Find a cheaper car rental rate away from the airport

By | January 24th, 2010

The best rate Darren Popik could find on a weekend car rental at Austin-Bergstrom International Airport recently was $114. So he decided to look elsewhere.

Popik, a Los Angeles-based blogger, widened his search to other car rental locations in the Texas capital. And he found a lower price through Enterprise Rent-a-Car. “It was a much better deal,” he said.

No kidding. At $38 — just one-third the airport rate — it was a steal.

At a time when rental rates are climbing, Popik is one of many travelers who have discovered that it pays to cast a wide net when you’re looking for affordable wheels.

Why such a dramatic price difference between on-airport and off-airport locations? Local taxes and airport concession fees, according to Robert Barton, president of the American Car Rental Association. The fees cover the companies’ costs of renting airport facilities and of shuttle services to and from the terminal for customers, but the taxes can fund local projects that may or may not have anything to do with airport users.

“It’s taxation without representation,” he said.

Take Barton’s recent two-day rental at Phoenix Sky Harbor International Airport, for which he paid $27. After a 5 percent vehicle license fee, a 10 percent concession fee, a $12 airport fee and a 77 cent-per-day “tourism” fee were extracted from the price, only about half of the rate went to his car rental company.

Neil Abrams, a car rental analyst with the Purchase, N.Y.-based Abrams Consulting Group, says that the rate difference between an airport and off-airport location has historically been “substantial.” For example, the average weekly rate on a compact car — the kind many leisure travelers prefer — was $363 at an airport, according to a survey his company recently conducted. By comparison, the same rental taken off-airport cost just $202.

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“The rate difference is pretty constant,” he says. But as car rental rates rise, more travelers begin looking for other ways to get around.

The extra airport fees and taxes, he adds, put airport-based car rental franchises “at a competitive disadvantage.” That’s bad news for the car rental company, but good news for you.

Except when it isn’t.

In some cities, renting at an airport makes sense almost every time. Denver comes to mind. When Amy Pollick hired a car in the Mile-High City recently, in-town rentals were “unbelievably cheaper,” she said.

“Trouble is, my only friend in Denver wasn’t in town to meet us at the airport and take us to the office,” recalled Pollick, who works for a newspaper in Decatur, Ala. “Cab fare to and from the airport would have completely wiped out any savings we realized.”

Sometimes, it isn’t the distance to the airport so much as it is the duration of the rental that matters. Jeff Tucker, a technology consultant who lives in Hawaii, frequently rents cars in Seattle.

“You can rent cars in nearby Kent and save a bundle on taxes,” he said. “Unfortunately, they couldn’t shuttle you to and from the airport, so you had to take a cab.” For a short-term rental, it’s not worth it. “But if you’re staying for several days, that often pays off,” he added.

The other issue is convenience. Rent a car that’s miles away from the airport, and you could save a lot of money. But if your flight leaves around rush hour and you don’t give yourself enough time to return the vehicle, you might also miss your plane. That’s happened to me a time or two.

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We shouldn’t have to be making these calculations, of course. We should be able to rent from the airport at a fair price when we’re flying into town. I can’t think of any other business that routinely doubles its rates between stores without breaking the law.

Any other business would be prosecuted for price gouging. There’s just one thing: Car rental companies aren’t doing this. The taxes and fees are for the most part being added by airports and municipalities, which makes these higher prices perfectly legal.

I think most travelers expect gas to cost a little more in certain neighborhoods and a little less in others. They anticipate price fluctuations on restaurant meals, groceries and other items they might buy while they’re on the road. But the exorbitant airport markup on rental cars defies reason and takes advantage of the people who are bringing tourism dollars to a destination: you.

Unfortunately, there’s little travelers can do to help narrow this unacceptable price difference. Until motorists refuse to rent their cars at the airport, which is unlikely, airports and counties will continue overtaxing their passengers, to the detriment of car rental companies, and us.

(Photo: DanieVDM/Flickr Creative Commons)

  •  This is my personal  Experience Personally, I think its all a sham. Half the fees on the rental are
    ridiculous. I saw one agency charging a “licensing fee”. Assuming this
    is the cost to put a license plate on the car, isn’t that a cost of
    doing business? 

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