell us where it was. They then submitted three estimates, all three on the same forms and in the same hand writing. They said that they had copied three body shop estimates onto their own forms. As I remember, the amounts were about $2800, $3400, and $4100. We declined to pay unless we saw the car. We were refused – but our intrepid staff auto damage appraiser did chase it down and did an appraisal and took photos. Our estimate was about $2800. Alamo then demanded $38 per day loss of use, even though the car was rented for $27 per day.
    By blind, dumb luck, I came across the car in a repair shop and asked the manager what the agreed repair figure was. He showed me (and gave me a copy) of the Alamo check for $2108. I paid Alamo the $2108, – and sent them a copy of their own check to confirm how we arrived at the figure. I also paid them their lost rental profit – using an industry-accepted formula. I never heard from them again.

  • Ryan Lynch

    I recently was charged a $99.99 early return fee from Avis for a 1 day rental. I successfully got the charge removed, but it was a hassle to deal with.

    I rented a car for 1 day from Priceline (a great deal…$12 at SNA). I picked it up at 8am, and was finished with it by the evening. Avis said that the charge was because I wasn’t keeping the car overnight
    and becacuse I rented from Priceline – they said Avis.com customers are exempted from the charge. I checked the contract, and an Early Return Fee isn’t in the contract. Priceline’s Terms & Conditions for
    car rentals don’t mention it either.

    I ended up working with both the Avis staff at SNA (the manager was unavailable) and Priceline to get the fee removed. It looks like common sense prevailed at Avis before Priceline really needed to get involved.

    I understand (kind of) the idea of re-calculating special weekly fares. But this was a lot more than the walk up fare…no one pays $99.99 for a G6 for 1 day. Have you seen anything like this before?

  • Bruce Shafer

    Thanx for the stories, folks. We will definitely never rent from Alamo!

  • Tim Brace

    Dear Mr. Elliott,

    I read your article about the Alamo customer. I am planning on renting a car, and, suffice to
    say will not be using Alamo.

    I feel you are being too easy on these companies. At one point, I tried reading the fare rules
    for an airline online, and the rules were incomprehensible, even for legalese. I talked to a
    customer service agent on the phone and forced them to go through every line and explain the
    jargon. Several times, they could not even understand it or explain it. Further, the rules
    were all in one paragraph with no normal English or line breaks. Yet you refer to this garbage
    all the time. No judge would accept the defense that “it’s in the rules” when the rules are so
    poorly displayed and written.

    It’s clear what’s going on is the companies are exploiting customers because most people won’t
    want to take the trouble, and feel they have no defense. It’s up to you guys to point this out
    and be unrelenting in forcing companies to be clear and to live up to their obligations.

    As you rightfully point out, why shouldn’t there be a discount for returning the car early, as
    the company benefits from it. But it’s just one more example of exploitation and poor customer
    service.

    Sure, we can talk to a supervisor, etc., but that’s just their easy out. The situation
    shouldn’t be there to begin with.

    I am speechless at the poor service I have received online and on the phone. I have often told
    companies that their regular service is often not that bad, but their poor customer service
    when people need to call about a problem will destroy these companies in the long run.

    There seems to be just no concern about customers, perhaps because the economy has been on
    overdrive, no one needs to seek out customers, they have more than their share.

    Thus, the unfortunate fact is the only solution would be a recession, unpleasant as that
    prospect may be. Customers only get treated well when they are scarce.

    I hope you will work even harder to help customers and to change the pitiful service companies
    are offering across the board.

    Sincerely,

    Tim Brace
    San Francisc

  • deecro

    I understand that, as customers, it’s our duty to go through and read the ridiculously fine print and long legal jargon that seems to attach itself to each and every contract. But in terms of the real world, a majority of the people tend to look at you like you’re insane when you actually attempt to do so. And you would think Alamo would have just a hint more tact when an early return is due to a death in the family. If that’s not sacred, what is?

  • Stephen

    I will never rent from Alamo after an experience with them in Hawaii. When I arrived at the rental counter, I was immediately hit with the insurance sales pitch. Since my personal insurance and my credit card cover me, I turned down the extra insurance. Then the hard sales pitch started, culminating with a promise from the agent that “You will not be allowed to leave the islands until you or your insurance pay for any car damages if you don’t take the insurance.” When I asked how they would keep me on the islands, I was told “We know the local police.”

    I made sure to do a thorough inspection of the car prior to rental, and made an agent make note of every scratch, dent, etc. on the car. Sure enough, when I returned it, they wanted money for some scratches that were on the bumper. When I produced the inspection form that noted I rented the car with those same scratches, they dropped the pitch for money.

    I sent a letter to Alamo corporate after I returned home, and received a form letter stating that supplemental insurance was in my best interest, and that Alamo was only trying to make sure I was fully covered in the event of an “incident.”

  • Jennifer Hanuschak

    How can they recalculate a rate you already agreed to? It doesn’t even seem legal to me.