Car rental - Out of Arizona for five bucks a day

This is a predictable seasonal subject for my blog:  super low one-way rates in the spring out of Arizona, and the reverse later in the year back to Arizona.

Hertz has bargain rates of $5 per day for economy or compact cars driven one way from anywhere in Arizona to any Hertz location in California (or Utah, Colorado, New Mexico, Texas, Oklahoma, or Kansas).

For just a little more per day, you can rent an intermediate, standard, or full-size car, or a mid-size SUV.  Keep in mind that the only additional mandatory cost is tax; there isn't any one-way drop-off fee.  And if you rent from a non-airport location in Arizona, you will avoid airport concession fees.

Pick up the vehicle any day starting on 4 April but no later than 30 June.  You may rent the car for up to 14 days.

Here are three examples.  Prices include tax.

15 April to 19 April - Phoenix airport to San Francisco airport
economy car: $60.54, mid-size SUV: $139.96

21 May to 23 May - Tucson off-airport location to LAX
economy car: $16.58, mid-size SUV: $50.79

11 June - 20 June - Flagstaff Amtrak station to Chico
economy car: $57.44, mid-size SUV: $203.70

For complete details see this page on the Hertz website.

Avis has a similar but not as low-priced offer, and other rental companies may as well.

Car rental - Should you buy the insurance?

(Image: Ambro)

If you've ever rented a car then you probably have experienced a pitch by the rental car company's customer service agent to buy the optional insurance coverage they sell, in particular the LDW (loss and damage waiver) or the CDW (collision damage waiver).

For frequent business travelers the pitch is more muted or avoided altogether for renters who belong to programs like Hertz # 1 Gold, and have already indicated their insurance preferences in a customer profile, and can pick up the car directly and bypass the counter.  For less frequent renters, however, the sell-job can range from concise and polite to lengthy and fear mongering.  (Or sometimes concise and fear mongering to lengthy and polite...)

The good part about these waivers is that subject to the limitations of the vehicle you rent, you can return the car with damage and not be subject to the costs of repairs should something happen.  (No, it doesn't cover you if you trash the inside of the car, or if you use a vehicle for a dump run, etc.)  An additional benefit of LDW/CDW is that even if you have outside coverage (personal auto insurance, credit card, travel insurance), the paperwork following a mishap will be relatively swift because the matter is only between you and the rental company.

The bad part is that LDW or CDW coverage is expensive.

A friend and client of mine recently rented a car in Phoenix for 5 days during the spring training period.  When he picked up the car, the agent asked him if he wanted "full coverage".  He answered "yes" (doesn't everyone want full coverage?) but neglected to ask what that would cost.  When he returned the vehicle the total fee for the rental plus insurance coverages was $700.  Lesson learned for him.  ("Full" coverage probably included additional liability coverage and coverage for loss or damage to the contents of the vehicle, in addition to the LDW/CDW.)

Whether or not the car rental company's appeal to you to buy the insurance is pleasant or annoying, you owe it to yourself to come equipped beforehand with the knowledge to decide if you should or should not take out the coverage.  This way you can make an informed and confident decision, not a hasty one under pressure.

When I'm asked by clients as to whether they should buy the insurance I am careful to never give a definitive answer for the simple reason that I am not their insurance agent.  However I suggest they consider what follows below.


First check with your insurance agent

You can also read your policy - it may state it clearly there - but if isn't clear then you should contact your agent to find out exactly what your personal auto insurance covers when you rent a car.  If you rent cars outside of the U.S. and Canada then you need to get details for the coverage you receive - if any - overseas.

If your coverage does extend to rented vehicles, but has high deductibles for damage and/or you do not carry collision insurance at all because your car, like mine, is too old to merit it, then know that you may be exposed.

One other thing to consider If you rent cars fairly often, is to ask your agent if the insurance carrier offers an add-on to your policy to cover rental cars, and which goes beyond the coverage you carry for your own vehicles.


Coverage by your credit card

Some cards have coverage for rental cars, but as a rule it is secondary coverage.  What that means, is that it kicks in when your own insurance does not cover all or part of damage to a rental car.  As with your personal insurance, it pays to know what it will and will not cover.

For example, here is a link to the VISA Signature page that details the benefit of that credit card's program.  This is just the current (August 2011) program of coverage offered by one type of VISA card.  You need to determine whether your credit card provides protection, and if so, exactly what it covers.

