Tag Archives: Rental

The History of Budget Car Rental

Most of us do not think a second time before we rent a budget car for traveling from one location to another. We accept these services as a part and parcel of our day to day life and never bother to thing about their history. When we travel for leisure or when we need a car for our business trip, we just pick up the phone and ring up a budget car rental agency. These cars prove extremely helpful when we visit another city along with our family. Who started these services and who was the first to realize the great potential of this flourishing industry?

While it is very tough to find out the exact origin of the budget car rental services, their origins being enshrouded in the mists of history, it is widely believed that the first such rental company was founded by Joe Saunders. This gentleman started this industry with his model T Ford car. This particular car had made auto mobile transportation affordable to the masses. According to lore, Saunders would rent out his cars to customers and would charge them 10 cents per travelled mile. A special mileage tracking device was employed to calculate the number of miles the car had traversed.

It is rumored that the first person to rent Saunders’ car was a travelling salesman who used it to impress a local girl that he was taking out to dinner. Whether there is any truth in the story or not, the fact points out how useful these budget car rentals prove to travelling salesmen. Within a short period of time, Saunders found great success with his venture and started increasing the same. By 1952, this gentleman had rental car depots in over 20 states across USA. However, this success was short lived, and the economical collapse caused by the great depression found Saunders struggling to find sufficient business and eventually, he went bankrupt.

The initial success of Saunders made others take notice and it was not long before another person, Walter Jacobs, started a budget car rental service using the same model T ford car. Though Jacobs too experiences success in this venture, he sold out his operations to John Hertz’s owned Yellow Cab Company. Later on Hertz’s company was purchased by General Motors and their investment capabilities ensured that Hertz’s company survived. The era after the Second World War saw many organisations coming out with budget car rental services.

The close relationship between the rental companies and growth in air travel ensured the success of this industry. Businessmen travelling by air used to hire and use these budget rental cars in the cities they travelled to. Anticipating the growth in air travel, another entrepreneur, Warren Avis also started a budget car rental service and his operations were based within the airports. Nowadays one can find budget car rental services in nearly every major airport. What started as a humble and 10 cents per mile rental service has grown into a giant today.

Ramon Sylvester has been writing articles about travel for many years. You can find more of his work at his Australian website Budget Car Hire and Car Rental Deals