The Los Angeles Times is reporting that America's tire rental business is growing. Companies that previously specialized in rent-to-own wheels are now shifting their business to provide low-income drivers with rent-to-own tires. Customers can pay as little as $14 per month for new rubber, but may wind up paying as much as four times the retail price by the time all's said and done. While the first rent-to-own wheel and tire dealer surfaced in the mid '90s, the business has been expanding.
Part of the issue is that tire prices have increased dramatically in recent years – according to the story, trade publication Modern Tire Dealer says that the average price of a passenger car tire increased some 57 percent between 2006 and 2012. The boom in business is also being attributed to statistics that say that average household income has fallen by more than five percent since 2009, and the number of individuals with severely damaged credit has jumped to 35 percent since then. Rent-to-own businesses often don't require a credit check, ask for relatively small down payments and allow customers to return merchandise at any time without penalty. All told, the rent-to-own market in the US is an $8.5 billion per year business, and while tires make up a tiny slice of that total figure, the business is growing.
Meanwhile, customers who miss payments can face aggressive lenders. Since the rent-to-own businesses technically own the property until the last payment is made, some states place failure to pay on the same level as theft, which can lead to police involvement. As The Los Angeles Times reports, RimTyme, which operates in North Carolina, Virginia and Georgia, makes as many as three repossessions per week.