Insatiable Ride-Hailing Companies Bite into Rental Car Demand

cars Yury Gubin/Adobe Stock

Spend Matters welcomes this guest post from Kayla Bruun, senior economist at IHS Markit.

Despite the seemingly favorable demand-driving conditions of a robust job market, low fuel prices and an upward trend in domestic travel spending, rates for U.S. passenger rental cars as measured by the producer price index have declined 31% since the third quarter of 2014. Concurrently, rising fleet costs attributable to a supply glut in the used car market are overwhelming rental car firms' cost savings from automation initiatives and low gas prices. This suggests that rental car prices are falling due to a mismatch between supply and market demand, not as a result of lower input costs flowing through.

Afternoon Coffee: Takata Files for Bankruptcy, Canada Faces Marijuana Shortage

Japanese airbag maker Takata filed for bankruptcy protection Monday following the enormous recall of its defective product that killed at least 16 people. Demand for pot in Canada currently outstrips the available supply, with some concerned that the lack of product could ultimately push off the start date for the legalization program. Afternoon Coffee brings you the latest in procurement and supply chain news.

Business Intelligence to Transform Procurement