Extra Fees on Car Rentals Can Add Up Quickly

Airline fees have generated a lot of flak in the media. They’re typically labeled as “hidden” fees, although they really aren’t. Nevertheless, you see increasing calls for additional regulation. But not so with other travel suppliers. Someone asks:

“Do any other travel suppliers pad base prices with extra fees as much as the airlines?”

Actually, yes. When it comes to “hidden” fees, nobody beats the car rental companies. And, unfortunately, no government agency sees fit to regulate their price advertising the way that the Department of Transportation does with airlines.

{{{SmarterBuddy|align=left}}}The typical car rental price breakdown often includes up to a half dozen—sometimes even a few more—separately listed fees. And these extras can easily more than double the quoted base rate. That’s a lot worse than the airline case. Moreover, with rental cars, virtually all of the most common extras are mandatory, not optional as are most airline fees.

Legitimate Add-on Fees

To be fair to the car rental companies, some of the fees they pile on your rental are imposed by state and local taxing authorities. In many parts of the U.S., those authorities have zeroed in on car renters as a happy hunting ground for fee revenues from people who don’t vote in local elections and have no say. Among them:

• State tax.
• Local tax.
• Fees to fund tourism promotion.
• Fees to help pay for airport rental car facilities.
• Fees to help support local projects that a typical renter would seldom use—a stadium or convention center, for example.

As with the federal air ticket tax and airport passenger facility fees, the rental companies are simply acting as collecting agencies for the governments.

Not-So-Legitimate Fees

Unfortunately, rental companies also add lots of extra fees that go into their own coffers—fees ostensibly designed to cover what really is part of the rental companies’ cost of doing business and should be therefore included in the base rate. Among them:

• Vehicle license fees
• Vehicle excise tax recovery.
• Fees to cover the costs of airport shuttles.
• Fees to cover the costs of airport facilities.
• Fees to cover highway stickers (prevalent in Europe).
• Energy surcharges.
• Booking fees.

Some extras are completely opaque and mysterious:

• “Customer facility charge.”
• “Transaction fee.”
• “Transportation fee.”

Your guess is as good as mine as to what these fees are supposed to cover—beyond going right to the rental company’s bottom line.

Options, Too

Rental companies can also outdo airlines on optional extras. We’ve frequently covered overpriced “insurance” and all its ramifications. Beyond that, you may have your choice of such extras as GPS service, satellite radio, ski equipment, infant seats, and such.

Prices on those extras are often high. Hertz, for example, charges $11 a day for an infant seat. You can buy an infant seat at Walmart starting at around $40, so if you rent for four days or more you’re better off buying a seat even if you leave it behind when you return home.

Other Traps

Rental car contracts are full of fine print that can cost you a bundle and maybe put you at a tremendous disadvantage. My friend Don recently returned from a driving trip to Spain, where he admits to running a red light inadvertently. A few days after he was back home in the North Carolina High Country, he got a notice from Avis Europe that the company was charging the cost of the ticket to his credit card—and adding a fat $50 fee to cover the “costs” of handing his personal information over to the police.

A few years ago, several rental companies used built-in GPS units to detect driving over the speed limit or outside the contract’s geographical limits and subsequently added both a violation fee (even though no ticket was issued) and a per-mile charge for the entire rental on what was supposedly an unlimited-mileage rental. Breaking the speed limit or going outside the area limits, claimed the companies, violated the contract and therefore negated any special rates. Some states subsequently outlawed this practice, but you might still encounter it in others.

Those rental contracts, in fact, contain all sorts of wording that commits you to agree to a bunch of provisions, most of which put you at a disadvantage. They may include legal forum clauses, such as a limitation on your right to court in favor of compulsory arbitration of disputes. My lawyer friends call such one-sided documents “contracts of adhesion,” contracts that you can’t avoid signing and can’t amend during a conventional purchase process. Such contracts may or may not be enforced by a court. But most of you probably wouldn’t run the risks and costs of court action just to protest a $50 fee, regardless of how unjustified and arbitrary.

You do have some options. In the Spanish red-light situation, Don asked for and received a chargeback on his credit card, but that’s not a sure thing. Don also thinks some of these charges amount to a class-action suit just waiting to be filed. But that’s not going to help you, either, until someone files it—or some authorities decide to do something.

Rate Displays

In general, online travel agencies such as Expedia, Orbitz, and Travelocity do a pretty good job in presenting car rental rates. Although you can’t escape the fees, you can at least escape the deception: Those agencies allow you to do a side-by-side rate comparison on an all-up basis, rather than by base rate. As far as I can tell, their systems are close to foolproof—although you may encounter a few minor fees that these agencies don’t include.

The rental companies’ own sites aren’t quite so good. The initial price sheet typically displays only the base rates, and you don’t see all the extras until subsequent screens. Still, as with the airlines, you do see them before you actually buy.

You shouldn’t have to wait for displays of extras that are really business costs and should be in the base rate. Sadly, no government agency seems interested correcting this, so you just have to live with it and remain alert.

Your Turn

Have you been surprised by the fees on your car rental? Tell us about it by adding a comment below!