How to save on car rental costs for your next trip abroad

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The cheapest way to rent a car is by planning ahead of your travel.
The cheapest way to rent a car is by planning ahead of your travel.

Yes, we know everyone is getting fed up with all the bad news about how prices for everything are spiralling. The holiday season is here, and so are the dreams to book that bucket list trip we have been dreaming of forever. Before you book your next holiday, you should know that car hire costs are going through the roof. In this post, I’ll share tips on saving on rental cars and avoiding the worst.

How to keep car hire costs under control on your next trip abroad
How to keep car hire costs under control on your next trip abroad

Analysis suggests that car hire rates in many popular European destinations have at least doubled in the past 12 months. This happened because many car hire firms sold off vehicles during the COVID-19 pandemic to keep their overheads down while business flatlined. As the covid situation has come under control and people started travelling again, the need for car rentals has increased. Unfortunately, the number of cars available for rental is still low – there is more demand and less supply, which is why car hire has become so expensive. Add the soaring petrol prices on top of that.

Of course, with the cost of living pressures putting the squeeze on people in so many other areas, the last thing you want is anything that will push up the cost of your next holiday.

In an ideal world, you would say avoid hiring a car. But that only works for some. You may have a young family and want the convenience of getting around quickly and independently. You may be heading somewhere remote where public transport options aren’t great, or you may be on a road trip with your family or friends. In that case, car rental is the only option left.

Whatever your reasons for wanting to hire a car, it makes sense to start planning how to keep costs down now. Here are some tips on how to save on rental cars.

Book early and pay in advance for your rental car

The days of rocking up at a car hire desk straight off the plane are over. Well, at least if you want to avoid paying well over the odds, they are. Whether it is Hertz, Enterprise, Avis or any other budget car rental firm, know that anyone walking up to a desk looking to hire a car is a captive audience. You need a car; they have all the power. Don’t expect any deal.

How to save on car rentals: Book early and pay in advance for your rental car
How to save on rental cars: Book early and pay in advance for your rental car.

If you want to find the best deals on car hire these days, you can’t afford to leave booking online for a few days or even a couple of weeks before you depart. The competitive early bird markets are being pushed further and further back. So as soon as you confirm your trip, get online and start looking for car hire deals.

Although it flies in the face of most money-saving advice, it’s also a good idea to pay for your car hire in advance in the current climate. That’s because there have been stories of hire firms cancelling pay-on-arrival agreements. After all, they know they can get a better price last minute. Look for deals that ask for at least a deposit to be paid to lock in the price.

Beware of cancellation charges by car hire firms.

If you do pay in advance or provide bank card details to secure a booking, be wary of cancellation charges. Some car hire firms will have punitive penalties hidden deep in the contract’s small print for any cancellation, whatever the reason – even if you have to cancel through no fault of your own because your flight gets cancelled or one of your party comes down with COVID.

Tips to save money on car rentals: Beware of cancellation charges by car hire firms.
Tips to save money on rental cars: Beware of cancellation charges by car hire firms.

These charges can also rear their ugly head if you arrive late because your flight has been delayed. Again, check the small print – some contracts specify that you must collect the car within two hours of the agreed time. Otherwise, the hiring firm reserves the right to terminate the agreement.

One way you can protect yourself against these charges (other than picking a deal where you are sure they don’t apply) is by taking out travel insurance. The cancellation cover included in travel insurance policies will pay out for all proven losses arising from a flight or holiday being cancelled, not just flight and accommodation costs.

Buy your excess waiver.

Speaking of insurance, one of the ways travellers can be stung by car hire is the rigmarole surrounding drivers insurance. In many countries, car hire firms are obliged by law to include insurance as part of the deal. But you often find that the insurance offered includes massive waivers, meaning any accident you are involved in will automatically cost you hundreds of pounds, even if you make a successful claim.

To get around this, you can take out separate excess waiver insurance – or insurance to cover the hire insurance excess! It’s worth having to be on the safe side, but don’t buy from the car hire firms – they charge way over the odds at rip-off rates. Once you have booked your car hire, get back online and look for excess waiver insurance. You will get a much better deal.

I hope you’ll find these tips useful for saving on rental cars. If you have any good or bad car hire experience or tips you would like to share on what to consider when hiring a car, please share your feedback in the comment box below.

1 Comment

  • Ryan Biddulph says:

    Booking and paying early makes sense, Archana. Also, doing in-depth homework on the process for the country. Renting a car in Panama proved to be quite odd compared to other countries because one pays little day-to-day but a hefty premium on insurance for the month in addition to a heavy extra insurance payment made upfront. Definitely not regular, but we figured it out and secured a good deal.


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