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Should you be mad at Hertz?

It is not difficult to find a business traveler who is hopping mad at Hertz these days.

Krishna Kumar, a program manager from Santa Clara, Calif., for instance, says he was taken aback by the car rental company's decision to tighten its terms and conditions. "When I saw them," he said, "I was very upset."

Among the most noteworthy changes are these: Hertz is holding its customers responsible for "any and all" loss or damage to a rental car resulting from natural disasters, from hailstones to hurricanes. If you return a rental car after hours, Hertz may continue charging you for the car until the rental office reopens (it used to consider the vehicle returned when you brought it back). And it abbreviated the grace period for returns to 30 minutes, from one hour.

But is Kumar's anger, and that of other Hertz customers who have complained about the switch in recent weeks, misdirected?

Considering that many other car rental companies impose similar terms on their drivers, it may be. And considering that these changes are likely to affect a relatively small number of business travelers, it probably is.

Take the most unpopular of the amendments, which essentially says that once the car is off the lot, it is the renter's responsibility. If you travel on behalf of a big company, there is no need to worry about that one.

"Traditionally, the loss-damage waiver is included in many corporate agreements," said Rose Stratford, the vice president of industry relations for WorldTravel BTI, which manages corporate travel for companies like Cingular, Energizer and General Dynamics. "Most of the contracts of a significant size are successful in negotiating some value adds. There are always negotiations that take place."

The renters most affected are the business travelers who are, in industry parlance, "unmanaged" - the sole proprietors, independent contractors and small-business owners who lack the wherewithal to hire a corporate travel manager with enough clout to make Hertz, or any other rental company, back down.

Hertz maintains that the revisions to its terms are routine, and the company seems hurt by the negative reaction to its announcement.

But experts say that all the talk about the wording in corporate agreements misses the main point, which is that the cost of renting a car is rising in ways that many may not realize.

How so? The cost of maintaining a new car fleet is rising. But because customers are balking at paying higher prices for their rentals, the companies are gradually breaking out expenses from the rental base price.

The companies may one year tack on a few dollars as a surcharge for disposing of old tires. Then, the next year, they begin charging an airport "concession fee" that covers the cost of renting office space in the terminal. They are also, as one car rental consultant, Neil Abrams, puts it, becoming "more aggressive in holding customers responsible for damage to their cars."

The car rental industry is not keen to discuss this subject. But the process, known as "unbundling," was confirmed by one of the foremost experts in the car rental industry, David Kilduff, the head of car rental procurement for American Express Business Travel.

"Corporate America is starting to realize that the cost of their car is going up because more things are being unbundled," he said. Each contract change, whether it shortens a grace period on returns or increases customer liability, "means more revenue to the car rental company." He said the process is by no means over, either.

Analysts say they think there will be a happy ending for Hertz and its competitors. Customers may complain, but they will not take their business elsewhere. With most of the major car rental companies imposing similar terms, where would those business travelers go?

That is exactly what happened to Kumar after he considered his options. He decided to stick with Hertz. "It has the best selection of cars, and in my experience, the best customer service," he said. "Plus, I'm a safe driver."

- NEW YORK TIMES

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