Avoid Car Rental Price-Gouging

Avoid Car Rental Price-Gouging

How car rental companies screw their customers, and how to avoid it.


Summer travel is unavoidable for many, despite the ever-increasing cost of it; gas prices, plane tickets, hotels, tours, hidden fees and, of course, car rentals.    Despite the economic slow-down (and resulting travel slow-down) car rental companies are reporting growth across the board. Many have sold enormous numbers of rental cars on the used-car market, creating an artificial shortage of rental cars that drives up the prices (something for which many of the biggest car rental companies; Enterprise, Hertz, Thrifty, and  Budget are being investigated). It seems they've also taken a page out of the airline's playbook, creating hidden fees that further add cost to the unwary traveler.

     One of the most insidious ways that car rental companies jack up prices is the insurance charges (referred to as LDW: Loss Damage Waiver) that can be a fourth to a third the cost of the daily rental price. What they won't tell you at the counter is that most car insurance policies already cover liability for rental cars. Some credit cards also carry this type of insurance (though check beforehand because they often carry gaps in the coverage).

    Another way the rental agencies price gouge is upon the return of the car. It's fairly common knowledge, but always gas up the car before you bring it back. If it comes back to the company with less gas than it left, the company will charge as much as double the actual price of gas to fill it up, plus charge fees for the filling.

    Companies will even charge an early-return fee, which could substantially increase the total amount of money for the rental. Often the early-return is increases your original daily rate, and could increase the total price by hundreds.

    Additional drivers, additional drop-offs (dropping the car off at a different location) and drivers under 25 years of age all incur extra fees as well (anywhere from 25% to 500% of the original price).

     To share a personal experience with the pitfalls of car rental, my wife and I went to Maine. We had reserved a sporty coupe for cruising the coastal highways but when we arrived we were given a sporty white Caravan (a minivan, for the non-car person). It was a better rate, so we didn’t complain and we were on our way. We returned the van on the day we said we would nearly a week later. However, because we weren’t aware of the 24-hour clock rule, though it was the correct day it was still past the 24 hour mark from which we rented a week prior. That and we’d returned it a quarter-tank short. The total bill was about twice what it would have been otherwise.

    Budget Travel recommends that travelers book beyond the major car rental companies, looking for smaller companies that stay competetive by not incurring massive fees. They also suggest booking with a car rental company outside of the actual airport rental counter. This avoids the ubiquitous airline fees and often will result in a lower daily rate. Finally make sure you research and prepare to find the best rental prices and read over agreements carefully to avoid incurring those extra fees.