If you’re planning a domestic road trip this summer in the U.S., you may want to think twice about renting a car. There is a massive rental-car shortage in the U.S., causing prices to skyrocket up to 700 USD a day in some popular destinations!
What Caused The Rental Car Shortage?
The rental car shortage is due to several factors that have led to “a perfect storm,” according to Chris Woronka, a senior hotel-and-leisure analyst at Deutsche Bank.
When the COVID-19 pandemic began, it halted travel around the country – particularly business travel. Major car-rental companies like Hertz, Avis, and Enterprise had to sell off large portions of their fleets to save money and avoid bankruptcy.
As more people are booking travel in warm destinations after a year of no travel, it is causing significant problems.
Car rental companies have been moving vehicles around to hot spots to counter demand, but this means locations where cars have been removed could have limited availability in the future, creating a balancing act issue.
“No matter how much shuffling the rental-car companies do with the vehicles that they have on hand, I just don’t think it’s going to be enough,” said Jonathan Weinberg, the founder and CEO of AutoSlash.
To make matters worse, a computer-chip shortage has begun to harm the auto industry, making it difficult and expensive for rental car companies to restock their fleets quickly.
“It’s like everybody going to the fire exit at once in a movie theater,” Woronka said. “It’s an unusually broad and quick surge in demand that’s being exacerbated by this shortage of new-car availability.”
How Does The Car Rental Shortage Impact Travelers?
The lack of availability of rental cars means higher prices for travelers, especially in hot tourist locations in Hawaii, Florida, Arizona, and Puerto Rico who are being hit by a “car-rental apocalypse,” according to Forbes.
According to Weinberg, the average car rental in Hawaii cost about $50 a day two or three years ago. Now some rental cars are going for over $500 a day.
Weinberg said that travelers looking to book a rental car a week in advance in places like Florida could see prices about five to 10 times the average.
“People are quickly realizing that they need to take the cost of the rental car into account, because it’s no longer just an add-on,” Weinberg said. “It literally could be the majority cost of your trip, so folks who are planning things last minute are unpleasantly surprised by it.”
Tips to Deal With The Rental Car Shortage
While rental cars are usually booked after hotels and flights, travelers should check to see local car rental prices before making any plans.
Last-minute car rental prices will likely be higher (or possibly not available at all), so travelers should shop early to secure a car.
Lauren Luster, a spokeswoman for Hertz, said in an email to the New York Times:
“Customers to book as early as possible and at the same time they’re making other travel arrangements”.
Once you’ve made a reservation, you can also use AutoSlash to track and monitor your reservation for a price drop. It will automatically rebook you at the lower rate!
Using your rental car membership status may also help. While it doesn’t guarantee a car upon arrival, most rental car companies have special lines and preferred rates for members, improving your chances of securing a vehicle.
Another strategy travelers can use is to search for car rentals in other neighborhoods outside of the airport, which may have more availability. Travelers can also look at alternative options such as car-sharing services like Turo.
If you can’t find a rental car for an affordable price, consider planning your vacation later in the summer. Demand For rental cars often slows down in September, which could give these companies some breathing room and time to get more supply.
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