- Major companies admit to not always fixing dents and scratches they charge for
- Avis Budget, Hertz and Enterprise are among those to have been caught out
- Europcar is under investigation for a potential fraud valued at around £30million
Neil Tweedie for the Daily Mail
Europcar has a motto – ‘moving your way’. But rather fewer customers may be moving the car hire giant’s way in future after its offices in the UK were raided by officers from trading standards.
The French-owned firm, Europe’s biggest vehicle rental operator, is under investigation for overcharging as many as half a million customers for repairs by as much as 300 per cent, resulting in a potential fraud that the company itself values at £30million.
It is said to have entered into secret arrangements with repairers, allowing it to pay much less to them than it charges its customers.
The case has highlighted concerns about an industry increasingly characterised by dodgy practices as firms compete in a market made ever more competitive by price comparison websites.
Stephen Stanford, a retired works foreman from Birmingham, refuses to trust any car hire firm nowadays after being charged hundreds of pounds with no justification
If an operator is forced to cut its headline price, then there is always a way to lighten the wallet of the unsuspecting driver.
It might be a last-minute excess charge levied at the pick-up desk, an up-front deduction for fuel or, most egregious of all, inflated demands for damage, much of it trivial or non-existent, or caused by someone other than the customer. Many of the repairs charged for are never carried out.
Car hire is a Wild West industry in which the normal laws of commerce do not apply.
Initial offers are often no guide to the eventual price, and card deposits of up to £2,000 are demanded from customers intimidated into believing they face huge liabilities if an accident occurs.
These threats are levelled by unscrupulous counter staff who often earn commission.
Bogus damage to cars of the kind now being investigated was Roger Bradshaw’s nightmare when he and his family rented from Europcar for a holiday in France
Excess charges can be hugely excessive. In one case uncovered by the Daily Mail, car hire brand Budget levies a staggering £8,416 charge on Mercedes E-Class saloons rented at Faro airport in Portugal.
These near-unaffordable prices are designed to scare customers into taking out additional insurance.
‘The people at the desk use fear sales techniques,’ says Martin Lewis of MoneySavingExpert.com. ‘And I see customers panic all the time.’
On many occasions, a customer throws open their debit or credit card account to a company which can then extract money from it at will and on the flimsiest of grounds.
Once taken, it is a nightmare to get the money back.
As the unfolding Europcar scandal shows, these tactics are not just the work of shabby local operators. Mail readers have complained about the behaviour of car rental giants Avis and Hertz, in addition to Europcar.
As millions of Britons head for the sun, they are being warned to heed the first and last rule of car hire: ‘Caveat emptor’ – let the buyer beware.
Stephen Stanford, a retired works foreman from Birmingham, refuses to trust any car hire firm nowadays.
‘We have a villa in Portugal, which we try to get away to a couple of times a year,’ he says.
‘We hired a car online from Avis and paid for the insurance, but at Faro airport we were told that the insurance was inadequate and if we had an accident it would cost us a lot of money. So, I paid 150 euros for additional cover.
‘The man on the Avis desk counted out the money in front of us, and we assumed it would appear on our paperwork. We did not check this until later, when we discovered there was no record of this extra money being paid at all.
‘One month after we came back from Portugal, I checked my bank statement and found they had taken another 425 euros from my account.
‘I got in touch with the Avis office in Faro straight away but had no joy, as I was told no one there spoke English.
‘After this, I went online and, to my amazement, found advice on the Avis website warning people about hire-car rip-offs. And here they were doing it themselves.’ No reason was given for the deduction and Mr Stanford is resigned to the loss of his money.
When former police officer Steve Tovagliari booked a holiday in Majorca, he was advised by his son to avoid the Europcar subsidiary Goldcar, which is the subject of numerous damning reviews by customers.
So he booked his hire car from a company called Rhodium through the agency Holiday Autos.
‘Imagine my shock when I arrived at Palma airport to find that Rhodium was part of Goldcar,’ he says.
Loss and frustration duly ensued. ‘From the first minute, the lady on the desk, a Bulgarian called Olga, started her sales pitch – from upgrading, to changing to an automatic, to satnav and, finally, extra insurance.
‘I showed her a copy of my UK-purchased insurance, which covered me for £5,000 of damage and stated that I didn’t need any other, but she shook her head and said it wasn’t valid.
Heather Cunliffe, a teacher from Bedford, was on a honeymoon in Spain with her husband, Mike, when her Europcar rental was clipped
‘I am quite a strong character and stood my ground. Some 20 minutes later, with a queue forming behind me, we were still at an impasse.
‘She insisted that without purchasing the insurance she would take a payment of 1,400 euros from my card which, if there was no damage, would be refunded in 30 days. Not an authorisation, but an actual payment.
‘I insisted on speaking to a manager and, suddenly, her perfect English disappeared and she stated that she did not understand what I was saying. I was now tired, the people in the queue were getting restless, and we needed to get to our hotel. It was 180 euros for insurance or 1,400 euros with no guarantee of ever seeing that money again.
‘We had 50 miles to drive and I had no option but to take the insurance, under protest. A large smile returned to Olga’s face, together with her perfect English. It was appalling.’
