Car rental prices increase 75% before Thanksgiving

Thanksgiving travelers can expect to pay up to 75% more for car rentals this week amid nationwide vehicle shortages, sky-high gas prices and chain issues supply.

The average cost per day of a rental car is about 66% higher than last year and 75% higher than prices in 2019, ABC News reported, citing estimates from travel booking site Kayak.

Jonathan Weinberg, founder and CEO of Autoslash.com, said consumers spend up to $ 300 a day to rent a car in high-traffic places such as New York and the nationwide average price is d ‘about $ 100 a day, more than 50% more than it was in 2019.

“Things are pretty crazy right now and the reason is that we have a huge shortage of rental cars, there is a shortage of semiconductors, basically computer chips are not available and with modern cars from today, they require more than 100 chips in each. ”Weinberg told the Post on Tuesday.

“I think there was a lot of trepidation in traveling last year and the car rental companies still had enough inventory to meet that demand and now it’s completely reversed,” Weinberg said.

Prices rose 66% more than last year.
PA

“They just sold too many cars in the middle of 2020 when COVID was impacting their business and they thought they were going to buy those cars back when they needed them, but it turns out things weren’t that simple than they thought, “he said. added.

In Great Neck, Long Island on Tuesday, Ed L., 29, couldn’t believe the cost he had to pay in an Enterprise Rent-A-Car for wheels to take him to the east coast of Maryland for spend Thanksgiving with his family.

“This is the highest amount I have ever paid! Ed cursed as he showed his receipt to the Post.

“I did the same trip two years ago, it was $ 27 a day. I just got fucked hard for $ 307.57 for two days ?! For a small car. An average size ?!

“I’m in shock. I came today to pick it up and beat the rush but had to cut a day off and will start tomorrow morning. Last time I did this, gasoline and the tolls were more expensive than the rental. I hope that is not true this time!

The problem is compounded by the number of travelers who will be on the road before the Thanksgiving holiday. AAA projections show that up to 90% of travelers choose to drive instead of flying, up from around 80-85% in previous years, which only increases the price with increased demand.

Rental car
AAA estimates that nearly 90 percent of travelers choose to drive instead of flying for the Thanksgiving vacation.
Matthew McDermott

Ivan Drury, senior director of Insight at Edmunds, said the auto industry has been in chaos since the COVID-19 pandemic and it’s causing stickers to shock at the car rental counter.

“It really comes down to the fact that last year, during the fire of the pandemic, the rental companies weren’t moving units, nobody was moving cars, they were keeping these depreciating assets… they decided that they were just going to have to sell these things, ”he said.

Around the same time, automakers were forced to shut down factories and production came to a halt. They cut off the semiconductor chip drives needed to power everything from heated seats to navigation systems, but when the economy rebounded faster than expected, they were unable to source the crucial parts. Drury explained.

The Covid-19 pandemic has plunged the auto industry into disarray.
The COVID-19 pandemic has thrown the auto industry into disarray.
REUTERS

“Right now, new car dealers only have about 20% of the inventory they’re used to in a typical year, we’ve even seen rental companies [who] want to buy x number of units, they can’t even have them delivered, some car rental companies even use used cars.

Drury said he expects it to take around a year to a year and a half for prices to stabilize.

Additional reporting by Kevin Sheehan


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Sylvia F. Hernandez