Car rental demand is up, supply is down resulting in high rates in Colorado
DENVER (KDVR) — Waiting to book that summer vacation? Travel experts say if you’re thinking about renting a car, you better book now before it’s too late.
Rental car prices have tripled in many leisure cities across the United States, including Denver. In some top spots, it’ll cost you 10 times what it normally would.
“We initially saw the problem on President’s Day weekend, and we saw that 18 out of the 20 airports in Florida were completely sold out. Typically rates would be about $35-$40 a day, we were seeing rates of $150-$200 a day,” said Jonathan Weinberg, CEO and Founder of rental car website autoslash.com.
Those sky-high prices come down to one thing: more customers than cars.
“So rewind back to March 2020, the rental car companies saw demand drop 90%, and they basically shifted into survival mode. They had to sell off as many vehicles as they could just as fast as they could, just to stay solvent,” Weinberg said.
Major rental companies, according to Weinberg, weren’t prepared for this spike in demand.
“As demand came pouring back in February as people started to get vaccinated, the rental car companies found themselves with a huge shortage of cars,” Weinberg said.
He attributes the shortage of cars to a one-two punch. First, the shut down of auto manufacturer plants during the pandemic, and second, the semiconductor shortage.
“Cars these days are basically computers on four wheels. The computer chips control all the major functions of these vehicles, and without them, you simply can’t get these cars off the production line,” Weinberg said.
He gives these tips to consumers. Firstly, book early.
“By booking a ‘Pay Later’ rate, something that you don’t have to give your credit card for, that will give you flexibility so if a better deal comes along or your plans change, you can just cancel and rebook,” Weinberg said.
He predicts this problem will last at least through the end of summer. So, bottom line: booking last minute is not going to work this year.
Weinberg says be warned if you’re traveling Memorial Day Weekend, as several US cities are showing scarce if any rental car availability.
In the popular tourist destination of Hawaii, rental car prices have gotten so high that U-Haul is now reporting passengers are renting moving vehicles now to get around the island.
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