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Driving a Hard Bargain
By Mitch

Driving a Hard Bargain (July 2, 2006) -- If you post it, they will come. In March, El Monte RV Inc. quietly opened a satellite office in Reno and started taking bookings for recreational vehicles on its website. Even though it was charging roughly double the rate it asked in the San Francisco area, with prices over $5,000, El Monte sold out its small inventory for the Burning Man period “almost immediately,” according to Joe Laing, a company spokesman.

“We didn’t think it was going to be very big,” Laing said. Yet with only five vehicles initially available, the selling out should not have been a surprise. The company rents hundreds of RVs to Burners each year, Laing said. Unlike some of its competitors, the company likes the idea of the event, although none of its employees have ever attended. Laing noted that late summer is a busy time for RV rental agencies.

In addition to Burning Man, there are two big NASCAR races over the Labor Day weekend near El Monte’s home base in Southern California, and these are popular with RV renters, Laing said. Burning Man and NASCAR put a strain on El Monte’s resources, which show up in pricing that may strike Burners as unfair or, in the case of Reno, absurd.

“We are not gouging,” Laing said. “We have to make money. We are trying to still make availability.”

While the annual pilgrimage to Black Rock City may be central to Burner planning, other RV renters have different goals. What this means for companies that rent RVs is that all of a sudden in the late summer, there is a lot of demand for vehicles in California. El Monte’s web site shows that it has 10 locations in California out of 31 nationwide, including 10 on the East Coast. El Monte’s problem is that late in August, it has a lot of demand in two specific places but its RVs are scattered across the country. Not only does it have to get its vehicles to those offices, it then has to figure out how to redisperse them to its other locations afterwards, either via one-way rentals or by hiring people to drive the rigs. There’s also the labor-intensive question of cleaning RVs that have spent a dusty week on the Playa.

Somewhere, Adam Smith is smiling. El Monte sets its rates at levels that make it worth its while to get RVs to where they are wanted. Which is why, if you wanted to rent a 26-foot, Class C RV in Reno (the smallest size available via the website) from August 27 to Sept. 5 of this year, the base rate was $5,921 in mid-May. Taxes, insurance and mileage are additional. The same size vehicle in Oakland would set you back $2,721 but would cost just $1,701 in Las Vegas.

If you are coming from California, your choices are limited, but Burners arriving from elsewhere would be smart to rent an RV in places like Las Vegas, and Salt Lake City, adding a few extra days to the contract but still paying hundreds or thousands of dollars less overall.

Laing had a few additional tips for Burners who want to rent RVs, either from El Monte or one of its competitors. One was to rent as early as possible. El Monte employs the same kind of yield management system that airlines use, which adjust prices in response to early demand. As the rental date gets closer, rates go “higher and higher.” It also might be worth negotiating a one-way rental. Once Burning Man and NASCAR are over, it’s the fall season, and national RV companies may want to move their vehicles to warm-weather zones like the southwest. So Burners coming from the Northeast and Midwest might find it cheaper to rent in their home towns and drop their units off in Nevada or California, flying home, than to book a round trip. It’s worth calling the rental company office and asking if they have any one-way deals, since these aren’t always listed on web sites.


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