Summer is upon us and travel bans have lifted, which means that more Americans will need to rent cars. However, rental car rates may increase yet again and even worse, travelers may not even be able to rent a new car. As you can guess, the lack of inventory is to blame.
Rental car prices plummeted during the pandemic but increased in 2021 when the travel ban started to lighten up. During that time, the ongoing global shortage made it hard for rental car companies to remain stocked with cars, so they raised prices. Now, the rental fleets are still starved for new car inventory, so prices may go up again this summer.
According to The Drive, “manufacturers are still facing chip shortages and manufacturing delays, and in some cases aren’t able to get cars to paying customers, so they aren’t interested in low-profit rental fleet sales.” Before the pandemic, rental fleets made up for around 7-12% of the manufacturer’s total sales. But now, they account for around 4-7%, says Europecar, a French rental company. This means that rental companies are keeping their older inventory around and even purchasing used cars to pad their fleets.
While using slightly older cars in rental fleets might sound kind of weird to travelers, it makes sense to the rental companies. The Drive reports that rental companies are able to maintain higher profit margins using older cars and when it comes time to sell them, they’re able to sell them at a higher rate – thanks to the inflated car market. Also, the lack of new cars for rental companies to buy means that they can keep their fleets smaller and more manageable.
If you plan on renting a car this summer and want to save some money, then here are a few tips according to NerdWallet:
Another tip is that you can also book a rental car at the last minute to save some money. It may seem counterintuitive, but it works. If you plan on traveling this summer and need a rental car, then every dollar saved counts.
