Why I Avoid Renting a Car…
You may have noticed by now that I rarely write about renting a car. Which means I barely ever write about car rental loyalty companies. If I ever do rent a car, I usually bank the points directly to an airline or hotel partner because I so rarely rent a car (maybe once a year at most).
An article from CBC Marketplace triggered the idea for today’s post: Hidden camera footage catches misleading sales practices at car rental agency.
I put in italic some of the key points bought up in the article, and I provided my thoughts on the rest of the post.
Insurance Charges
- Article mentions: Unnecessary insurance: there may be times when employees up-sell customers on insurance they may not need.
- Being charged a fee (e.g. of $11.95 per day) for using our own credit card insurance coverage.
There is a whole debate about what insurance we are required to purchase by law and what we can incrementally purchase for more protection. The point is that some insurances cannot be avoided and some can be.
From my personal experience, even if you remind the car rental agency that you already have existing insurance coverage (such as with your personal credit card or other means), the car rental agency will usually push their insurance with responses such as: “those companies make it hard for you to file a claim, our process is much simpler.” Whether true or not, I personally see it as a high pressure sales tactic. At the end of the day, the company’s goal is to make profit so I cannot blame them for trying to make a sale, but it does make the experience very uncomfortable.
Surprise Charges
- Surprise charges: charges that were not as transparent upfront, such as
- daily “VLATR” fee
- daily “Energy Recovery Fee”
- daily “MTFC” fee, also known as a vehicle maintenance fee
- daily border-crossing fee for anyone heading to the U.S.
- service charge for vehicles that use the 407 toll highway (a highway in the Greater Toronto Area)
- “AMF” fee, also known as an airport maintenance fee
Whether these fees are justified, the fact that they are broken down so specifically does make it seems more like a surprise charge if they were not included in the advertised price.
In North America, when you pay for things, especially food, the price pretty much never includes taxes and tips. If you travel to pretty much anywhere else in the world, you pay what you see. Whatever “hidden” costs there are is already included in the price, which I will elaborate in the next section.
Two Ways of Thinking
This may sound controversial, but I believe this has to do a little bit about culture. In North America, there is this whole movement about being “transparent”. People say things like: “I want to know where my money is going. I want a full breakdown, etc.” Well if that’s the case, then your bill is going to be broken down, which opens up more questions like: “why am I paying for this and that?”
Conversely, a retailer can just include everything into one price. You pay it, no questions asked on where the money goes, which is how it works is many countries around the world, outside of North America.
I’m sure that if I asked 100 people about this, I would probably get 100 different opinions on the matter. Personally, I would rather just see 1 price, and not worry about the breakdown of the cost. Instead, I rather see more competition in any industry, so that companies can compete with each other to drive down the prices. At the very least, if there is more competition, we can at least compare prices. I personally rather not get caught up on the breakdown of where my money goes, I rather spend my time shopping around the different “all inclusive” price tags. It is a pain to shop around when the final price is not advertised, which makes it feel misleading.
However, price is only an issue in the absence of value. So are these high prices justified? I will discuss more in the next section.
Thoughts on the Industry Overall
Remember the days when you can rent a car for $9.99 a day, plus tax, over the weekend and very minimal hidden costs? There were days when you can rent a car for less than $15 a day all-inclusive. If you compared that to $30-$40 a day, I don’t think you will question too much where your $15 is going. The breakdown of the cost becomes a bigger issue when the price doubles, then we ask whether the retailer is receiving a 100% markup?
What I am trying to say is, when the cost is high, every single dollar gets highly scrutinised. There probably are justified reasons for increased costs in car rentals, such as:
- inflation
- higher maintenance costs
- high demand (so no need to drop prices)
- low competition
- etc.
The challenge is if all those factors are working against consumers, it is inevitable to avoid higher costs to renting a car. And gone will be the days of renting a car for $15 a day.
What I do
To make my life simple, I actually just avoid renting a car whenever possible and put my money towards other methods of transportation like:
- shuttle services
- Uber/Lyft/taxi
- Trains
- My personal favourite: all-inclusive passes (e.g. Japan Rail Pass or Swiss Travel Pass)
Although there is less flexibility on the schedule, I would rather not have to worry about things like:
- Picking up and returning the car
- Insurance (especially insurance claims)
- Damaging the car
- Parking
- Tickets for traffic violations (especially when I am not familiar with the roads)
I remember being on a road trip in the U.S. and I got a speeding ticket. I was driving on a 50 mile and hour road, that dropped to 30 mile at a corner and I missed the sign. I was ticketed for driving at 45 miles and hour. I was driving at 45 miles an hour to stay under the 50 mile and hour speed limit to avoid a ticket. Guess what happened anyway!! Now my eyes are glued to speed limit signs, so do not distract me when I am driving…
Basically, when I am on vacation, I want to relax and not add more stress. So I rather give up the convenience of having a car to avoid headaches.