The VISA Signature rules are pretty straightforward and common sense, but bear reading.  For example, the benefit only applies for standard vehicles: rare, super-expensive, or vehicles that carry more than eight people are not covered.  Rentals in Israel, Jamaica, or Ireland (both "Republic of" and "Northern") are not coverered.  Also the coverage is only for the vehicle.  It does not cover injuries to the car's occupants or others.

It might seem obvious, but in order to receive the benefit you must use the credit card as the method of payment for the car rental.


Travel insurance

Car rental coverage is either included or can be added as a supplement to travel insurance policies, but usually it is secondary coverage, as with credit card coverage.

One exception to that currently of which I am aware is Access America.  They offer $35,000 colision damage/loss for $9 per day, and it is primary insurance, which means that it would pay first.  You can buy this coverage on a stand-alone basis, or as part of a wider travel insurance policy.

Bear in mind that Access America (or any other travel insurance) is going to have its own exclusions and limitations (for example, they also do not cover rentals in Israel, Jamaica, or Ireland) so read the fine print carefully before buying the policy to be sure that it will apply to the specifics of your use of a rental car.


When should you buy the car rental company's coverage?

Only you can decide this, but I'll give you one example from my experiece where I think it is sensible.

Every year I run the Reno-Tahoe Odyssey, a 178-mile 12-person relay in the Reno-Tahoe area.  My half of the team uses a local teammate's minivan, so rental coverage there is not an issue, but the other half of our team rents a large SUV from Hertz.  Even though the two people that share driving responsibilities have their own insurance and credit card coverage, the six people in the vehicle share the extra cost of LDW (Loss Damage Waiver).

Why?  By doing so it means that if anything happens to the vehicle while they are using it, one person isn't stuck dealing with the bureaucratic aftermath involving the car rental company and other entities.  The couple of bucks extra that each one of the six people in the SUV pays is money well spent.


In conclusion

No one can tell you whether you should or should not take out the car rental company's LDW or CDW policies.  You need to make that decision.  But being well-informed of the coverage you may (or may not) already have, will help you make a good decision when you are at the rental car counter about to pick up your vehicle.

Car rental - Near the airport can beat at the airport

What is the price of convenience?

For many travelers it is priceless; they’ll pick the swiftest and least complicated way regardless of cost to get from point A to B.  Or more to the point of this post, from their arrival airport to their car rental.

For others it may depend on how great the price difference is, before they will consider picking up a car rental from an off-airport location that requires more effort to reach.

Lately I’ve been checking both airport and near-airport locations, either when a client asks me to or when I think it may produce significant savings with minimal disruption.

The price difference can range from nothing at all (or even more expensive from a non-airport location) to a modest difference to a huge difference.

Before giving some examples I’ll explain why the cost differences exist.

The reason is simple: it costs more for the car rental companies to do business at the airport because airports often impose taxes, user fees, or concession fees that the rental companies have to pass on to customers.

For many travelers – especially business travelers – the price difference is not enough to deter them from renting at the airport.  For business travelers time really is money, and the money that might be saved by renting off-airport isn’t worth it if it reduces the amount of work time available.

Leisure travelers have different agendas, and if time isn’t particularly precious then it may be worthwhile to compare the cost.  There is the potential to save money, which you could  better apply to the trip’s lodging and meals.

Here are examples, some of which are derived from my clients’ experiences.  Because I overwhelmingly book Hertz, I am using only Hertz examples but you will likely encounter similarities with other rental companies.  Off-airport locations cannot offer shuttle service to and from the airport, so customers must allow for the additional cost of a taxi.

San Francisco, compact car, 22-29 July, AAA discount:
Airport - $587.67
South San Francisco (about 3 miles from airport) - $212.30

Eugene, Ore., full size car, 10-17 August, AAA discount:
Airport - $336.69
Downtown Eugene (about 9 miles from airport) - $229.70 (see note below)

San Francisco, economy car, 12-13 July, AAA discount, one-way rental to Chico:
Airport - $183.05
South San Francisco (about 3 miles from airport) - $91.12

Chicago O’Hare, intermediate car, 3-10 August, AAA discount
Airport - $425.20
Des Plaines (about 3 miles from airport) - $251.04 (see note below)

Even though you pick up a car at an off-airport location, you may be able to return it to the airport at little or no additional cost.  In the Eugene example,  the price would be the same if booked with a return to the airport.  In the Chicago O’Hare example the price would only increase ten bucks to $261.12, almost certainly less than the cost of a taxi from Des Plaines to O’Hare.  The only way to know this is to try pricing it with the different options.  Obviously if you can get back to the airport using the rental car, it will save money (no need for a taxi ride back to the airport) and increase convenience.

