Car Hire Firms Put Brakes On Unfair Pricing

The chief executives of six major car hire companies have been hauled over the coals by the European Commission for their pricing policies.

The letter was sparked by complaints from motorists around Europe who claimed they could not pay the cheapest prices for car hire because online booking sites discriminated against them because of their country of residence.

Now, the European Commission vice-president Michel Barnier has named and shamed the firms and written to their CEO’s demanding an explanation of why they are unfairly treating customers.

The six firms – Sixt, Enterprise, Goldcar, Europcar, Hertz and Avis – priced car hire by detecting a consumer’s online IP address and rerouting them to a web site offering costs based on their place of residence.

In one case, a German consumer was charged double the price for hiring a car in Britain than he could hire the same vehicle for in Germany from the same company.

Online services

“In a single market, all consumers should be offered the same prices for the same product or service,” said Barnier.

“If they are booking online, where they live should not matter if the same goods or services are provided in the same location by the same provider as the costs to the company will be similar.”

Barnier explained that Sixt, Enterprise, Goldcar had changed their marketing to match the non-discrimination rules of the European Services Directive, but he had not received satisfactory responses from the other three companies.

“I have given them until the end of August to review their policies and will then consider taking further action against them,” said Barnier.

The European Commission decided to reveal the contents of the letter in the interests of consumers.

Price differences

A spokesman suggested that consumers and expats looking to hire cars might want to shop around for the best prices before booking due to the variations in prices and the limited availability of best prices.

“The prices offered by car hire firm web sites can vary significantly and these vast price differences cannot be justified,” said the spokesman.

The car hire firms have declined to comment on Barnier’s letter.

An IP address is an internet server code that tells a web site where the online visitor is located. Depending on the code, the web site can reroute the visitor to a different web site.

BBC iPlayer, for instance, uses IP addresses to detect the visitor’s place of residence and right to access programmes. Many programmes are unavailable to web users outside the UK because of licensing right issues with production companies.