Can't afford $2,500 for new rims?
How about renting them?
Rent-to-own outlets supply credit-starved customers the basics of American living: sofas, TVs, refrigerators and washing machines. But some industry veterans have begun to specialize in a chrome-encrusted niche: performance tires and custom wheels.
Can't afford to lay out $2,500for four wheels worth of shine? No credit? No problem. You can rent them, and eventually own them, sometimes for double the cash purchase price.
Ego is fueling the buying spree, said Larry Sutton, the president of Rent-n-Roll, a 60-store chain that claims to be the biggest of its kind. "We want to feel good about the way we look: 'I don't want to wait for that. I don't want to save for that. I just want it.' "
Tampa-based Rent-n-Roll and Rimco, a 20-store chain that is an offshoot of Buckhead-based Aaron Rents, have wheeled into the metro Atlanta market with mini palaces of chrome.
It's not uncommon for customers to come straight from an auto dealership to outfit brand new cars from — Jaguars to Dodge Magnums.
Others, like Javier Miranda, 24, hope chrome will add status to tired rides.
Miranda, a house painter with an 8-year-old Dodge Durango, picked out a rolling statement — gleaming wheels, bold and 22 inches wide — from a Rent-n-Roll showroom in a string of check cashing stores, pawn shops and discount merchandisers on Memorial Drive in Stone Mountain.
"He's buying it cause he likes the girls," said Miranda's sister-in-law, Frances Uribe.
A 39-year-old housewife and mother of four, Uribe said she plans to buy a set of wheels for her husband's truck so it will look good when she borrows it. "Girls like this stuff, too. We like to be cruising around."
The price tag for Miranda's wheels, tires and $13 a week in insurance fees: $2,319.76. That's hundreds more than he makes in a month, he said. And it'll cost significantly more if he doesn't pay it off in the store's 120 days, same-as-cash period.
Sales manager Corey Croker advises Miranda to be careful. "Everybody says they are going to do it in 120 days, but things come up in life."
Consumer advocates criticize the high fees some traditional rent-to-own shops charge customers already short of money.
"Rent-to-own contracts are really disguised loans that disguise astronomical and undisclosed interest rates," said Lauren Saunders, an attorney for the National Consumer Law Center, a Boston-based nonprofit. She said she isn't familiar with particulars of the wheels niche.
Industry proponents say rent-to-own allows customers to spread out the cost of a purchase without credit checks. And, if rent-to-own customers change their minds, they can turn in the wheels and stop paying.
Trends shift quickly, said Sutton, the president of Rent-n-Roll.
Spinners — wheel covers that spin on their own — were hot, then faded fast, Sutton said. Now, a fast seller is wheels with centers that match a car's paint job. A full set of wheels and tires at the chain usually have a cash price between $1,000 and $2,500. But the cost can balloon, Sutton said. One customer recently agreed to pay $18,900 to have a Hummer outfitted with tires and 28-inch, three-piece rims.
"With the cultural shift we are going through, there is a have-it-your-way mentality," said Peter MacGillivray of the Speciality Equipment Market Association. "For a lot of people, their vehicle is a reflection of their personalities."
Aftermarket custom wheels generated $4.5 billion in sales last year, up 46 percent from 2001. The Association of Progressive Rental Organizations, a trade group, says it knew of only 15 custom wheel rent-to-own shops nationwide five years ago. Now, it estimates there are at least 160, including seven chains.
But some in the industry worry that demand for custom wheels could go flat.
Aaron Rents, a giant in the traditional rent-to-own industry, launched Rimco in late 2005 to tap into custom wheels. After studying the market and opening 20 Rimcos, including three in metro Atlanta, the company is making big changes.
"We have reshaped the store to get away from its trendiness and flashy wheels," said Ken Butler, president of Aaron Sales and Lease Ownership and Rimco.
He plans to add items typically found in basements, garages and yards, including grills, washers and dryers, pressure washers and kids' bicycles.
Butler also said he will switch Rimco from a rent-to-own concept to one offering customers credit.
Rent-to-own carries a stigma some potential customers don't like, he said. And the switch helps Rimco avoid customers wearing out tires less than midway through a rental agreement and returning them to the store to be thrown away, he said.
Executives of both Rimco and Rent-n-Roll said they expect to open more stores this year.
Rent-n-Roll's Sutton got into the business after selling a chain of traditional rent-to-own stores.
He said his average wheel customer has an annual household income of $45,000, well above that of his typical customer in traditional rent-to-own. But the typical wheel renter is still financially stretched, Sutton said.
But what surprised Sutton is that a third of his customers are women.
"They are more sensible in their wheel choice than men are," he said. "Men just want the biggest damn thing they can put on their car."
REVVED UP ABOUT AFTERMARKET GEAR
All specialty automotive equipment sales (not just wheels)
- .....$17.65 billion
- .....$19.33 billion
- .....$21.20 billion
- .....$23.24 billion
- .....$24.86 billion
- .....$25.90 billion
- .....$26.84 billion
- .....$28.91 billion
- .....$31.45 billion
- .....$34.28 billion
- .....$36.72 billion
Aftermarket custom wheel retail sales
Year......Retail sales (in billions)
Source: Specialty Equipment Market Association (SEMA)
© 2007 The Atlanta Journal-Constitution