Why Are Rental Cars So Expensive in Some Destinations?

Where you rent a car really influences what you pay. A recent survey from CheapCarRental reports a spread from a low of $28 a day in Columbus, Ohio to an outrageous $95 a day in Anchorage.

Other high-cost cities in which to rent a car include Honolulu at $94 a day, Washington, D.C. at $81, Denver at $79, New York at $78, and Boston at $74. Other low-cost cities include Milwaukee at $29, Albuquerque at $30, Ft. Lauderdale at $31, Las Vegas at $32, Los Angeles at $35, and Phoenix, San Diego, and Salt Lake City at $34.

The data’s based on the average cost of the cheapest available rental, with airport pick-up and return, during the June-through-August period. You can take a look at the full report at CheapCarRental.

Given that the big rental companies all pay about the same prices for new cars, the large gap between the nation’s cheapest and highest daily rental rates isn’t easy to understand. Certainly, various tax rates make some difference, as do shipping costs to and from Alaska and Hawaii. But the obvious conclusion is that rental companies charge high rates where they can and low rates where competition forces them to.

If you’re going to vacation in Hawaii, you really can’t rent a car in Vegas and drive. So is there anything you can do? In places where rental rates are extremely high, you have to consider the trade-off between the flexibility of renting a car (so you can stay at an inexpensive suburban hotel) against the higher cost of staying in a more centrally located hotel where you may not need a car.

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