On his return to Britain, Mr Tovagliari contacted Holiday Autos – with whom his car hire contract was made – but weeks went by with no result. Only when he contacted the Mail and copied in Holiday Autos did the company ring him and promise to return the money.
‘Since the internet has taken over and driven prices down, the car hire companies are finding other ways of making money,’ says Mr Tovagliari.
‘And, of course, the staff make their money from commission – Olga tried to sell me satnav and there was satnav already in the car.’
As Money Mail revealed a few days ago, Hertz is charging up to £204 to hire a TomTom satnav for a two-week break in Europe in August, when a basic model can be bought online for less than £90.
Bogus damage to cars of the kind now being investigated was Roger Bradshaw’s nightmare when he and his family rented from Europcar for a holiday in France.
On arrival at the hire desk at the airport in Limoges, he was told he would have to pay a £1,500 deposit with his credit card, or not have the car.
‘When the representative took me to the car, I started to take photographs of the vehicle, but the rep tried to stop me, saying it was against the law to photograph cars,’ he says.
‘I decided to continue to take photos, much to his protest.
‘Prior to returning the car, I again photographed every inch, both inside and out. The pictures were timed and dated. I filled the tank with fuel at the garage close to the airport.
‘Unfortunately, when I returned the car, there was no one on the check-in desk, so I left the keys in a box nearby, as suggested by a rep from another car-hire company.
‘Having not received my deposit back after a couple of weeks, I contacted the UK base of Europcar, where I had made the original booking.
‘Eventually, I received an email advising me the deposit was not refundable because all the tyres were scuffed, there were several scratches on the front, sides and rear of the car, a front light was broken and the fuel tank was empty.
‘I sent copies of the pictures and of the receipt for the fuel, and suggested if there were problems with the car they occurred after I had left the vehicle. I again asked for my deposit. They refused, despite the overwhelming evidence.’
Mr Bradshaw, a retired driving instructor from Colchester, threatened legal action and received a refund in 48 hours.
British tourists are being billed hundreds of pounds for bogus repairs for scratches and dents on hire cars (file image)
Heather Cunliffe, a teacher from Bedford, was not so fortunate. She was on a honeymoon in Spain with her husband, Mike, when her Europcar rental was clipped.
The other driver immediately admitted liability and even phoned Europcar to inform them.
‘It is clear from the nature of the damage and pictures of the location – which Europcar never asked for – that we were entirely faultless,’ says Heather.
‘However, Europcar deducted about £250 and told us it will not be refunded as the third party was not at fault. They have simply ripped us off.’
Ian Adams fell foul of the dreaded Goldcar during a trip to Spain, despite taking precautionary photographs on picking up his vehicle.
‘When I took the car back [the Goldcar employee] went straight to a mark so small you would not see it in an underground car park,’ he says. Nevertheless, he was charged £250.
A Europcar manager has previously told the Daily Telegraph that the company advises staff to find new damage when the car is returned, and then charge an inflated repair price.
‘The returns team are measured by the amount of damage they find,’ said the whistleblower. ‘The best teams find new damage on one in five returned vehicles. Agents earn £4 per vehicle for spotting damage and can make up to £1,000 a month in peak season.’
Repairs have become a major earner for rental companies in the past five years. Big hire firms can use the volume of work they offer to small bodyshop companies to pressure them into offering reductions on parts, paint and hourly labour rates.
But those savings are not passed on to the hirer of the damaged vehicle, who pays the full market rate. Which some might regard as fraud, pure and simple.
Avis Budget, Hertz and Enterprise, which owns Alamo and National, admit to not always fixing dents and scratches they charge for
Jason Moseley, director of the National Body Repair Association, which represents 850 bodyshops in the UK, says: ‘We would like to see more transparency on repair costs and a fairer deal for our members from the big corporates, which can then be passed on to the consumer.’
Avis maintains that its charges reflect the real cost to the company of repairs.
A spokesman said: ‘We may elect to conduct any repairs following a subsequent rental or at the end of its life as part of the remarketing process.
‘When the car is not returned to the manufacturer and we sell it on the open market, we may choose instead to absorb a reduction in the price.’
Owned by French investment company Eurazeo, Europcar operates in some 140 countries and is valued at £3.6billion.
It enjoys the biggest market share in Europe – 19 per cent of the £11billion sector – ahead of US rivals Avis-Budget, Hertz and Enterprise, and Germany’s Sixt.
Europcar, the second biggest operator in the UK after Enterprise, has engaged in a buying spree of medium-sized independent car hire firms of late, but now its good name is in jeopardy.
Mr Stanford says he has learned his lesson after his experience with Avis at Faro airport. He no longer hires a car when he and his wife visit their house in the Algarve.
‘I thought, “I can’t afford to pay this kind of money three or four times a year”, so I bought a secondhand Ford Fiesta, which I keep out there,’ he says.
‘We get a ride from the airport for £55 and then use our own car to get around. It cost only £620, which over time works out a lot cheaper than all these ridiculous hire charges.
‘It gives me peace of mind instead of the worry of hiring and being ripped off. You go for a holiday to relax and you end up feeling you can’t trust anyone.’