As prices for airline tickets, hotel rates and package holidays continue to rise inexorably, there is a glimmer of good news for anyone who needs to rent a car this summer. After a rise in fares since the pandemic, the cost of renting a car at holiday airports has fallen dramatically.
New research published by Which? shows that prices have fallen by as much as 47 percent compared to last year. The data (provided by estate agent Zest Car Rental) includes the cost of 3,000 one-week rental properties in 13 popular holiday destinations, including Orlando, Malaga, Faro and Corfu, both this Easter and during the 2024 summer holidays.
At Easter, prices had fallen significantly at 11 of the 13 destinations compared to last year (see table below). The biggest falls were in Funchal, Madeira – £146 to £266, down 35 per cent – and Palma, Mallorca, where £92 (29 per cent) fell to £227. Only Rhodes (up 36 percent) and Nice, where prices almost doubled, saw an increase compared to last year. Which? believes that it may be a lack of local competition that causes this inequality.
The picture this summer (see table below) also looks rosy. There were price drops at nine of the same thirteen destinations. Rhodes is leading the way this time with a drop in average fares from £419 to £259, a 38 per cent drop that was in stark contrast to the Easter rises. Madeira, Alicante, Corfu and Palma de Mallorca are all more than £100 cheaper than last summer.
Nice was once again more expensive than in 2023. A nine percent increase will see average rates rise to £560 per week – much more expensive than any other destination. Overall, Larnaca in Cyprus saw by far the biggest increase, up 33 per cent to £252 per week.
Why then, with few exceptions, have prices started to fall even as inflation has remained persistently high? During the pandemic, car rental companies sold many of their vehicles due to collapsed demand. When travel suddenly recovered in 2022, they struggled to replenish fleets. As a result, prices rose enormously. Research by Telegraph Travel recorded increases of between 59 and 158 percent since summer 2019. The Which? The report did not cover rental costs in Britain, but a recent survey by icarhireinsurance.com found that prices here have also risen since the pandemic.
Last year the picture was more mixed: prices still rose in some destinations, but fell in others. But now it appears that rental car stocks are largely back to normal and increased competition is starting to take effect. Nevertheless, despite the latest falls, average prices have risen, according to Which? overall still significantly higher than in 2019: an increase of 51 percent at Easter and 53 percent in summer.
How to find a cheap car rental booking
The fact that the situation is returning to normal does not mean that you will no longer have to deal with high prices, especially during peak times. But there are things you can do to keep costs down. Here are our tips.
1. Compare prices
Rates for the same car can vary greatly depending on how you book. Real estate agents, who negotiate with local and international suppliers, are usually the best places to start when comparing prices. Zest (zestcarrental.com) and Auto Europe (autoeurope.co.uk) are two of the best. But always make sure you compare one against the other and include all the extras (see below).
2. Book early
Normally people book their rental car only a few weeks in advance. But if you’re planning a holiday during peak hours, the normal rule is that the earlier you book, the more likely you are to get a reasonable deal. Start planning your summer holidays now, for example.
3. Pay to secure the booking
If you make at least a deposit when booking, you guarantee that you will get the car at the agreed price. Sometimes – when demand is high – unscrupulous suppliers who knew they could sell cars at higher prices have been known to cancel bookings without a deposit so they can resell them at a higher profit.
4. Check the contract
Make sure you understand the deductibles for collision damage (CDW) and theft protection. Most now cost at least $1,000, so even if you’re told insurance is included, you’ll be liable for that amount if you damage the car. Therefore, take out additional coverage before picking up the car. Most car rental companies sell some sort of policy to refund or reduce the excess to zero, although independent insurers such as reducemyexcess.co.uk, Insurance4carhire.com or icarhireinsurance.com are usually cheaper.
Check that your credit card limit is high enough to leave enough deposit to cover the deductible. This is because if you don’t buy a policy from the supplier you pick up the car from, they will require proof that you can cover the required amount. It is essential that the card you present is in the name of the same person who originally booked the car.
If your flight is delayed more than one hour after the rental start time, please contact the rental office at the airport – otherwise your reservation may be canceled. Many suppliers have a policy of only holding cars for two hours after the agreed pick-up time unless notified.
Check that no unwanted extras have been added to the contract you are asked to sign.
Inspect the car to make sure any scratch or dent on the body is noted on the contract. Take photos of all four sides of the car – as well as the odometer on the dashboard.
Double check the fuel policy. The simplest is one where you get a full tank when you pick it up, provided you return it in the same condition. You may be concerned that the gas station closest to the airport will charge higher prices, which is often the case, but this will pale in comparison to what you will have to pay if you return the car without a full tank. Keep the receipt from the gas station where you refueled before returning the car.
If the vehicle is not immediately inspected upon return, take photos to document its condition.