JEDDAH: The recent 15 percent hike in car prices might in turn lead to an increase in car rental fees in Saudi Arabia, market sources said Thursday.
"Many car rental offices in the Kingdom have called for reviewing current fees in light of the recent increase in the prices of cars," said Saeed Al-Basami, chairman of the car rental committee at the Jeddah Chamber of Commerce and Industry (JCCI).
He said the increase in demand of rented cars, especially during the Eid holidays and school vacations, means extra costs for car rental offices as they have to maintain their cars more. "This means they have to raise fees," he explained.
Al-Basami said some offices were offering luxurious cars to their customers including Mercedes, BMW, Hummer and others. "This means these offices spend a lot of money on their businesses and the only way to offset this is by increasing rent fees," he said.
In a meeting with members of the committee on Wednesday, Al-Basami asked the Jeddah municipality to review current car impounding areas in various parts of the city and also their charges.
He said the meeting discussed the importance of revising the current fees in the light of the rise in car prices and also to meet the rising costs of insurance and spare parts.
"Car rental fees in Saudi Arabia are the lowest compared to other GCC countries," he said. He added that all these matters would be discussed with the Ministry of Transport.
Al-Basami said Deputy Labor Minister Dr. Mufarreh Al-Haqbani assured the committee in a meeting with its members on Wednesday that the Nitaqat program for enforcing Saudization policies would take car rental businesses' interests into account and would be gradually implemented.
He said the deputy minister also assured them requests from such companies for visas for drivers, mechanics and cleaners would be considered favorably.
Al-Basami said the committee has assigned a consultancy company to study the needs and requirements of the transport sector for foreign manpower. "The results of this study will be submitted to the Labor Ministry for consideration," he said.
© Arab News 2012
