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It might be hard to believe that a “cheap” vacation can exist anymore, given that prices for everything have increased. That’s especially true if you need a rental car for your trip.
When the pandemic shut down the world, the travel industry took a steep hit. Car rental companies in the US had lots of cars that no one was renting, so to stay solvent, they sold off their excess inventory. While that strategy helped them survive in the short term, it’s also driven increases in rental car prices for consumers.
When people felt comfortable traveling again, they went right back to renting cars, causing the industry to quickly rebound. After revenues fell 27.4% in 2020, the industry experienced record growth in 2021, according to Auto Rental News.
Unfortunately, the sharp increase in demand for left car rental companies in the lurch, as supply chain issues and semiconductor chip shortages made it difficult for them to replenish their inventors. Car rental companies’ ability to buy new cars is at its lowest rate in 20 years, per Auto Rental News.
While rental companies are adding more cars to their lots, it’s not at a pace to meet demand. This has sent car rental prices soaring, forcing consumers to budget a much larger portion of their travel expenses for car rentals.
Though the overall situation has improved since last summer, 93% of US travelers plan to take a vacation this year—according to a February 2022 report from The Wall Street Journal—so demand is still high. A nationwide shortage of rental cars still persists, which will…
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High demand and low supply have made renting a car more expensive than ever. CoPilot looked at Business Travel News’ Corporate Travel Index to find which cities had the most expensive car rentals.