Experts Warn Rental Car Prices Will Continue To Climb

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Experts Warn Rental Car Prices Will Continue To Climb
As gas prices surge, the cost of renting a car is also climbing.

If you’re looking to get away this summer, it will likely cost you. On top of high gas prices and soaring airfare, rental car costs are also skyrocketing.

"Prices have definitely increased. I used to get a flat rate, but now I’ve noticed that rate is at least $70 more. And with gas prices, it’s starting to hurt you a little bit," said Maureen Mays, who rents cars weekly for work-related travel.

After several years of the pandemic derailing travel plans, Americans are ready to hit the road once again. The pent up demand is outpacing the supply or rental cars.

"Rental cars are the largest expense that a rental car company has and without anyone renting they had to go sell off as many vehicles as they could as quickly as they could," explained Jonathan Weinberg, the founder and CEO of AutoSlash.

AutoSlash compares prices and selection of rental cars. Weinberg said after selling off assets during the pandemic, many companies are struggling to replenish inventory because of supply chain issues, a chip shortage and other delays. Some are even buying used cars instead of new ones.

"It was hoped by this summer there would be a little bit of easing up of the inventory situation but so far we haven’t seen it," he said. "And we don’t expect the situation to improve until late this year."

Weinberg is finding prices exceeding $100 per day in popular spring break destinations. Outside of the Lower 48, costs are above $200 per day in Alaska and Hawaii. Some of the most expensive options are near National Parks. AutoSlash found cars for more than $300 per day near Glacier National Park.

"Certainly high gas prices are something weighing on consumers’ minds, but from what we’ve seen so far it’s not tamping down the demand for car rentals at all," Weinberg said.

He recommends starting early when looking for a rental car. You may want to begin planning eight to 10 weeks before a trip if you’re looking to rent larger vehicles, like minivans and full sized SUVs, which are especially hard to come by. You should be looking four to six weeks in advance for economy options.

In addition to early planning, Weinberg said discounts through AAA, AARP, Costco or other clubs can sometimes offer 40-50% off rental car prices.

If your travel plans involve shorter drives, you may consider opting for a taxi or using a rideshare app to save on prices. Car sharing companies, like Turo and Get Around, which function like Airbnb with owners listing cars for rent, may also offer cheaper options. But many also come with delivery fees and require a more extensive insurance background check before renting.

In 2021, travel bloggers also began suggesting alternatives like box trucks, service vans or rental vehicles from home improvement stores. They may offer less expensive daily rates and mileage, but Weinberg cautions they may not be a practical solution for getting around.

He said the challenges facing the rental car industry are likely to stick around through the year and prices may get higher before they come down.

This story was originally published by Catherine Ross on news5cleveland.com.