What are your thoughts on renting cars? Please let us know in the comment section below.
In a high density country, and/or for getting around around in cities, public transportation is often best. In areas where the driving is messy but with low wages (e.g. Egypt or India), hiring a car and driver is often best.
In a low density country with good roads & driving behavior, renting a car often wins. It’ll be hard to hit the good natural scenery in a country like New Zealand or Ireland without a car. If you have a group, the car often wins here. Tours charge per-person, and can get prohibitive quickly. You can also save a bit of lodging money by choosing a more suburban location. For more dense countries (e.g. Italy or Switzerland), it becomes a bit of a chore to visit cities en route, as you may need to figure out where to park & ride
Thanks for sharing your thoughts with us enthusiast!
Canada, while a great country, is famous for ripping off their own. That’s why Canadians come to the US to shop. In Canada everything is cheaper except hockey pucks. Seriously, I visited Canada and bought some….so cheap.
This article is no different. The CBC article, which I read before I saw the link here (showing I’m no American idiot) is about Economy Rent a Car. What? Yes, Economy, a CANADIAN company. You will not find Economy Rent a Car in the US . The Canadian company, in true fashion, rips off people.
Hertz is not like this. Try it in any American city.
You might be able to get by without a car in Vancouver but you cannot get by without a car in Hope, BC
Thanks for sharing your thoughts with us derek!
typo….everything is more expensive in Canada except hockey pucks
I recently rented a car in Portugal for 12days as I was driving from Lisbon to Porto over that period.
However, once I checked in at Lisbon for e.g., I would park in the hotel covered parking and then Uber around as it would save me finding parking spots and not have to circle back to same spot.
Then after a day or two jump in the car and drive north.
Thanks for sharing your experience with us CanadaPointsGuy!
My sister and went to Southern California a couple weeks ago and we decided to rent a car to tour around from San Diego to Palm Springs. We spent hours researching car rentals on the internet and were pretty happy with the prices….until we saw all the hidden fees. A car quoted at $17/day ended up being almost twice that with all the extra fees. We finally settled on Avis, mostly due to internet search fatigue and frustration. The price was quoted in Canadian dollars (important to us as the exchange rate is nuts right now!) and we had to pay up front which we normally would not do but we bit the bullet and booked the car. It turned out to be a good thing we did because when we got to the rental agency they were out of Economy size vehicles but, since we had already paid, they had to upgrade us to an SUV at no charge. They gave us the hard sell for insurance, which we declined. The woman at the counter was miffed that we didn’t buy into her sales pitch. In fact, the entire car rental transaction at the counter was difficult and time consuming because they did not want to give up without getting more money out of us. We held firm, finally got our red Jeep SUV, and drove away with relief. The vehicle was great and we had no other problems. The Avis return was actually super easy as well. So I caution others to avoid the pitfalls at the counter. Know what you want and how much you want to pay before you get to the counter and hold firm with the salesperson. Don’t be pressured. And drive safely
Thanks for sharing your experience and insights with us Wendy!
Not renting a car is fine if you’re on your own… but honestly, you can’t see the Dolomites on public transit. When we went in May a couple of years ago, it was divine as that’s the month that everything is quiet and closed down. WE found a regular BnB in Badia ( not an AirBnB… that company is horrible ) and the car gave us the freedom to cart 4 people around. Not having a car when your group gets more than 2 is SERIOUSLY limiting. If you want to take the road less traveled in Hawaii, you can spend $700 on a half-day tour for 4 people see a sunrise on Haleaaka, or pay $250 for a week’s worth of freedom to do whatever you want, whenever you want it. What annoys me most though about car rentals is not the car rental itself it’s the usurious $25 parking fee from the hotel in a non-city location. NOW THAT is what I call a scam.
Thanks for sharing your thoughts with us Gary A!
I largely agree with you, whenever possible I try to avoid a rental car for the reasons you listed in addition to saving the cost. Though as others have mentioned sometimes its just not possible due to geographics and where you are visiting. Consequently, even if I’m visiting an urban city, I am also usually on vacation where time is not always a luxury I have so if a car presents an opportunity to save a great deal of it I will do so.
To your point in the article about fees and transparency in NA, i’ve found for me rentals in NA when shopping online were largely intuitive and not many non-sensical fees listed and the price i saw on the reservation was the price i was ultimately charged. Having said that there is always some kind of sales tactic when you go to pick up the car that you have to dodge.
Thanks for your feedback Daryl. Personally I think it came down to demand and supply. People are still willing to rent a car even though fees were added after. Maybe this may change going forward since car rental is probably down at this point in time…