Rental Car Sticker Shock

You've booked your reservation ahead of time so you know a shiny Chevrolet Cobalt is waiting for you at George Bush International Airport in Houston.  What you don't know is that the charge for that rental car is going to be 66.1 percent more than the daily base rate quoted to you when you booked the reservation.  How can this be? 

You've heard of the two inescapable factors of life -- death and taxes?  Well, the bigger fees aren't caused by death, but if you stay for a week or more those added costs are likely to make you want to kill somebody (and I know just how you feel).  Government fees and taxes are the problem we have in Houston...and in many other cities where local interests have decided one way to sock it to travelers is through rental car charges. The added taxes are imposed by local and state governments in order to fund local projects.

Travelocity has conducted a study of these taxes and fees, and it found the average taxes added to base rates for car rentals at major U.S. airports increased from 24.4 percent in 2003 to 25.8 percent in 2005. Texas leads the nation in terms of sticker shock, having four of the top 10 airports with the largest difference between base rate and total price. The average taxes at top Texas airports decreased somewhat from the 2003 findings, though the dip was minor -- from 51.7 percent to 47.1 percent. Houston's Bush Intercontinental continues to lead the nation overall in airport taxes, but the 2005 figure is lower than 2003, where taxes averaged 71.7 percent.

On the other side of the coin are California and New York, but not because their taxes are low.  Instead California and New York include such taxes in the quoted daily rates, so cities in those two states were prominent throughout the top 10 list of airports with the least sticker shock. At Orange County airport, add-ons equaled 7.7 percent, which was the lowest among the top 100 airports.
 
So is there a way to avoid the big taxes?  Travelocity suggests renting at neighborhood locations rather than at airports.  Its research findings showed taxes to be dramatically lower at neighborhood car rental locations than airports, averaging only 14.1 percent of the final cost. And the difference can be significant.  In Dallas/Fort Worth for instance, consumers can save 44.3 percent on taxes by renting at a neighborhood car rental location.  Houston, Kansas City, Cleveland, Dayton and Phoenix are other cities where a trip to a neighborhood rental location can result in substantial savings.

Neighborhood rental locations are the fastest-growing segment in the rental car industry leaving consumers with several more options to choose from when renting. In addition to the convenience of accessing a neighborhood location close to home or work, taxes at neighborhood locations were usually lower than or equal to airport locations nationwide. Honolulu is the only major city where neighborhood taxes are considerably higher -- 12.8 percent -- versus taxes at airport locations.

Driving Today Contributing Editor Tom Ripley has traveled the world reporting on the auto industry and the human condition.  He is presently based in Villeperce, France.