Rent-a-car sector crashes - Operators rev up plea for state help
REELING FROM losses of between US$3.5 and $4 million per month, Jamaican car-rental operators are appealing to the Government for a host of concessions to pull themselves from the devastation caused by the COVID-19 pandemic.
The group, which is a critical facet of the hospitality sector, owns 75 per cent, or 4,500, of the 6,000 vehicles that have been parked indefinitely since the Government closed the island’s ports to inbound passenger traffic on March 24.
“Between the 25 member companies who form the Jamaica Rent A Car Association (JRACA), and the informal operators, basically our business is capital intensive, so apart from interest accruing on our loans, our vehicles attract depreciation on a yearly basis, whether operated or not,” president of the association, Patrick Small, told The Gleaner.
Small, who owns Sunjam, and two members of the board, Orville Spence of Sixt Rent A Car and Roan Wedderburn of Pat’s Car Rental, say their organisation has not been invited to sit at the table during the talks about the impact of COVID-19, despite appeals to Minister of Finance Dr Nigel Clarke and Minister of Tourism Edmund Bartlett.
The 50-year-old organisation is asking for a zero-rated concession on duty over the next two years. The membership also want a revisit of the conditionality provision that would see the removal of a lien on their ability to sell imported vehicles within two years, “so that we can sell and reinvest capital and pay off our creditors,” Spence said.
The downturn on the local market has followed lockstep with the global narrative that has seen the biggest players brought to their knees.
With its fleet of nearly 670,000 vehicles stalled, Hertz last week filed for bankruptcy protection, having slashed 20,000 employees, or half its workforce.
Avis, another global powerhouse, said in March that it would cut its new-car purchases by 80 per cent.
When The Gleaner contacted the tourism minister yesterday, he expressed a willingness to meet with the group, which employs an estimated 1,000 people.
Bartlett said that the car-rental operators might be eligible to benefit from the $1.2 billion tourism grant announced weeks ago as part of a coronavirus stimulus package.
Wedderburn, who represents Westmoreland, with his business based in Savanna-la-Mar, said that his nine employees have been furloughed, with an out-of-pocket stipend offered every two weeks.
Small says he anticipating an early opening of the industry, because being locked down is unsustainable for any length of time.
JRACA has been proactive establishing a number of protocols to be established post COVID-19.
• All returning employees are to be screened/observed for any flu-like symptoms for a two-week period from the date of reopening/returning to work. If any signs/symptoms are evident, they are to be immediately pulled from duty and asked to self-quarantine and visit the company doctor or their private doctor. Where an employee is so affected, this should be reported to the relevant Public Health Authority.
• Staff should wear protective gear (e.g., face masks, gloves) while conducting duties; if possible, drivers should wear gloves when delivering and/or collecting vehicles.
• Cleaning staff should wear disposable gloves for all tasks, including handling trash.
• Only Customers directly involved are permitted to enter their offices and they must wear masks and if possible gloves or their hands must be sanitized immediately upon entering.
• Customers are being encouraged to use their own pens to sign the forms. Where this is not possible and pens have to be passed from the employee to the customer, the pen should be sanitized after each use by the customer.