Audi Is Acquiring Silvercar, My Favorite Car Rental Company

I’ve written extensively about Silvercar, which is my favorite car rental company. While I’ve historically dreaded renting cars due to how dated the technology and the industry is, Silvercar is changing that up. They’ve done to the car rental industry what Uber has done to the taxi industry (well, minus all the scandals).

They have one type of car (an Audi A4), and they take a lot of the other hassle out of the car rental process as well – they’ll fill up the car at “fair” fuel prices when your return it, they have fair tolling, satellite radio, etc.

Silvercar-LAX-4

Audi has already owned a minority stake in Silvercar. Early last year Audi invested $28 million for a 20% stake in Silvercar. Well, Audi is now buying the remaining shares in Silvercar for an undisclosed amount, so Silvercar will be 100% owned by Audi.

The deal is expected to close in the first half of this year. Here’s what Audi’s press release has to say about the deal:

Audi plans to acquire Silvercar by expanding its minority share to 100 percent. The U.S.-based company has successfully specialized in digital services for flexible vehicle use in the high-end market segment. In the future, Audi and Silvercar intend to cooperate closely to expand the range of mobility products and services offered in the U.S. In addition to the core business of Silvercar, both partners also plan to further develop the successfully launched Audi mobility services in the U.S. market. The acquisition is currently subject to approval from the applicable regulatory authorities.

Comments

  1. Agree with J. I’m sure part of the reason for the acquisition is Audi’s desire to better control their brand and avoid it becoming too mass market, so I wouldn’t be surprised if they raised prices to maintain a higher level of prestige.

  2. @J you hit it right on the head. No longer will the startup eat additional costs, Audi will pass those on to renters. @Ben is naive to think there won’t be changes like this.

  3. wait, it could get more expensive? They’re already awfully expensive, aren’t they. The good news is that there’s got to be a top end to what even rich people with too much money will be willing to spend on a rental car. So supply and demand should keep prices in check somewhat. It’s not like people don’t have options when it comes to renting cars. Maybe they’ll expand the number of places they serve.

  4. I also think Audi will make money on the back end by selling the used rentals through their CPO programs. Hopefully, the carfax will indicate that it is a rental. Or just avoid silver Audis if you buy CPO Audis.

  5. I agree that prices may rise, but it’s nice to have a “splurge” rental car option where you don’t wonder if you’ll end up in a Buick or a Taurus.

  6. @RakSiam You have to compare the prices at the same level when renting. So yes, at Avis or Hertz to rent a economy/compact car, it’s pretty cheap. To rent at Silvercar vs Hertz or Avis for a Audi, Silvercar (in my experience) has been significantly cheaper. That will go up now.

  7. This is not a move for rentals but all the car manufacturers are looking at car sharing to increase revenue. Younger buyers especially do not want to own cars as older generations do.

  8. I can see them adding other audi models to the fleet. There will be pressure to increase revenue and this would be one way but it would destroy the simplicity of the current business model.

    Hopefully there will be good benefits to audi owners. Great cross marketing opportunity about buying an audi then renting one while on vacation.

  9. I only rented from them once and it was a bittersweet experience.
    Pros: Cheaper than similar size car on other rental car companies, free GPS, free toll pass device, no need to fill the tank and charged only for the gas used
    Cons: Got a 2015 Audi (in 2017) with 40k miles and noises all over the suspension, tires and trunk. Car was pretty beaten up. They are usually not at the airport but around it so you need to get a shuttle that takes way longer that a normal rental car. No loyalty program so you get no benefits for renting from them a lot.

  10. I imagine that Audi will also want to expand the offering to their other models (which isn’t necessarily a bad thing) but I’d predict that price increases will follow.

  11. Silver car has always been about 2-3 times the cost compared to other rentals.

    I’m not sure Lucky why you seem to prefer expensive limited footprint options (Hyatt and now this). Or expensive and more inconvenient options (circuitous routing instead of direct flights). Or expensive and plain stupid options (paying $$$ for bring hand held in transit, tours etc as a young person).

    There’s absolutely nothing wrong with Hertz, Avis , Budget etc. With better pricing.

  12. I would like to use them not only as business, but also leisure.
    I have 2 young kids and a Q5 or Q7 would allow me to rent from them while on vacation.
    I hope that they add more airports as well.

  13. Most audi dealers have a rent a car inside of them to handle the loaner cars for their clients when their cars are being repaired/serviced. So my guess is that those companies (usually Sixt) will have to go and they will have silvercar as their new partner.

