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Renting a Vehicle

Written by Kobus on March 20, 2011

Rental in AustrailiaHave you ever tried to rent a vehicle and end up staring at the guy behind the counter like a deer in headlights? An hour later you’ve upgraded to a car you don’t need and are unknowingly paying for a pile of unnecessary insurance and other hidden fees. This article will help you decide whether to rent a car and how to avoid these extra costs.

Is renting a smart choice?

  • How long will you rent the vehicle for? This sets the base cost.
  • How far will you drive? Mileage costs can be very high for long trips.
  • Where are you going? Countries have difficult rules for vehicle rentals, for example in the U.S. you have to be at least 25 years old to rent a car.
  • Crossing any borders? Many countries don’t allow rental cars to cross borders, and most require piles of paperwork if you aren’t a citizen.
  • Is your trip one way? This usually adds an additional fee.

We chose to buy a vehicle for our three month overland loop through East Africa, and sold it for a 20% loss after the trip. The cost of repairs, plus the loss from the sale was roughly $3000. Renting would have cost more than $19,000.

For our five week trip through Australia we rented a car. For the entire trip the rental cost $1200, and we dropped off the car on the other side of the country. Buying a vehicle would have been a huge hassle and risk. Given our tight schedule, it was unlikely we would have been able to resell a car without a significant loss.

Mileage Costs

Rental agencies usually charge daily or weekly rental rates. Additionally, you may have to pay based on how far you drive. Some companies offer unlimited miles / kilometers and others allow a limited number free before additional charges apply.

One-way Costs

If you are planning to drop off a vehicle in a different city than you rented it in, be prepared to pay a one-way fee. If doing a loop is out of the question, check with rental companies for one-way deals. Popular routes are often driven in one direction. Diving in reverse may save you the one-way fee and may even come with other discounts.

Shop Around

Compare the competition, especially in tourist areas. Many companies offer lower rates for weekend or week-long rentals. You may even find discounts for monthly rentals.

High Season and Holidays

Rental prices fluctuate depending on the time of year, especially for popular tourist destinations. Costs can double around holidays when more locals travel.

Get Insurance Elsewhere

Rental agencies will always offer many varieties of car insurance. While you should insure the car, you don’t have to buy insurance from the renter. Check to see if any of the following cover your rental car insurance:

  • Your own car insurance or homeowners insurance
  • Your employer, if you are traveling on business
  • Your credit card may provide insurance for the rental car if you pay with your card
  • Automobile club memberships like AAA

Avoid Airport Taxes

Airport rental agencies are more expensive because of airport surcharges, drop-off fees and local taxes. All of those fees are passed straight to you. Avoid the airport for a better deal.

Vehicle Size

Unless you are planning an overland expedition or are transporting a football team, rent a compact vehicle. Compact vehicles get better gas mileage and cost less than larger vehicles. Most will fit three people with their backpacks full of camping gear.

Manual Transmission

Depending on your destination, requesting a manual transmission can save a pile of money. At Hertz in Australia we were upgraded to a size larger car for free, just for requesting a stick shift. In countries where automatics are rare, expect to pay a premium for that option.

Tickets and Tolls

Many rental agencies will charge extra for any tolls or tickets received while renting the vehicle. It stinks getting a $100 ticket from a speed camera two months after your trip ends, but the $50 fee from the rental agency is salt on the wound.

What Insurance won't Cover

Make sure the insurances covers all of the places you plan to go. If you are planning on camping down a long dirt road, make sure that’s covered by your insurance. Most rental agencies stipulate that driving on anything other than pavement is not insured.

Be on Time

Penalties are steep if you do not drop the car off on time. Plan ahead so you don’t get stuck with extra fees.

Forget the Bells & Whistles

Avoid the extra features. If you need a GPS or a child seat, bring your own. It means a few extra pounds in your luggage, but it could save you some cash.

Drivers Licence

Check destination requirements to verify your home drivers license is valid. In the U.S. international driving permits cost about $10 and can be obtained through AAA and the American Automobile Touring Alliance and are valid in more than 150 countries.

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