Car Rental Companies Ask Congress To Use Tarp Money to Get Commercial Credit Flowing
Congressional watchdog Barney Frank added an amendment to the TARP Reform Bill to allow TARP money to be used to restore the commercial credit lines needed by our nation’s largest rental car companies to buy cars for their rental fleets. (They also, I believe, added a provision requiring the Secretary of the Treasury to keep a Microsoft Excel sheet tracking who is getting TARP money. Yellow sticky notes had been required by the original TARP legislation.)

Photo by Representative Keith Ellison on Flickr. Image Licensed under Creative Commons Attribution Only License.)
The showrooms of many car dealers are tomb-like, and the rental car companies wanting to place large orders for such exotic cars as the Toyota Camry, the Ford Taurus, and the Chevy Malibu can’t find anyone willing to lend money to them.
According to a fine article by Kelsey Volkmann of The St. Louis Business Journal, Enterprise Rent-A-Car told employees in an internal memo: “The freezing of these lines of credit has in many cases crippled viable businesses that are simply unable to borrow the funds needed to run their day-to-day operations.”
In the same memo, Enterprise management indicated that they were not in the group struggling to get the credit to buy cars, which is great news. I received fine service from them last time I rented a Toyota Camry.
An amazing, although not exotic driving experience. I wanted to rent an Audi R8 but the insurance company of the guy who rear ended the OldsmoBuick me gave me a $27 per day rental reimbursement limit.
Anyway, Congressman Barney Frank is trying to make it right for the rental car companies by using TARP money to loosen up commercial credit markets so that rental car companies can get the credit they need to place orders for cars.
Maybe Congress will give the rental car companies relief with certain conditions. Perhaps the companies will be ordered to put all of their SUVs into luxury car storage and buy a mix of Smart Cars, Pastel Priuses, and Honda mopeds.
I just hope the rental car company CEOs have the good sense to hitch hike or carpool when they go to ask Congress for the help.
Eric on January 30th 2009 in Exotic Car Rental











