The surprising thing about today's ‘scoop’ by the Daily Telegraph is that it has taken so long to reveal what hundreds of thousands of customers have known for years, that car rental companies are ripping-off customers over supposed ‘repairs’ that either overcharged or charged for several times for the same scratch of dent.
Europcar in the UK now stands accused of fraudulently overcharging customers with Trading Standards officers raiding the French company’s UK head office last week.
The Daily Telegraph breathlessly reports that Europcar in the UK “may have profited to the tune of millions of pounds by inflating the cost to consumers of windscreens and other repairs by up to 300 per cent.”
The company can be fine up to 10% of its turnover. The company had revenues in 2016 of €2.15 billion, so this suddenly has become a serious matter but at the same time is one that has been avoided for years by trading authorities in other European markets, including Portugal’s ASAE despite thousands of complaints.
Consumer groups accused Europcar of "exploiting" customers, according to the Telegraph’s ‘exclusive.’ These unnamed ‘groups’ suspected the practice was widespread in the car hire industry where those accidental damage and scrapes falling outside Europcar’s insurance cover, are billed for inflated repairs presented as the true cost.
There now is evidence showing grossly inflated repair prices charged to renters with the car company pocketing the difference between what it charges the customer and what is actually pays the repair shop.
Europcar can produce a repair bill, if pushed, but once the customer’s bill is paid the supplier issues Europcar with another invoice for the lower amount and the car rental company pockets the difference.
In one example quoted in the Telegraph, a Europcar customer, Zdenek Kramsky, was told by the company that the cost for a windscreen replacement was £615 plus VAT.
But when he called the supplier, National Windscreens, for a quote for the same job he was told the cost would be £176 plus VAT.
Kramsky was told by a National Windscreens employee that Europcar agrees an inflated price with National Windscreens, and later receives a rebate for the difference.
Mr Kramsky told the Daily Telegraph, "Whichever way you look at it, what Europcar did to me was unethical, underhand, immoral, unreasonable and bad commercial practise.”
James Daley, a director of the campaign group Fairer Finance, said, "People have long suspected they are being ripped off for hire car repairs but it’s shocking to see the evidence. Car hire companies are in the business of loaning vehicles, not exploiting customers involved in a scrape.
"Europcar are unlikely to be the only ones doing this and the industry must change its ways."
The Telegraph did not include the ‘multiple billing for the same scratch’ scam, a ruse well used by many car rental companies which will charge for a repair and re-spray to, for example, a door, but then waits until subsequent customers scratch the same door, charging each for the whole job.
Europcar is in a highly embarrassing position having just bought Spanish car rental rip-off specialists Goldcar which operates across Europe including stands at Portugal’s main airports. Aiming to raise Goldcar’s image from the primordial swam where it languishes, Europcar now has image problems of its own - potentially expensive ones.
Long considered the worst possible type of car rental company in the industry, Goldcar is being sold for €500 million to Europcar but needs European competition clearance before the deal finally is signed.
Back in the UK, "Europcar takes the allegations very seriously and is conducting a thorough internal investigation. The company is co-operating fully with Trading Standards in its investigations. It can make no further comment at this point," nor has National Windscreens.
See also: 'Europcar buys Goldcar for €500 million' June 19th, 2017
