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16:25  17 april  2021
16:25  17 april  2021 Source:   mediafeed.org

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a car parked in a parking lot: Hertz rental cars near Detroit Metropolitan airport. REUTERS/Rebecca Cook © REUTERS/Rebecca Cook Hertz rental cars near Detroit Metropolitan airport. REUTERS/Rebecca Cook
  • The US doesn't have enough rental cars due to the computer chip shortage, smaller fleets, and an uptick in travel.
  • In extreme cases, rental vehicle prices have skyrocketed to $700 a day.
  • If you're planning a spontaneous summer trip, your rental car could be more expensive than your flight.
  • See more stories on Insider's business page.

A rental car could consume the bulk of your vacation budget if you don't plan ahead, experts warn.

Airline and hotel costs are still lower than pre-pandemic prices, Nerdwallet recently reported. But right now, the US is facing a massive rental-car shortage that's causing vehicles to either sell out or sell for high prices.

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As a result, if you're planning a spontaneous vacation that will require a rental car, be prepared to pay more for your vehicle than your flight or accommodations, especially if you're looking to visit popular destinations like Hawaii, Florida, Phoenix, Arizona, and Puerto Rico.

"People are quickly realizing that they need to take the cost of the rental car into account because it's no longer just an add-on," Jonathan Weinberg, the founder and CEO of AutoSlash, told Insider. "It literally could be the majority cost of your trip, so folks who are planning things last minute are unpleasantly surprised by it."

Plan ahead

a car parked in front of a store: Hertz. Justin Sullivan/Getty Images © Justin Sullivan/Getty Images Hertz. Justin Sullivan/Getty Images

Rental car company Hertz is already expecting "strong demand" through the summer, which could cause decreased availability in certain markets, according to an email statement sent to Insider. Enterprise echoed this in its email statement sent to Insider, adding that it has been working to grow its fleet size to address this increasing demand.

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If you're wondering how to avoid these issues ahead of your summer vacation, consider planning ahead, although you could still see prices that are double or triple the typical costs. But if you'd rather book a last-minute trip to a hotspot like Florida, be prepared to see rental car prices about five to 10 times the average.

Rental vehicles in Hawaii averaged at about $50 a day two to three years ago. Now, some are going for $500 a day, according to Weinberg. And in extreme cases, prices have even hit $700 a day, Chris Woronka, a senior hotel-and-leisure analyst at Deutsche Bank, told Insider.

a man standing in front of a car: Enterprise. Carlos Osorio/AP Photos © Carlos Osorio/AP Photos Enterprise. Carlos Osorio/AP Photos

There's no one specific issue that's been causing this problem: the rental-car shortage is a result of a "perfect storm" of reasons, according to Woronka. For starters, there's currently a rising number of travelers planning post-COVID-19 "revenge vacations." This is then being compounded with a decreased fleet size after several car rental companies sold off parts of their fleets during the COVID-19 in order to save money.

And at the moment, any chance of increasing fleet sizes again is being hindered by skyrocketing used car prices and a lack of new cars due to the computer-chip shortage.

"No matter how much shuffling the rental car companies do with the vehicles that they have on hand, I just don't think it's going to be enough," Weinberg said.

Read the original article on Business Insider

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usr: 4
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