Airport to consider changes to car rental contracts after pricing complaints

A customer rents a car from the Enterprise counter at Missoula International Airport in this 2016 file photo. Enterprise will purchase the Alam0-Enterprise business at the airport, raising concerns among the airport board over a potential lack of competition, in turn influencing prices. (Missoula Current)

Allegations of price gouging by car rental companies at Missoula International Airport could prompt the airport authority to make changes to its lease agreements before they’re renewed next year.

After months of rumors, the issue surfaced this week as the airport authority considered Corpat Inc. and its plan to sell its Alamo-National car rental counter to Enterprise, raising concerns that a single entity could monopolize the airport’s car rental business.

Enterprise already owns and operates a counter at the airport.

“You could have five separate car-rental agencies owned by one person,” said airport board member Winton Kemmis. “It’s a potential.”

Airport Director Chris Jensen said such concerns are possible under the airport’s current concession agreements with the car-rental agencies. But those agreements will likely change by next year as the current agreements expire.

“We’re proposing new language as we go back out to bid – some kind of specific prohibition for something like that,” Jensen said. “We’re certainly aware of it and we’re working to eliminate that.”

Enterprise Holdings was formed in 2009 after Enterprise Rent-A-Car acquired the parent company of Alamo and National car rental. The company operates through regional subsidiaries and leads the car-rental industry with roughly one-third of all airport business in the U.S. and Canada.

Enterprise Holdings didn’t respond to inquiries Wednesday regarding its Montana operations.

“We’ll be looking at what other airports are doing, because Enterprise is doing this throughout the nation – buying up the Alamo-National franchises,” Jensen said. “When we go out to bid in the fall, we’ll likely limit the number of owners we’ll allow to move into those spaces for car rentals.”

The current concession agreement with the car rental companies at the airport went out to bid in 2014 and expire next June. Members of the airport authority look to see those agreements change to prevent the complaints that surfaced this summer.

One of those complaints came from Kemmis’ friends who visited this summer from California. The contract they agreed to differed from the contract they were given by the car-rental counter in Missoula.

“It was absolutely a disaster,” Kemmis said. “They wanted way more money than what they had agreed to. They were able to settle, but not without a great deal of discomfort. That’s not the way it should be.”

Jensen said the airport received similar complaints over the summer and will look at capping what car-rental companies can charge in Missoula when compared to surrounding airports.

“We’ve done that with some of our other leases,” Jensen said. “We’ll likely have some kind of stipulation where it has to be within 10 percent of surrounding communities, or something of that nature, so it doesn’t allow for some of the price gouging that we think happened this summer.”

The airport receives roughly $3 for every day a vehicle is under contract. The “contract facility charge” generates roughly $500,000 a year. Companies that operate in Missoula include Alamo, Avis, Budget, Enterprise, Hertz, National and Thrifty.