Renting a Car? Beware of PlatePass

Being a hedge fund analyst has taught me a lot about getting value for your money. You buy stocks that are trading below their intrinsic value and you make money once other investors see the true value of the business. I’ve taken this lesson and applied it to my spending; I don’t mind spending more for something, as long as I’m getting the right value for it.  PlatePass is the complete opposite of getting value. The service they provide is minimal, yet they completely gouge you on the pricing.

How Does PlatePass Work?

I recently rented a car through Hertz. When you rent a car, PlatePass offers an optional service where you can automatically pay for tolls without stopping at a toll booth. PlatePass offered this service for a fee of $4.95 per day, plus the cost of the tolls.

What makes PlatePass such a price gouge is the $4.95 per day charge is based on the length of the rental, not the number of days you use it. So if you use the service once for a 3-day rental, you’ll be charged $14.85, plus the cost of the tolls. For a 5-day rental, you’ll be charged $24.75, the maximum service charge, plus the cost of the tolls!

If you’re paying attention, you’ll realize this makes no sense whatsoever.  Why does PlatePass charge for days when it’s not being used? The answer is really simple: $4.95 per day doesn’t sound like much. If they said the service fee was going to be $25 (what most people will end up paying), everybody would have a fit!

PlatePass in the past
Here’s the sea-going version of PlatePass.

If You Don’t Like the Service, Don’t Use It

Unfortunately, that’s much easier said than done now. A long time ago, you had the option of stopping at a toll booth to pay the toll. Now, many tolls are only electronic, so there is no option to pay with cash. Also, most of us use navigation systems that by default route using the fastest route, which INCLUDES tolls. There is the option to avoid tolls, but you have to remember to change the settings in your navigation system every time you drive.

I’m not saying PlatePass is a bad service and that it doesn’t offer value. I’m just saying the prices they’re charging are ridiculous, and they’re doing it because customers aren’t in a position to really choose. Nobody searches for rental cars based on the service fees they charge for toll roads. You only realize you’re going to get gouged AFTER you’ve driven over a toll road.

Why Does PlatePass Even Exist?

With electronic tolls, customers can use a tag, but it’s not required. Customers with tags usually receive favorable pricing and get billed directly from the toll company. For customers that don’t have tags, the toll company needs to search a state’s license plate database to locate the car owner’s address, and then send them a bill.

If you look at PlatePass, they don’t add much value in this transaction. In my situation, Hertz would have been listed as the owner of the vehicle in question and they would have been sent the bill. In turn, they could have billed my credit card, and I would have happily paid the toll in its entirety ($1.16 in my case). Instead, Hertz uses PlatePass as a middle man, which then charged me $24.75 for the “service” of paying electronically.

The reason it’s structured this way is so Hertz can deny culpability. You see, I can’t blame Hertz, because it’s not their service. When I tried to contact Hertz, they immediately told me they had nothing to do with it and gave me the number for PlatePass.

However, the only reason Hertz would subject their customers to these hefty fees is because they’re getting a large cut of those “service charges”. I wouldn’t be surprised if Hertz got over 50% of these fees since PlatePass wouldn’t exist without the rental car companies. The only reason PlatePass is a standalone company is to take the blame for gouging customers.

How Can I Avoid Using PlatePass?

Obviously, you can avoid using PlatePass by not taking toll roads. But if you want to take a more proactive approach, you can rent from a company that doesn’t use PlatePass. According to the PlatePass site, it works with the following rental car companies:

  • Advantage
  • Avis
  • Budget
  • Dollar
  • DrivO
  • Firefly
  • Fox
  • Hertz
  • Sky
  • Thrifty

I’m not an expert on the rental car industry, but that’s almost all of them. So if you want to rent from a rental car company that doesn’t use PlatePass, your choices are somewhat limited.

I did, however, notice two larger rental car companies that don’t use PlatePass. The first is Alamo. At least in Southern California, Alamo charges $3.95 per day, but only on the days you use the service, and up to a maximum of $19.75. The second is Payless. Payless charges per length of rental just like Hertz, but it’s only $2.95 per day, up to $14.75 per month.

I’m sure if you look hard enough, you’ll find other rental car companies with more reasonable toll charges. The reason both these companies have lower rates is because they would face the backlash from poor customer service, not some scapegoat like PlatePass.

I’ve Been Gouged! What Do I Do Now?

If you’ve been gouged, you won’t find out until many weeks after your rental. I’m assuming they do this because it’ll be so long ago, you won’t remember if/when you took any toll roads and will just pay up to avoid dealing with this mess.

That’s exactly what the company wants you to do. Instead, you need to call the company to complain. When I called, I was very nice to the gentleman on the phone. He didn’t set these exorbitant rates and he’s only doing his job, so you can’t really blame him for this mess. Once I pointed out how steep the charges were ($25 service fee for a $1 toll), he offered to reduce the service charge to $4.95 since I only used it once.

The reason they did this is because everything is pure profit, so it’s not like they lose money by lowering the service charge. Also, it’s a way to reduce customer complaints but still get paid. I still feel like I was gouged, but I’d rather pay $5 than $25. It’s the people that pay the full amount that are truly getting ripped off!

Why Does PlatePass have an A+ rating with BBB?

That’s a great question for BBB. When this was published, PlatePass had 101 customer reviews and 98 of them were negative. I guess PlatePass should get points for responding promptly to customer complaints, although it was always the same standard response.

Thank you for sharing your experience. We take your concerns seriously. We will try to reach you via the email address provided.

Clearly, somebody is paying their BBB dues (with the money they’re gouging from customers)!

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