With spring and summer travel season comes a familiar pandemic reality: Car rentals will be expensive.
Rental-car companies and analysts say they expect shortages to continue in the coming months due to the global chip shortage and other supply-chain constraints. With demand for rental cars expected to be high, plan to book early and brace for high prices in popular leisure destinations.
“People need to plan in advance this year; it’s going to be very busy,” says Stuart Stillman, owner of Guardian Rent A Car in Pensacola, Fla., which was sold out over Presidents Day and the following week.
Demand for rental cars is expected to be strong this spring and summer as Americans plan to get out for vacations. Since the beginning of the Covid-19 pandemic, the highest number of American travelers—93%—say they plan to take at least one leisure trip in the next 12 months, according to a recent survey from market-research firm Destination Analysts. Travelers are optimistic about the course of the pandemic and their ability to travel safely, the survey data show.
That demand is running up against a car crunch. Rental-car companies say they have started to restock inventory after selling off their fleets earlier in the Covid-19 pandemic, but supply is still limited. A spokeswoman for Enterprise Holdings, whose brands include Enterprise, National and Alamo, says the company is optimistic about its fleet purchase this year, but anticipates supply challenges will continue.
Over Presidents Day weekend, some airport rental locations in Florida, Hawaii and South Carolina were sold out days in advance, says Jonathan Weinberg, founder and chief executive officer of AutoSlash, a website that finds rental-car deals. Reservations in warm-weather destinations such as Florida are trending high for spring and into summer, the Enterprise spokeswoman says.
Mr. Weinberg says customers should expect similar pricing this spring break, compared with last year, about 50% more than 2019. Customers looking for weekend rentals in the next few weeks have struggled to find cars, especially for larger vehicles such as SUVs and minivans.
Pricing for the week before Easter in 2019 was $56 a day, according to Kayak search data. Over the same search period this year, prices are averaging $83 a day for the week before Easter, an increase over last year’s $64 a day.
Myrtle Beach, S.C., is the destination with the highest prices for April 9 to April 24, the weeks before and after Easter, with cars costing an average of $122 a day the week after Easter, according to Kayak, which includes prices from car-sharing services such as Turo and Kyte. Charleston, S.C., and Lihue, Hawaii, are the second and third most expensive destinations, respectively, to rent a car both weeks.
Better deals can be found in Seattle, which has the lowest prices the weeks before and after Easter, according to Kayak. Prices in Seattle are $68 a day the week before Easter, and about $69 a day in Portland, Ore., and Los Angeles that week, according to Kayak.
Larger vehicles will be hard to come by this year, analysts say, and renters who need minivans and full-size SUVs might not find affordable options—or any availability—if they wait too long.
Donald Horsman III, 33 years old, recently searched for a minivan to use on a two-week trip this summer with his wife and three kids. The family, which lives in the Phoenix area, plans to start its trip in Baltimore, where it will attend a wedding, and then continue on to Chicago to visit friends. Mr. Horsman says flights for his family of five cost about $2,000, and online searches showed the one-way minivan rental would cost at least $2,200 over the two weeks. Because it costs much more to drive a rental one way, he plans to minimize the days spent in that vehicle, and divide the trip into three separate rentals.
He expects to save at least $1,000 by renting in Baltimore for five or six days, then renting another car to drive to the Midwest, then another while in Chicago. He is also exploring renting through Turo while in Maryland and Illinois. “You gotta do what you gotta do to be creative,” he says.
People are also trying to rent other types of vehicles. Jon Gray, the CEO of RVShare, a peer-to-peer platform with more than 100,000 listings, says bookings have grown in the double digits year-over-year. There is still availability in popular markets for spring break, but he says supply will be tight for Memorial Day, July 4 and Labor Day weekends. Some of the most popular summer destinations include Yellowstone, Grand Canyon and Zion national parks, he says.
Rental rates in the summer of 2021 were 75% higher than in the summer of 2019, says Mr. Weinberg. While he doesn’t expect rates to be quite as high this summer, he says it is possible they could reach the same levels depending on demand and how many vehicles companies can add. Customers should expect to pay more than in 2019, and face challenges renting in certain popular destinations such as Hawaii, Alaska and Montana where vehicles are scarce, he says.
Tips for securing an affordable rental car
Plan ahead. Rental-car companies suggest booking early to better your chances of securing a rental. Mr. Stillman, of Guardian Rent A Car, says customers are booking as many as 30 days farther out than they did last year.
Call companies directly. Rental cars were scarce near Glacier National Park last summer, and another crunch is expected this year, says Lucy Guthrie Beighle, director of communications for Glacier Country Tourism, which represents eight Montana counties. She says rental fleets held on to more vehicles this year, but demand is expected to be high. She suggests travelers call rental companies directly if it appears they don’t have any inventory, or check listings through a car-share service such as Turo.
Leverage discounts. Some travel credit cards offer rental-car discounts. AAA, AARP, Costco and USAA offer programs that can provide members with discounts when booking rental cars.
Track prices. Rental-car prices change over time and even throughout the day. Travelers can compare and contrast prices on their own, or try using a service such as AutoSlash, which notifies travelers if there is a price drop to allow them to rebook.
Look into a car-sharing service. Peer-to-peer car-sharing services such as Turo have risen in popularity, but renters should look closely at insurance coverage before booking.
Check off-airport sites. You might find more availability if you’re flexible in your pickup location, says Greg Scott, spokesman for the American Car Rental Association, a lobbying group. Prices can also be lower at these locations.
Source: The Wall Street Journal