By now, it's clear the airline industry's nickel-and-diming is here to stay. In fact, confirmation came last month, when the DOT reported the nation's airlines generated $7.8 billion in "ancillary revenue" in 2009, up 42% from 2008; baggage fees alone totaled $2.7 billion. We all know the airlines aren't about to stem that revenue stream.But rather quietly, consumers are being squeezed by the car rental sector as well. Hertz recently reported domestic rental revenues rose 9.8%, and cited pricing and ancillary revenues as the first two contributors. Similarly, Avis recently reported domestic ancillary revenues grew 12% on a per-rental-day basis.
For travelers, determining that bottom-line rate keeps getting tougher. In fact, you may define that term "rate" differently than most rental companies do, since they exclude a bunch of charges you might deem necessary.
A la carte cars
On two separate occasions in recent years, this column addressed the exorbitant taxes and surcharges that local municipalities often levy on out-of-town renters: " Can Congress Protect You from Car-Rental Taxes?" in August 2007 and " What's a Rental Car's Bottom-Line Price?" in April 2005. So, for example, if you're renting in Florida, you can expect to see a "battery & tire surcharge" on your bill.
However, those columns addressed fees that were imposed by governments and airport authorities, not by the rental firms themselves. Unfortunately, the onus remains squarely on the customer to inquire about such charges and clarify the fine print before booking. The Federal Trade Commission, in conjunction with the American Society of Travel Agents, provides tips for renting a car, and suggests you ask about charges that could increase an advertised base rate. Car Rental Express, a booking site, bluntly warns: "Sometimes companies have hidden charges that can increase the base rate by a significant amount."
So to break this down, there are fees levied by authorities and fees levied by rental companies. In addition, some of the latter are mandatory and some optional. So if in doubt about what's extra—ask in advance. The Internet is filled with blog comments from renters who feel ripped off.
Familiar fees ...
What follows are some common rental fees, culled from the websites of the ten largest rental firms; such info is most often found in the FAQs section. Unfortunately, no one company ranks better than the others when it comes to tacking on fees.
• Fuel. Should you pump your own? If you can, yes. Most companies offer a prepaid tank at a lower cost than the local going rate, but won't provide a refund for unused gas, so this often ends up costing you more in the end. If you don't choose the prepaid option and return a car less than full, expect to pay a much higher per-gallon rate than if you pumped it yourself.
• Special equipment. Safety seats, GPSs, cellphones, ski racks, snow tires—all come with a price.
• Additional drivers. These run about $12 a day, and don't assume spouses are covered, because they may not be.
• Underage drivers. Fees vary by company and by state. In New York, National charges an additional $23.50 per day for those 21-24, and an additional $70 per day for those 18-20.
• Late returns. These can get pricey. As Advantage notes, "charges are usually assessed in one hour increments until the hourly rate exceeds the daily rate."
• Vehicle license fees. These are still mandatory in some states, averaging about 5%.
... and not so familiar fees
Here are some fees that may be new to you.
• Mileage caps. The days of unlimited mileage are over for quite a few renters. As Enterprise notes: "Mileage allowed can and will be different depending on what part of the country you want to pick up the vehicle, when you want to pick up the vehicle and what size vehicle you would like to rent." With some firms, it may also depend on whether the location is corporate-owned or franchised. If you plan a long trip, this can get costly, so ask in advance. For shorter rides, Thrifty claims you'll save $3 to $7 per day with a cap.
• Energy surcharges. Budget and Payless call it an ERF, Energy Recovery Fee. By any name, it's mandatory, not optional.
• Roadside assistance. Changing flat tires and replacing dead batteries is always free, right? Check again—not in all cases. Better coverage, such as Dollar's RoadSafe or National's Roadside Plus, may be an extra-cost option.
• Frequent traveler service charges. Want to earn "free" miles through the rental firm's participation in an airline loyalty program? Rates can run $4.50 per day.
• No show fees. These are relatively new for renters, and could cost you $50, plus taxes and surcharges.
• Early return. Yes — a fee for returning early, not late. Alamo adds $15 when the car comes back one day earlier and the total daily/weekly charge is less.
• Changes. You probably know about fees for returning to other locations, which can be exorbitant. But extending a rental can incur charges too; at Avis, it's $10 per day.
• Peak surcharges. Look for blackouts on special rates.
• Toll programs. Such options can be convenient, but beware of fees; Hertz, for example, will charge you $2.50 per day for PlatePlass, in addition to the toll charges.
The list keeps growing
Here's a grab bag of other surprise fees that may appear on your statement:
• Special cleaning charge if pets shed or make a mess.
• Penalties for crossing state lines in violation of restrictions.
• Additional liability insurance when traveling outside the U.S.
• "Premium location" fees.
Then there's the greatest rental revenue generator of them all: collision damage waiver. As I pointed out back in 2004, CDW may or may not make sense for you.
It's obvious some renters are confused by this plethora of fees. The Better Business Bureau of Metropolitan New York advises: "Read the contract before you sign it. Most firms have written their contracts in plain language for all to comprehend." However, news reports indicate many customers remain unaware of such policies as toll pass fees, though they're imbedded in the legalese.
Travelers, have you found new fees on your recent car rentals? Share your stories below.
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