A $50 million car rental from Iceland Vacation Rentals, the largest car rental company in the world, was canceled Thursday after an angry customer demanded to know how he was paying for a trip.
Iceland, which operates a fleet of cars in several countries, had said it would replace the rental, which costs about $5,000.
Iceland did not immediately return a call seeking comment.
A few hours later, the company tweeted a photo of a car rental notice posted in the hotel lobby, which said customers who did not sign up for a rental were charged $50 for the first night and $50 per night for each additional night.
In an email to customers, Iceland’s chief financial officer, Peter Pudney, wrote that the company was not responsible for any damage to property, or any injuries that may occur while driving, and that it would refund the customers $50 if they were not satisfied with the rental.
Pudney also said customers could choose to pay the rental directly or through Iceland if they preferred.
“If you don’t sign up, we will replace the vehicle with a different vehicle that you choose from our fleet of vehicles,” Pudneys email read.
After a few days of negotiations, Icestals CEO and co-founder Chris O’Connell was able to convince a small group of Iceland employees to agree to pay a $5 fee for a second reservation.
O’Connel, who said he was angry because of his $10 million car loan from Citibank, said he and his wife had agreed to pay $25 a day.
He said he made a deal with the hotel to only use their vehicle, which he said cost him $200,000 to build and $500,000 a year to operate.
The hotel has not yet returned a call for comment.
Icest’s car rental policy does not mention an insurance policy or vehicle.
When Iceland launched in 2009, it was a $30-a-day rental.
Over the next three years, it grew to about $100,000 annually.
It was Icests biggest customer and a top competitor to other rental companies, including Hertz and Avis.
As of March, Icervis revenue was about $6.8 billion, or about 11.4% of the company’s $21.3 billion in revenue.
O’Connell said the company is not targeting the luxury rental industry, which has a high turnover and is not yet fully competitive with other car rental companies.
But he said the rental company would not be able to maintain the high rental rates because of the new car rental regulations.
That meant customers were left with no choice but to pay full price, he said.
Many Iceland customers were surprised by the cancellation, he added.
While the company did not provide any details about the reason for the cancellation and the customer service staff did not respond to an email seeking comment, some Icest users posted comments on the company Facebook page.
One customer said he had paid for a car in the past but was disappointed to see the company no longer offer it.
Another said the cancellation was sad because he was “shocked” at the number of customers Iceland could serve.
My husband and I were a little sad, because we have used Iceland to rent cars and this was our last chance to get a car, he wrote.
Calls to Iceland were not returned by Thursday evening.