How to Decrease High-Risk Rentals

Phil Spink, franchise manager of Sixt Rent a Car and Tom Wood Automotive Group, described to an ICRS audience two types of rental car thieves to look out for and how to minimize risk to rental...

Phil Spink, franchise manager of Sixt Rent a Car and Tom Wood Automotive Group, described to an ICRS audience two types of rental car thieves to look out for and how to minimize risk to rental fleets.

Photo: Ross Stewart / Stewart Digital Media

How can rental companies spot a high-risk rental transaction during the rental process? Being more aware of erratic behaviors during booking and at the counter could help prevent fraudulent rentals.

At the 2024 International Car Rental Show, a panel discussed various topics related to decreasing high-risk rentals. In addition to helping recognize inconsistent behaviors during the booking process, they also shared how telematics can identify driving behaviors (that could generate red flags for misuse) and how to work with a recovery company for repossessions.

“There are generally two types of thieves to look out for,” said Phil Spink, franchise manager of Sixt Rent a Car and Tom Wood Automotive Group. “You’ve got the customers that just keep the vehicle longer than they should and they will most likely surrender it. And then you’ve got the professional thief group, which is a fully committed theft with no intention of surrendering the vehicle.”

Recently, some of the highly desired rental vehicles for professional thieves include Chevrolet Tahoes and Silverados, Spink said.

The goal is to prevent these types of rentals before they occur, but once a rental company realizes its vehicle appears to be stolen, operators should act quickly.

Behaviors to Spot at the Counter

What does a bad reservation look like? The last-minute reservation is your highest risk reservation, said Mark Novak, chief revenue officer at telematics provider Zubie.

“The one-day reservation is your highest risk reservation, especially if made within the first hour or the last hour of them coming to the country or from out of state,” Novak said. “Those are the ones you need to watch, whether it be a professional theft or a customer looking to get the cheapest possible transportation.”

Novak also noted that these last-minute renters generally will only have the deposit amount. They won’t make a weekly rental or a two-week rental; they wouldn’t have planned the rental weeks in advance.

“What’s the reason this customer wants to rent a vehicle last minute?” Novak asked. “Usually, renters will plan to rent a BMW or a Tahoe some weeks in advance.”

Another red flag is a one-day reservation at an airport operation that’s booked for exactly 24 hours, such as noon to noon. “That’s generally not a real reservation,” he said. “An authentic reservation would be more like Noon to 3 pm. Pay attention to items like that.”

Another potential red flag is a last-minute renter needing a specific vehicle model. For example, if a last-minute renter only wants a Ford Expedition Max model, it could be they were sent there as part of a professional thief group to pick up a particular model, Novak said.

Mark Novak, chief revenue officer at telematics provider Zubie, noted that a one-day car rental is the highest risk reservation. - Photo: Ross Stewart / Stewart Digital Media

Mark Novak, chief revenue officer at telematics provider Zubie, noted that a one-day car rental is the highest risk reservation.

Photo: Ross Stewart / Stewart Digital Media

Training Rental Staff

Car rental operators should educate counter staff about potential red flags and how to handle them. If the last-minute reservation is a first-time customer, rental agents can tell that customer they need to verify their phone number.

“If they don’t answer the phone when the agent tries to call them, it’s probably not their phone number,” Spink said. “If it’s a Google number that says please wait as we try to locate this person, you’re going to slow down and pay attention to this rental transaction.”

Another method to verify the name on a phone number is through an online tool called Fast People Search. “If the name from the phone number matches the name on the online transaction, the agent will be more confident in saying that this is a real customer,” Spink said.

If the agent can’t verify that the phone number matches the name on the online reservation before the renter arrives, Spink recommends that the agent slow down during the check-in process and carefully check all the information, including details on the driver’s license.

“Rental agents are allowed to look at all the qualifications that the renter may need,” Spink said. “Agents can treat last-minute renters fairly and equally but don’t need to waive any qualifications to help them qualify for the rental.”

Make sure rental agents know their company’s policies and hold firm to them at the counter. Agents should tell the renters why they don’t qualify, whether it be a debit card or a qualification that doesn’t fit the company’s policies.

“We’re not trying to upset the customers, but the agents need to tell them the truth and turn them down respectfully,” he said.

Setting Parameters for Last-Minute Rentals

A rental operator retains some control over reservations and rate management. In a company’s policies, an operator can add parameters for rental rates.

“If you aren’t against losing a few customers, you could do things like certain vehicles need more than a 24-hour advance notice,” Spink said. “You’re going to stop the person sitting in the parking lot of your location making that last-minute reservation on their smartphone.

“Your company won’t show up on Expedia or other travel websites for immediate demand, but one-day rentals can be the highest risk and the most work to get the cars cleaned,” he said.

Using Tools to Help Locate Vehicles, Erratic Driving Behaviors

Once a vehicle goes out for rent, there are only so many ways to capture critical information that can help in recovering a vehicle, Novak said.

In the last five years, Novak said capturing telematics data has become important for all rental companies, but they need to be aware of the state laws on using tracking devices. In most states, companies just need to mention they use GPS tracking in their rental agreements.

 A common method used by rental companies to capture data from a vehicle is the on-board diagnostics (OBD) port.

“Some rental companies recommend plugging the device directly into the OBD port, but some don’t plug it in there because it calls attention to it,” Novak said. “Some companies hide it somewhere else within the vehicle, but it’s still connected to the vehicle itself to extract information. The OBD product is robust and configurable.”

Another common method of capturing vehicle data is through OEM-reported data.

“Some OEMs will report at five-minute pings, some will report at two-minute pings, and others will report when the ignition starts,” Novak said. “Most rental operators will typically ping once or twice a day for reassurance the vehicle is still in the state or in that parking lot.”

With the telematics data, companies can identify suspicious driving behaviors. A red flag is a vehicle running on a nonstop trip, meaning its engine has been running for over 24 hours, Novak said. Another red flag is a driver refilling the fuel tank multiple times.

“When a vehicle looks to be stolen, you start looking at the driving habits,” he said. “Are they going around the same block a few times? Is it going around city blocks and banks and looking at particular things? These driving patterns could indicate your vehicle is being used for something that it shouldn’t be.”

Work with a Vehicle Recovery Company

If a rental operator has received vehicle alerts about something suspicious, or can’t locate the vehicle when the renter failed to return it, how should they react?

“Once it appears the vehicle is stolen, get a recovery company involved as soon as possible,” Spink advised. “The quicker you get them involved, the better chances you have of recovering the vehicle.”

Spink recommended not doing your own vehicle recoveries; it’s too dangerous to involve employees. “Get an outside vehicle recovery company, whether it’s a national company like Collateral Consultants or a local towing company.”

If you locate the vehicle through your tracking system, don’t go alone. It’s important to get some help, he added.

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