Rental Car Shortage Causing Price Spike Across U.S.

After a year of shedding unused vehicles, rental car companies have found themselves with a massive shortage in their fleets as we head into the spring and summer travel seasons. American travelers are once again looking to travel beyond their home states, and rental car prices have skyrocketed as demand far outstrips supply.

Experienced travelers and road trippers who have been used to paying much more for airline flights than rental cars may find themselves in a very different situation this year.

As rental car companies either went bankrupt, out of business or scrambled to unload their inventory to stay afloat, they’ve found themselves with insufficient inventory heading into this spring and summer as domestic travel rebounds. Why not just buy more cars? A global microchip shortage has closed some auto plants around the world, complicating the supply chain.

In many cases, when planning a summer trip in 2021, you may find your rental car expense running more than your airline tickets, even if you do plan several weeks ahead. The shortage is especially dire in popular vacation destinations. Some markets are so strapped for inventory that rates are astronomical. In Maui, rental cars are currently going for near $1,000/week, and were reportedly going as high as $500/day a few weeks ago. Last spring, at the onset of the pandemic, Hawaiian travel sat at a near standstill, and those same cars reportedly rented for as little as $5/day thanks to nonexistent demand.

“Rental car supply is normally tight around spring break, but not like this,” Chris Woronka, analyst at Deutsche Bank, told CNN in March. “Normally you have 30% more cars.”

While you may think the rental car companies would have time to adjust, they’re also being careful not to overshoot demand in case the pandemic situation changes again. Some analysts and industry insiders don’t expect the situation to stabilize until 2022.

“The problem seems to be getting worse, not better,” AutoSlash founder Jonathan Weinberg told USA Today this week.

What can you do to avoid getting dinged at the rental car counter this summer? First off, plan ahead. It may also be helpful to be flexible with your travel dates, look for weekly rates, and check prices around town, not just the airport.

You also may want to consider if you really need a rental car at all. In walking cities like Boston, New York or Las Vegas, dealing with a rental car may be more hassle than it’s worth, given high prices, traffic congestion and parking logistics.