Make us your home page
Instagram

Tread carefully when renting your wheels

When the tires on their Dodge Caravan had worn so thin that the steel belts were showing through, Don and Florence Cherry couldn't afford to buy a new set.

So they decided to rent instead.

The Rich Square, N.C., couple last September agreed to pay Rent-N-Roll $54.60 a month for 18 months in exchange for four basic Hankook tires. Over the life of the deal, that works out to $982.80, almost triple what the radials would have cost at Walmart.

"I know you have to pay a lot more this way," said Florence Cherry, 57, a nurse who drives the 15-year-old van when her husband isn't using it to get to his job as a prison guard. "But we didn't really have a choice."

Socked by soaring tire prices and short on funds, growing numbers of Americans are renting the rubber to keep their cars rolling.

Rent-to-own tire shops are among the newest arrivals to a sprawling alternative financial sector focused on the nation's economic underclass. Like payday lenders, pawn shops and Buy Here Pay Here used-car lots, tire rental businesses provide ready credit to consumers who can't get a loan anywhere else. But that access doesn't come cheap.

Customers pay huge premiums for their tires, sometimes four times above retail. Those who miss payments may find their car on cinder blocks, stripped of their tires by dealers who aggressively repossess. Tire rental contracts are so ironclad that even a bankruptcy filing can't make them go away.

Still, with payments as low as $14 a week, rent-to-own — long the province of sofa sets and flat-screen TVs — is proving irresistible for consumers desperate for safe transportation.

It's also a booming business for specialized tire and wheel dealers that have become beneficiaries of a struggling U.S. economy. Fast-expanding chains with names like Rent-a-Wheel and EZ Rims 4 Rent that got their start selling high-end rims to car enthusiasts have discovered a lucrative market selling tires on time.

"We see tremendous opportunity serving people who are just looking for dependable tires to get to work," said Larry Sutton, founder and president of Rent-N-Roll. The Tampa chain has 66 locations nationwide and plans to open six more this year.

Sutton registered the trademark RNR Tire Express last fall and has been rebranding many stores to focus on tires instead of the oversized chrome rims that were the chain's mainstay. Today, Sutton said, tires make up two-thirds of RNR's sales, up from less than half several years ago.

A host of economic factors are pushing the growth of tire rentals.

Soaring costs for natural rubber and petroleum used to manufacture tires have pushed up prices. The average price of a passenger tire in the United States increased 57 percent in 2012 from 2006, according to data from trade publication Modern Tire Dealer. The prices on some popular sizes have more than doubled.

Consumers, meanwhile, have an increasingly difficult time affording big-ticket purchases.

Since 2009, median household income has fallen more than 5 percent. And in the wake of the recession, the number of households in the country with credit histories too damaged to qualify for most credit cards has risen.

Tires account for just a tiny slice of the $8.5 billion rent-to-own market. But they stand out because — unlike with a dinette set — giving back tires means not being able to drive to work.

"Tires are a necessity," said Jim Hawkins, a University of Houston law professor who studies the alternative finance industry. "These customers are vulnerable because they have no choice."

The first rent-to-own tire and wheel dealers appeared in the 1990s, targeting young urban males. Chains enlisted rappers to hawk shiny customized rims and low-profile tires. But after the economy crashed, dealers saw an influx of customers asking for standard passenger tires. Many were older and a surprising number were women, a group the industry had all but ignored.

Tread carefully when renting your wheels 06/27/13 [Last modified: Wednesday, June 26, 2013 6:49pm]
Photo reprints | Article reprints

Copyright: For copyright information, please check with the distributor of this item, Tribune News Service.
    

Join the discussion: Click to view comments, add yours

Loading...
  1. Expanded Belle Parc RV Resort lures travelers with plenty of amenities

    Business

    BROOKSVILLE — Imagine mid-mansion, upscale-enclave living. On wheels. The outcome is Belle Parc, an upwardly mobile, even luxury, RV retreat just north of Brooksville that opened Jan. 1 after two years undergoing expansion, uplift and amenity enrichment.

    A new welcome center is under construction, rear, at Belle Parc RV Resort, where lake sites are being completed, bringing the resort's capacity to 275 spacious park-and-stay slots.
 [Photo by Beth N. Gray]
  2. Memorial Day sales not enough to draw shoppers to Tampa Bay malls

    Retail

    TAMPA — Memorial Day sales at Tampa Bay area malls were not enough to compete with the beach and backyard barbecues this holiday weekend.

    Memorial Day sales weren't enough to draw shoppers to Tampa Bay area malls over the long weekend. 
[JUSTINE GRIFFIN | Times]
  3. Austin software company acquires second Tampa business

    Corporate

    Austin, Tex.-based Asure Software acquired Tampa's Compass HRM Inc. late last week for $6 million. Compass focuses on HR and payroll.

    [Company photo]
  4. Hackers hide cyberattacks in social media posts

    Business

    SAN FRANCISCO — It took only one attempt for Russian hackers to make their way into the computer of a Pentagon official. But the attack didn't come through an email or a file buried within a seemingly innocuous document.

    Jay Kaplan and Mark Kuhr, former NSA employees and co-founders of Synack, a cybersecurity company, in their office in Palo Alto, Calif., in 2013. While last year's hacking of senior Democratic Party officials raised awareness of the damage caused if just a handful of employees click on the wrong emails, few people realize that a message on Twitter or Facebook could give an attacker similar access to their system. 
[New York Times file photo]
  5. Big rents and changing tastes drive dives off St. Pete's 600 block

    Music & Concerts

    ST. PETERSBURG — Kendra Marolf was behind the lobby bar of the State Theatre, pouring vodka sodas for a weeknight crowd packed tight for Bishop Briggs, the latest alternative artist to sell out her club.

    Sam Picciano, 25, left, of Tampa and Molly Cord 24, Palm Harbor shop for record albums for a friend at Daddy Kool Records located on the 600 block of Central Avenue in St. Petersburg, Florida on Saturday, May 20, 2017. OCTAVIO JONES   |   Times