HERTZ TO OUR (YOUNG) MAN: GET A HORSE
(FORTUNE Magazine) – When I moved to New York City just after my 23rd birthday last year, renting a truck to transport my belongings was simply a matter of picking up the keys. No problem, said U-Haul, as long as I was at least 18 years old.
So when I planned my first escape from the Big Apple, I was astonished to learn that Avis and Hertz wouldn't even rent me a Geo Metro. You'd think that if I could maneuver a 17-foot truck from Boston to Brooklyn, I could handle a hatchback. But no. Hertz and Avis generally don't rent to the under-25 crowd.
The companies point to accident statistics that show my peers bash an inordinate number of cars (see chart), ergo Hertz and Avis have to pay more for maintenance and insurance. Okay, but why not just pass those extra costs along to us in the form of a fee? Because, says Hertz spokesman Joe Russo, "you can't quantify what your liability costs will be. It's like asking, 'How high is up?' "
Well, Alamo at least seems to be able to do the math. While the company avoids newly minted motorists in the gonzo 16- to 20-year-old bracket, they do rent to drivers ages 21 to 24 and simply add a $15-per-day surcharge to cover the costs. Though Alamo's business has hit the skids this year, it's not because of people like me; a mere 5% of their customers are between 21 and 24.
Hertz and Avis have persisted with their policies, even though two courts have ruled that their actions are illegal. In a Washington, D.C., small-claims court, Hertz's fancy lawyer was defeated by a 24-year-old law student named Pamela Sosne. The judge presiding over the 1993 case lambasted Hertz's argument that the company couldn't make money if it had to rent to young folks. "I hope 150 more people sue them too," says Sosne. Right on, Pam!
Whether or not this type of age discrimination is legal, it's still an odd foundation for corporate policy. I shouldn't have to sue Hertz and Avis for the privilege of giving them my money. But if that's how they want to play the game, fine. They can be damned sure, though, that when my peers and I age into older and even grouchier corporate honchos, we won't be sending any business their way.
--Ronald B. Lieber