Got Wheels?

For those who might be lucky enough to be vacationing soon . . . Irma Russell’s recent article Got Wheels?: Article 2A, Standardize Rental Car Terms, Rational Inaction, and Unilateral Private Ordering might be a worthy read. The piece takes a good stab at the issue of adhesion contracts—a popular complaint here recently—in the context of car rentals. Her study compared the terms and conditions of rental agreements and pricing information available to consumers pre-lease, often available to Irma in the oft-seen flimsy paper of the 8-point variety. Not surprisingly, the terms (which heavily favor the rental companies) are offered on a take-it-or-leave-it basis and Irma was met with laughter from one company in response to her request to vary the standard rental terms.

Irma’s observation about lack of consumer preferences on these types of terms strikes at the heart of the debate. It seems like an unfortunate state of affairs that consumers have little bargaining room in these types of transactions. That said, unless severe overreaching occurs, I tend not to question the terms offered and go on my way. In fact, the faster that Hertz gets me in the car and on my way, the happier I tend to be. Consumer inaction strikes again.