**The Indicator** is a podcast from NPR that explores the economics of everyday life. **Wailin Wong** is a senior reporter for NPR’s economics team. **Julia Ritchey** is a senior reporter for NPR’s economics team. **Wailin Wong:** We’ve seen a surge in demand for travel, and that’s been driving up prices across the board. But the car rental market has been particularly affected by this surge.

JANET ZARISH: (On The Rental Car Agent) We have reservations because we’re going to be late.

This was a good time for the industry. But then, as the pandemic wore on, the demand for cars started to fall. RITCHEY: This is a big problem for the industry because car rental companies have to constantly replace their fleets. They need to keep their cars in good condition to attract customers. BROWN: And that’s where depreciation comes in. Depreciation is the gradual decrease in the value of an asset over time. It’s a natural process, but it’s a big problem for car rental companies because they’re constantly buying new cars, and they’re constantly replacing their fleets.

* **Retail inventory:** Supply chain issues have largely resolved, but companies are still facing higher interest rates. * **Fleet makeup:** Automakers are shifting away from rental companies as a dumping ground for entry-level cars and are now pushing higher-end models and SUVs. **Detailed Text:**

The automotive industry is navigating a complex landscape of challenges, with both supply chain issues and evolving fleet composition impacting the sector’s dynamics.