Car Rental: There Must Be A Better Price!
Let's go to the mailbag today for a reader question about getting gouged by a car rental company:
|Rental Car Savings!|
"While traveling to Tulsa this week I rented a car from Budget Rental. The car's cost for two days was $184.
That was extremely high and I refused to do it, so I continued research on the internet and found that all the cars in the middle of the week were as much as $100 a day. So I went back to Budget and found the next day that they had a car for rent for $100 for 2 days. I immediately rented that car. When I got to the airport in Tulsa I went to the counter to get the car from Budget. At that time they quoted me a price of $184. I showed them on my phone the email confirmation that said $100. Budget then told me that quote is from the downtown location which was 4 or 5 miles away. I asked how I was supposed to get down there and if they had a shuttle.
The answer was simple...you have to take a cab. Well I was a bit peeved but went outside and a cab was waiting. I asked the cab driver how much to take me to the downtown location of the Budget Car Rental. He told me $30. After I got up off the sidewalk, I asked if I had any alternative and he said yes you can walk.
I thought about that, however crossing the freeways and busy highway is would have been a bit risky. So I paid the $30, got downtown to the Budget car rental place, and asked if I had to bring it back here and have another cab ride back to the airport explaining the circumstances to the customer service person. She said, well no we can arrange it for you can take this right straight back to the airport. When I asked why the prices were so high, I was told by the budget representative that it was a "supply and demand situation".
I responded to that by telling them that I thought it was a greed situation accompanied by circumstances where people had no choice.
Thank you for your time and hopefully you can get this message to Dr. Penny Pincher so he can go undercover and find out what the deal is...
An Anonymous Dr. Penny Pincher Reader"
Thank you AADPPR for sharing your interesting story and providing an idea for an article that can help save people money for car rental expenses.
Week Day vs. Weekend RatesMy first observation is that renting a car during the week can be quite expensive compared with weekends. I think this really is related to supply and demand. During the week, there are lots of business travelers with expense accounts who will pay top dollar for rental cars. On weekends, most car rentals are for leisure and people are more concerned about getting a good price.
If you have a choice, try to rent a car over a weekend instead of during the week. The prices can be something like half as much.
Try to Get the "Replacement Car" Insurance Company RateMy next observation is that $184 or even $100 for a two day car rental seems pretty high. The last time I rented a car, I got a Chevy Sonic for about $25 per day. I told the car rental agent that my car was wrecked and my insurance would only cover $25 per day, so I needed something in this price range. I didn't think you could even get a rental car for $25 per day, but they came up with one.
Car rental companies give their best deals for providing a replacement car after your car is in a wreck. This type of car rental provides some long term rentals with relatively low mileage and is profitable business for the rental company. Even if your car was not in a wreck, you can still try to get the rental company's best rate. You can say that your insurance only covers $25 per day and see if they offer you something in this price range.
When I got my $25 deal, my car was actually wrecked, but it seems like this request could work even if your car is not wrecked.
For more on this strategy, see TIP 4 in confessions from a former Enterprise Car Rental Employee.
Supply and Demand vs. GreedI liked your comment that you thought the reason for the jacked up prices was a "greed situation". Car rental companies, like other businesses, are going to try to get as much money as they possibly can for their goods and services.
If you are renting a car in a high demand market where plenty of people are willing to pay $184, then the car rental company has no motivation to lower the price. Why would they take $100 if they could get $184 from the next person to walk through the door?
On the other hand, if the car rental company has tons of cars just sitting there with no one renting them, they might be willing to rent one for a very good deal. Making some money is better than making no money. But in order to be able to drive a bargain, you need a situation where there is not a lot of demand.
So, I would always try to bargain on the price for a rental car, but if demand is high it might not work. Your best chance to negotiate a good deal is by talking with the sales person, being friendly, and talking them into a good price by encouraging them to find something less expensive.
Bargaining on price may or may not work, but is worth a try. The agents have a lot of flexibility in setting prices, so you might be able to keep asking for something less expensive and end up with a low price.
The Cab RidePaying $30 for a cab ride was expensive, but you ended up saving $54 on your car rental even after the cab fare, so this was a good move.
One idea that came to mind when reading about the cab ride is Enterprise. Enterprise car rental will pick you up for free when you rent a car. I wonder if you could have the Enterprise a few miles away with a lower rate drive and pick you up at a convenient Enterprise location that has a higher rate? Maybe you could get the lower rate without paying for a cab ride...
Another idea on saving on a cab fare: I have never tried it, but Uber and Lyft provide some very cost competitive services if you need a ride. I would guess these services would be about half the cost of a cab ride, but you might have to wait a bit compared with taking the cab that is already there.
Car Rental Add-on ExpensesNext time I need to rent a car, I'll go undercover like I did in this investigation of Rent-to-Own stores and see what I can learn about how rental car companies extract money from people. Here are some car rental company tricks to watch out for:
- Supplemental Insurance: Your existing car insurance likely covers you. Paying for extra insurance is very profitable for the car rental company.
- GPS fee: You can use your smartphone instead of paying a few dollars a day extra for a GPS in your rental car. Or use a paper map.
- Satellite radio fee: I hear that car rental companies are charging a few dollars a day extra for XM or Sirius satellite radio, even if you didn't know your car had satellite radio and didn't use it!
- Gas fee: If you turn your rental car in without filling up the gas tank, you can get hit with fees and pay extra money for the car rental company to put gas in the car. Try to fill it up yourself on your way to the rental car lot when you turn the car in.
Overall, it sounds like you saved some money by shopping around and taking a cab to get a much lower rate a few miles away. Nice work!
Dr. Penny Pincher