I heard a fascinating piece on NPR last week about car rental agencies and their disaster relief plans. When it comes to relief efforts after a hurricane or other natural disaster, rental car companies are the face of the future. This comes down to their ability to manage their fleets appropriately, to get the proper vehicles to the proper locations at the proper time. I’ve written about fleet management here before, but from a transportation management system (TMS) perspective. Car rental agencies are not moving freight, but the assets themselves, which is different from how a shipper would manage its fleet.
As a refresher, fleet management is a TMS for freight moves involving transportation assets owned by the company. The complete process would include routing and optimization; visibility and exception management (including GPS style solutions); transportation as-set management; and performance management. Transportation assets include both power units and container cars. Few solutions, if any, support the end-to-end process described here. Routing is the historical heart of fleet management. For classification purposes, any solution that includes routing plus any of the other modules listed would be deemed a fleet management solution.
The car rental business is all about pleasing the customer. Companies need to have the car a customer wants (and has reserved), at the exact time they want it. While it sounds simple enough, many car rental agencies have over one million cars in their inventory across the country. There are a lot of moving parts in order to provide a positive customer experience. However, when disaster strikes, these companies have to be forward thinking proactive to meet the growing demand of rentals. There are a few key components that make managing inventory more important during a disaster.
The first part is to make sure that any vehicles that are in a soon-to-be affected area are safe for future use. This means moving vehicles out of harm’s way – either to other locations or to a safe storage facility. The most important thing is to have vehicles on hand for after the disaster strikes. There are a variety of people that will need vehicles. In the last few years, hurricanes have damaged more than one million automobiles in the United States. This means many car owners with an insurance claim will need a rental car. But, there are a large number of other people that will need a vehicle once the disaster strikes. This includes first responders, volunteers, officials, and reporters will all need a rental car to assist in or cover the recovery effort.
This brings in the second key part of managing inventory – a massive influx of vehicles will be needed after the storm passes. According to reports, when Hurricane Harvey was forecast to slam into Texas, and even before the first drops of rain or gust of wind made landfall, rental agencies had tens of thousands of vehicles en route to Texas for the aftermath. While pulling inventory from other locations can cause a few problems customer service-wise in other regions, such as the exact model of a car may not be available for a day or two, it is a necessity to deal with the demand of disaster relief. This means understanding exactly where every asset is physically located, how to get each of the vehicles to the affected area, and the timing has to be right. The vehicles need to get there as the storm winds down – too soon and they are in harm’s way, too late and they aren’t of much use. This involves a lot of planning and preparation.
While most people often look at the car rental market as fairly low-tech, this is simply not the case. Agencies use a combination of artificial intelligence, big data, and dynamic planning engines, not to mention the expertise of seasoned veterans, to meet the ever-changing demand of a fickle customer base. During a disaster, as emotions run high and every second can count in the recovery effort, getting the vehicles in the right place is even more important.
Due to the use of technology and incredible planning procedures, many consider rental agencies to be the wave of the future. This is especially true as vehicles become autonomous. Getting the vehicle that the customer wants, in the right location at the right time, will be increasingly important. And for a market that can thrive in the pressure of a natural disaster, the future indeed looks bright.