Sandy leads to Thanksgiving rental car shortage

The storm has damaged thousands of cars — including those owned by rental companies. The loss of vehicles has been compounded by rising demand. Thanksgiving and Christmas are normally busy rental periods. And lingering mass transit problems caused by Sandy have added to demand.

Existing reservations are mostly being honored, but people who still want to book for Thanksgiving are finding almost no cars left. The few cars available carry a hefty premium.

Tadd Rosenfeld is flying into New York's LaGuardia airport Wednesday. He couldn't find a car with any major rental company. U-Save was the only one with a car and it wanted nearly $350 a day — more than his plane ticket from Florida. Now, he is considering renting a moving truck.

"Showing up to Thanksgiving in a U-Haul is worse than showing up with an escort. But at $19 a day, it's tempting," says Rosenfeld, CEO of TeamLauncher.com, an outsourcing company based in Miami.

To help ease the shortage, car rental companies have driven in thousands of extra vehicles from elsewhere in the country. They have also kept older models that they would normally sell to used-car dealers.

They'll need every car. Thousands of people in the Northeast are still without vehicles. Some cars were flooded by surging waters and will be replaced with new ones once insurance checks are cut. Others were damaged by falling trees and debris and are in body shops waiting to be repaired

Insurance companies State Farm, Progressive, New Jersey Manufacturers, Nationwide and USAA told The Associated Press in the days following the storm that they received about 38,000 car-damage claims. Other companies either did not return calls or declined to release claims information.