Car Rental Fees

Car Rental Fees

As car-rental companies add fees and surcharges to boost their bottom line, more travelers are suffering the agony of receipt.

Don't believe the base rate. That should become a mantra among consumers, as special fees, taxes, and other tacked-on charges pad car-rental bills to unrecognizable levels. The industry is hurting—ANC Rental, parent of Alamo and National, is in Chapter 11, as was Budget before it was acquired last year by Cendant, which also owns Avis—so companies are looking for revenue wherever they can find it.

A Travel + Leisure staffer discovered this the hard way when he booked a car at Milwaukee's airport over the Christmas holiday. Though the $29.98 daily rate he was quoted was attractive, the three-day rental with extras ended up costing $267.33—more than his airfare from New York and nearly three times the basic rate.

The rental companies aren't the only culprits: in recent years, many state and local governments have added or boosted their own surcharges. One study found that since 1995, such fees have gone up in three out of four major world cities.

Besides the various taxes and fees indicated above—which vary by state—rental companies usually charge more for using a second driver; dropping the car off at an alternate location; keeping the vehicle for longer than you booked it; being under age 25; accruing frequent-flier miles for the rental; and requesting additional equipment, such as a child safety seat or ski rack.

Whether you reserve a car on a Web site or by phone, be sure the price you're quoted contains all the mandatory and optional add-ons so your rental doesn't end up busting your budget.

Anatomy of a Rip-off
Basic rates have remained stable in the last few years, with leisure demand making up for the falloff in business travel. Our staffer's total so far for a three-day rental: $89.94

Local governments love to tax visitors. Why?Because they don't vote in municipal elections. Since 1994, car-rental taxes have gone up 161 percent in Honolulu and 382 percent in Boston. $166.06

A negotiated corporate discount reduces the basic rate by 10 percent. $80.95

Such taxes frequently fund local projects, such as sports arenas; the 3 percent Expo tax is underwriting Milwaukee County's new convention center. $170.65

Most rental firms now recoup the fees they pay the airport by passing them along to the customer. (Milwaukee's recently went down to 8.6 percent from 11.11 percent.) So much for that corporate discount. $89.94

Bring back the car with less than a full tank and the rental firm charges you excessive rates to top it off—in this case, nearly $40 for half a tank. Tip: As you drive out of the airport, look for a place to fill up when you return. $210.63

The "loss damage waiver" protects the customer from liability for damage to the car. Before you rent, find out whether your own auto insurance or credit card already covers you. A 2002 study found that nearly one in four renters bought damage waivers because they didn't know if they already had coverage. $152.91

More optional insurance, coveringpersonal accident medical costs (PAI), personal effects in the car (PEP), and additional liability from an accident (ALI). Again, your medical, homeowner's, or auto insurance might render these unnecessary. GRAND TOTAL: $267.33

Promoted Stories
Explore More
More from T+L