Renting from an off-airport location will not always result in savings or in savings enough to justify some additional trouble and transportation cost to pick up the car.  I tested other cities and found no savings or actually higher prices for off-airport rentals.  Surprisingly in Las Vegas, a city where historically the price for an off-airport rental has been less expensive than an airport rental, I found the opposite to be true.  But nothing is constant in the travel industry which means that you need to do the research if you want to know for certain.  Because something is a particular way today means nothing tomorrow, a month from now, or a year from now.

In general I think you’ll find that when there is a savings it will more likely be for a rental of greater length – a week or longer.  Weekend rentals from airports can often be remarkably low even with the mandatory fees included.  Furthermore, if you’re traveling over a weekend, even a long weekend, you may not be interested in the extra time necessary to pick up and drop off a car at a remote location.

Interestingly, when researching rates a few months ago for a client booking a car in France I came across a similar situation but one that involved train stations.  I found a substantial savings was achieved for picking up a car from the Hertz location in downtown Aix-en-Provence compared with picking the car up at the Hertz facility at the TGV station a little outside of town.

As with airports in the U.S., the French railroad system imposes additional fees for doing business at the train station.  And as in the example for Eugene, Ore., the car picked up in the center of Aix-en-Provence could be returned to the TGV station for the same price.

To sum up: if you are surprised in a bad way by the cost of an airport car rental, consider investigating what the cost would be for renting from a nearby location.  You might be surprised, but in a good way.

Car rental - Outta Arizona for $5 a day

In my business, I also confirm car rentals for clients in addition to their hotel reservations.  Because I mostly book Hertz, I try to keep an eye on their special deals.

I ran across a seasonal doozie that could make for an interesting trip.

Arizona is a popular winter destination so it's logical that by the end of the season Hertz would have more cars on hand than they would need for the low demand summer.

What is the answer to their problem?  Offer ludicrously low rates for customers who drive the vehicles one-way out-of-state.

The result for you is rates as low as $5 per day if you take your rental car somewhere and almost anywhere outside of the state.

You can return the car to Hertz locations - both at airports and elsewhere - in California, Oregon, Washington, Nevada, Utah, Colorado, New Mexico, Oklahoma, and Texas.  And you can keep the car for up to 14 days, and still only pay the $5 (or higher) rate per day plus tax.  The last day you can pick up the car and enjoy this price is 31 May 2011.

You may pick up the cars at any Hertz location in Arizona.  Not just the Phoenix airport, but Tucson, Flagstaff, Yuma, or any of what are called "Hertz Local Edition" locations in downtowns, hotels, and suburbs.

OK, you don't live in Arizona, so how could this work for you?

Be imaginative.  Here are two examples.  (Read my Airline Fare School chapter about "Open Jaws and Tinkertoys" if mixing modes of travel is not something you're comfortable with.)

Example 1.  You live in San Francisco.  Fly to Phoenix, pick up the car, drive to Las Vegas, then go through Death Valley to Bishop in the Owens Valley.  Then head north to Lake Tahoe, then head home and drop off the car at the Mason Street Hertz location in San Francisco.  5 days economy or compact car rental: $75.92 with tax.  (If you picked up the car at an off-airport location in Phoenix it could be as low as $35, or even lower with AAA or other discounts.)

Example two.  You live in Chicago.  You fly to Flagstaff.  A day after you arrive you pick up a compact car at the Amtrak station and then make a ten day trip through California and Oregon and return the car at the Portland airport.  The 10 day car rental comes to a whopping $63.70 with tax.  (Prices for the same rental for an intermediate size car would be $213.60, standard size car $226.12, full size $238.61.  In certain locations some convertibles and SUVs can also be rented under this deal.)

Read the deal's fine print here.  A very similar offer is available for one-way rentals out of Florida.