This post is in response to a client regarding the fact that RCI rents out weeks and therefore those weeks aren’t made available to timeshare exchangers.  Many people believe that when RCI gets a deposit from an owner of a really nice timeshare they would rather rent it out for a profit rather than make it available to us.

I suspect that this may have happened when RCI changed hands in 1996 but no longer.  I asked this question to an RCI agent that’s been with the company for a few years and is ready to move on to other endeavors.  If he had wanted to slam RCI he had his chance.  But he assured me that this is just a misconception.

In fact, RCI does rent out weeks as Extra Vacations and Last Call vacations and special promotions but what’s important is to recognize where that inventory comes from.  I’ve included the RCI email to my client, his email to me and my response.

—– Original Message —–
From: “Fred & Beverly

To: “Jeff Pierce” <Jeff@TheTimeshareExpert.com>
Sent: Saturday, May 31, 2008 3:55 AM
Subject: Fw: Book one paid vacation rental – Get one free!]
Below is a copy of a message we just received, proof RCI rents weeks. Do they hold the better weeks from exchanges? Maybe and maybe not but the public perception is that they do and it is the public perception that drives their decisions.
 
Fred
—————————- Original Message —————————-
Subject: Book one paid vacation rental – Get one free!
From:    “RCI” <rci@email.rci.com>
Date:    Fri, May 30, 2008 11:13 am
To:       Fred and Beverly
————————————————————————–

As an RCI Subscribing Member, you’re  entitled to opportunities for great prices on exclusive travel options at popular destinations.

With RCI vacation rentals, you enjoy more spacious accommodations than at ordinary hotels, plus many of the amenities, services and activities you’ve come to expect on vacation.

Book between May 1 and May 31, 2008, and you could be  enjoying not just 1, but 2, great vacations.    With this special offer, when you book one paid vacation rental for any future travel date, you can choose a free vacation from select resorts available from 09/05/08 through 11/14/08.    

You must book both your paid vacation rental and your free vacation rental between 05/01/08 and 05/31/08. This exclusive offer is only available by phone. Destinations and travel times are subject to availability and confirmed on a first come, first served basis.

Offer includes only accommodations and specifically excludes travel costs and other expenses that may be incurred. Taxes, additional fees and charges may apply.

Mexican resorts may charge a mandatory all-inclusive fee. Promotional discounts and offers may not apply to all properties. Other restrictions may apply. Offer void where prohibited by law.

The free Extra VacationsSM getaways are not available during most U.S. holiday weeks, spring break weeks and peak-demand summer weeks. Reservations must be made at least 1 day prior to travel.

Prices are based on a seven-night stay and include all applicable taxes.

You won’t have to exchange your RCI Points or deposit a vacation week. These Extra VacationsSM getaways are limited and subject to availability.  Additional restrictions may apply.

My response.

Hi Fred and Beverly.

You should call RCI and ask them where they get the inventory for these vacations they rent.  It may reduce your frustration level with them.  I get the feeling that you think I work for RCI or want to defend them but I don’t on either case.

I believe they provide a good service to timeshare owners at too high a price.  $199 for an exchange is ridiculous and it just keeps going up.

If you notice in their email that the weeks they’re renting are off or shoulder season.  Where do these weeks come from? One source is from new timeshare development that sell week to RCI inexpensively
for RCI to rent.

This is a marketing tool that all developers use to fill the rooms, restaurants and bars at their resorts, especially in the slower season.  The people that are renting the rooms are then invited to attend a presentation.  The clients staying at a resort are more likely to buy than someone that drives in for a day.

The reason you find rental vacations in older, even sold-out resorts, is that a resort never really ever sells out.  When the sales force and marketing company is done selling the resort the inventory actually grows because of foreclosures.

With no sales force to sell these weeks, and the HOA wanting the fees on the weeks to keep from raising them to existing owners, the Board of Directors, many times still controlled by the developer, sells the weeks to RCI.

Another source of rental weeks for RCI is cancellations or unused weeks.  Every year RCI ends up with more weeks deposited that used. I believe a big part of that is because frustration with the exchange process and is the reason for my guidebook on exchanging.

RCI knows which weeks and in which resorts they’re most likely to have unused weeks, and being a for profit company naturally rents them.  I would too if I were in that business and it was ethical. 

I, like you, was convinced at one time that RCI was renting many of the best weeks deposited with them, but no longer.  There is still ongoing litigation of this matter and I believe that although RCI may have done this at one time, they do so no longer.  But the perception by the public still exists and as you said, it is hurting
their image.

RCI isn’t the company it once was.  Their problems started in 1996 when the owner and founder, Christel de Haan, sold RCI to FHS, which became CUC which became Cendant, for $500 million dollars.  There were too many changes too quickly and RCI’s service really suffered in the early years following the acquisition. 

And although RCI does hundreds of millions of dollars a year, maybe even a billion, it is still a small part of the giant Cendant Corporation.  RCI no longer has the guiding hand and personal caring of the original founder.  It’s big corporate business now and it shows.

So Fred and Beverly I hope this sheds a little light on the subject of RCI renting weeks.  Like I said, I’m not trying to be a cheerleader for them but to reduce frustration levels for all timeshare owners.  For most people, timeshare is frustrating enough already. 

I agree that the public perception of RCI’s image has suffered greatly and deservedly.  But I imagine all the corporate heads look at is the fact that they’re making nearly a billion dollars a year running the way they do.

All the best,

Jeff