How Much Does it Cost to Rent a Car?

If you’ve rented a car lately, you know that prices are far higher than before the pandemic. By some estimates, rental car prices rose nearly 50% from July 2019 to July 2022. Prices have dropped slightly in recent months, but they’re still at levels much higher than the pre-pandemic average.

The bottom line is that if you need to rent a car for travel or other purposes in 2023, you can expect to pay more than you once might have.

Average daily car rental cost by company

Here’s a snapshot* of car rental costs from several major companies at four airports: Atlanta Hartsfield-Jackson, New York City JFK, Los Angeles International, and Chicago O’Hare.

*Source: Rentalcars.com search for intermediate-size rental cars. The search was conducted on March 23, 2023, for a rental period to begin on April 20, 2023 and end on April 21, 2023. These costs are provided for comparison purposes only.

What factors affect car rental prices?

You owe it to yourself to shop around when looking for a rental car. As our search shows, rental car costs can vary between companies. Here are some other factors that can affect the cost of a rental.

Type of rental car

The type of car you rent (size and luxury features) can significantly affect what you pay.

Avis, for instance, offers the following car options at Hartsfield-Jackson Atlanta International Airport. You’ll notice a significant price jump from the standard to the full-size category, and another significant jump for the special and luxury categories.

Source: Rentalcars.com search for rental cars from Avis at ATL airport. The search was conducted on March 23, 2023, for a rental period to begin on April 20, 2023 and end on April 21, 2023. These costs are provided for comparison purposes only.

So be sure to have a strong sense of what you need when booking a rental. Are you traveling solo for just a couple of days with a minimal amount of luggage? Perhaps an economy car will do. Do you and your spouse have three kids with lots of luggage in tow? It may make sense to pay for a van. Are you and a couple of girlfriends splitting the cost of a girls’ weekend and want to splurge? Maybe going in style with a luxury car is the right choice.

Rental car pickup location

In our comparison of rentals at four major airports, you’ll note differences in cost: New York JFK is more expensive than the other three rental locations shown. As with many things, rental cars are subject to the laws of supply and demand. Renting in a popular tourist spot or during a location’s busy season (for example, in south Florida during spring break week) may contribute to your costs.

Renting at an airport instead of an off-airport location may also factor into costs. If you can get transportation to and from a non-airport rental agency (consider a taxi, rideshare, or public transportation), you may save a lot of money.

How far in advance you book a rental car

Bad news for those who like to travel spontaneously: How far in advance you book can also affect your cost. For example, booking on a Tuesday for the upcoming weekend will cost more (and possibly limit your options, as some car types may be sold out) than a rental you book several weeks or months in advance.

Age of the rental car driver

One final factor impacting cost is the age of the driver. Rental car companies view younger drivers as riskier to do business with than older drivers and charge them accordingly. Some companies even have age minimums. Hertz, for instance, rents only to drivers aged 20 and older. Avis‘ minimum age is 21 (18 in New York and Michigan), but it adds a surcharge for drivers under 25.

Tips to pay less for a rental car

Here are a few tips to save money when renting a car.

Check in periodically and re-book your rental car if prices drop

As stated above, you can typically get a better rate if you book a rental car well in advance. However, rental car rates tend to fluctuate over time. Therefore one money-saving strategy is to book your car in advance with a reservation you can cancel without penalty. Then check back during the weeks and days leading up to your travel date and re-book if you see the rate drop. Just be sure to remember to cancel your original booking!

Use rental car loyalty programs

If you prefer to use a single rental car brand, consider enrolling in their loyalty program, if available. This can save you money if you rent frequently. Hertz Gold Plus Rewards, for example, allows you to earn free rental days and upgrades. Similarly, Avis’ Preferred program offers points you can accumulate toward free rentals.

Decline optional rental car insurance

The collision damage waiver (CDW) and other rental car insurance options can add up to $30 per day to your rental cost. However, you may be able to decline these options without adding to your financial risk if the car is damaged or stolen while in your possession. Your car insurance policy will most likely apply to a rental car.

Be sure to fill up the tank

Finally, when you’re at the rental counter and given a choice to pre-pay for gas or bring the car back with a full tank, choose the latter. When you pre-pay for gas, the rental company usually charges you for an entire tank — regardless of how much gas is left. So budget a little time in your return trip for a stop-off at a gas station near the airport, and only pay for the gas you actually use.

Rental car alternatives

Remember that your daily rental cost is only part of your total ground transportation cost. You’ll need to pay for gas, and possibly tolls and parking. Each of these can add significantly to your travel budget. If the costs keep adding up, consider these rental car alternatives.

Taxi or rideshare

You’ll find that taxis or providers such as Uber and Lyft service many major airports with competitive prices. A taxi from Hartsfield-Jackson Atlanta Airport to the city center is estimated to cost $30, while an Uber or Lyft ride is estimated to cost $15. However, make sure to do some research ahead of time, because some of the country’s busiest airports do not allow ridesharing services to pick up passengers.

Of course, you can also use these services to get around once you’ve settled in at your destination. Depending on how much you need to travel, relying on a taxi or rideshare service may save you money compared to renting a car.

Hotel shuttle

Check your hotel’s website to see if it offers a shuttle back and forth to the airport. Often these services are complimentary, though you may have to wait a few minutes in the airport’s arrivals area for the shuttle to arrive. Hotel shuttles may also operate only during daytime hours.

Public transportation

If traveling to a metropolitan area, consider using available public transportation. Public buses and trains often serve the airport. You may be able to get to a station or stop that’s just a short walk from your hotel. Yes, you’ll have to figure out the schedule and how and where to make connections, but you could save a lot of money on your ground transportation costs.

Frequently asked questions (FAQs)

Why are rental cars so expensive right now?

With both business and personal travel booming in the post-pandemic era, demand for rental cars is outpacing the supply. In recent years, this was exacerbated by automotive manufacturing supply chain delays, which has limited the number of cars rental companies could buy.

Do you need car rental insurance?

Car insurance is mandatory across the U.S., even when you drive a rental car. The good news is that your insurance policy may provide coverage for rentals. Contact your insurance company or your agent before you travel to confirm what coverage your policy provides.

When will rental car prices go back to normal?

Rental car costs have dropped slightly in 2023 compared to 2022. However, most industry experts predict that rental car rates will, unfortunately, remain high for the foreseeable future. It may be a while before we see rental car prices return to normal.