  14. I have used them once. With discounts and a special offer, I was able to rent for a week from LAX for just a little more than an Avis midsized. What made the difference for a weekly rental was Avis stacking all the fees on top of their rental costs. I enjoyed my weekly rental, but have not been able to find that sweet spot where it made sense again. For example, my weekly rental out of Phoenix was double the Avis mid sized rental cost. I would love to rent from them again, but not at twice the price.

  15. I hope Audi doesn’t raise prices to match AudionDemand prices. The onDemand program in San Francisco is cool since you can rent pretty much the entire fleet (A4, A6, R8, Q5, etc.) but the rates are significantly higher than GetAround, Turo, Zipcar, etc.

    I’ve rented Silvercar a couple of times at SFO, LAX, AUS, FLL, etc. and while a bit pricier, we’ve found it’s offer solid value relative to standard companies. Off-airport locations is a pain though.

  16. Silver car has always been about 2-3 times the cost compared to other rentals.

    Huh? A luxury car at Avis SFO is $56 a Silvercar is $69. Where are you getting your 2-3 times number?

  17. For those saying Silvercar is more expensive than Hertz, National, Avis that is definitely not always true. Silvercar has been pretty consistent in charging $59 per day for an Audi A4. Other rental car companies change that according to supply and demand. For example, I just looked for a week rent of a midsize car at EWR for next week. National quote me $134 per day for a midsize (Hyundai Elantra) while Silvercar has a A4 for $59 per day. That is a huge difference.

  18. I have rented from Silvercar and it was a great experience. I didn’t find it too much more expensive than other options. I also avoided the dreaded rental car shuttle: rep came and picked me up from the arrival curb. Also, no lines to get the car paperwork, no walk to rental garage, no waiting in another line to leave the rental garage. The car was ready to go, I just snapped a pic of the tag with my phone and left, no paperwork. I would gladly pay the price difference just to save that much time. My silvercar had 17 miles on the odo (also an s-line, which was a great bonus). It was perfect for me, my wife and our 2 year old. Unfortunately, the last time I traveled to a location with silvercar, I now have 2 kids and my wife insists on an suv. My hope is with this acquisition, suv might be available from them. I’m not wealthy, but I do love cars and splurge on them and hate walking out to the rental lot where the only car available is a bottom of the line Dodge Journey.

  19. I will be curious to see if they expand what models they offer. I own an A6 Prestige and honestly have no desire to rent an A4. As a 6’6″ man they are too small and it feels weird driving around a worse version of a car I own. But If they expand to A6/S6/A7/S7/A8/S8 I would seriously consider renting from them.

  20. I rent exclusively from Silvercar at LAX, and in my experience, the cost is no more than $20 more than (and not often less than) the cost for a full-size car for a one day weekday rental at Hertz and National, my other principal companies.

    I share the concern that the prices will go up. I’ve had similar experiences recently @ LAX with beat-up cars, so I think Silvercar was not turning their fleet over as often as they should, to try to minimize costs.

    Obviously, Audi can provide itself uniquely low cost vehicles, but still, based upon the On Demand pricing in SF, I suspect we’ll see price increases elsewhere.

  21. Car seats are free with Silvercar so when families are pricing them out with the competition it may even end up being cheaper.

  22. I see this as indication Audi wants to compete with BMW and Mercedes in the free-floating car share market. In Seattle you can rent BMW 3 series/X1/i3 and Minis from BMW-owned Reach Now, and Mercedes CLA/GLA and Smart ForTwos from Daimler-owned Car2Go, all for 40-50 cents per minute. Reserve a car within a few blocks of you with the app, drive to your destination, leave the car parked on the street for someone else to use. This is a much more efficient model than either Audi on Demand or Silvercar.

  23. @Santastico: Where are you looking and getting $100+/day for an Elantra? If you’re not finding reasonable prices from the rental car agency websites, start looking at OTAs (Expedia & such), Costco, and AutoSlash. I’m used to seeing $15-30/day for something Elantra-sized. My last Alamo rental was for a Ford Fusion, loaded, and IIRC it was only $150/WEEK.

  24. @AlexS: Just played for a reservation next week at EWR. For corporate reservations we cannot use Expedia, Costco, etc.. but have to go with a rental car company. As I said the normal car rental companies play with supply and demand and I don’t think Silvercar plays that game.

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