Rental Car Shortage Has Some People Taking Drastic Measures
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The travel season has started and Americans are ready to hit the roads at last. It comes as no surprise that rental cars are in high demand. Rental car companies are trying their best to keep up with demand, but their depleted fleets are leaving customers frustrated.
Low rental car supply means rental cars are harder to book and a lot more expensive. That’s even before adding in the costs of any additional car insurance that you might need. What was once an afterthought for tourists is now a major headache. What’s causing the rental car shortage and how are people responding?
Why is there a rental car shortage?
Air travel nearly came to a halt last year and major rental car companies had a large number of unused cars. Much of the inventory was parked in empty lots or sold off to prevent further financial loss.
In 2020, CNET reported that Hertz sold almost 500,000 rental cars which led to great deals on used cars for consumers.
However, more people have been going on vacation as the number of people vaccinated increases. Rental car companies weren’t ready for the new surge of demand for rental cars, and couldn’t rebuild their supply of vehicles fast enough.
This situation has led to an unbelievable spike in rental prices especially in popular vacation destinations. According to CNET, in Hawaii, the cheapest rental vehicle costs $722 a day.
Automakers haven’t been able to help with rental car scarcity either since the semiconductor chip shortage is slowing production down.
What other options are there for car rentals?
Tourists are dealing with the frustration by getting creative. Many people have turned to solutions like renting cars from other people, rideshare services, or renting a car locally to drive to their destination.
Tourists in Hawaii especially, are saving money by renting out U-Haul trucks. The moving trucks are becoming a common sight in the state’s popular tourist areas.
One thing that vacationers are quickly realizing is not to wait until the last minute to rent a car. The cost of renting a car is no longer just a small add-on. Prices for renting cars have more than doubled in some locations. You’ll want to plan for this expense ahead of time if you’re hoping to travel and rent a car.
What are car rental companies doing to increase supply?
Bloomberg reports that car rental companies like Hertz and Avis are trying to address the high car demand in several ways. The companies are trying to purchase both low-mileage used cars and new cars to rebuild their supply.
In any case, even if companies can’t meet demand, they are seeing big profits from renting out cars at much higher rates than before. Hertz is bouncing back from entering bankruptcy last year with this increase in demand. You can use online sites like AutoSlash ahead of time to check car rental prices and try to save money.
How to save costs on rental cars
Once you finally find an affordable rental car, you’ll also have to think about whether you need rental car insurance. Your own car insurance policy will typically offer coverage on rental cars. If you have comprehensive coverage and collision coverage, there’s a good chance it extends to cover the cost of any rental car damages.
Jerry is a free app that can help you compare insurance options and buy with confidence. Jerry handles all the paperwork and phone calls to make it easy to shop for affordable insurance. Use the app to make sure you’re covered at home or on vacation for the best price.
