People renting cars for holiday trips may be in for some sticker shock.
Rental car companies have brought in more vehicles since shortages sent prices sky-high this summer, but rates are rising again as more people prepare to hit the road over Thanksgiving and the winter holidays.
"The holidays are looking better than this summer, but I wouldn't be celebrating too much. It's still a pricey time to rent a car, and we predict that it will be for quite some time moving forward," said Matt Clarke, vice president of North America marketing at travel search company Kayak.
Just how much rates are expected to go up depends on who you ask, and where you're renting.
Kayak estimates average rental prices in Chicago over Thanksgiving are about $104 per day, up 90% compared with the same period in 2019. Nationwide, rates averaged $97 per day, though New Yorkers are expected to pay even more: about $135 per day over Thanksgiving.
AAA forecasts a more modest increase, with an average daily car rental rate of $98 across 20 U.S. locations over Thanksgiving, up just 4% from last year but nearly 31% higher than 2019.
Drivers will also shell out more to fill the tank. Gasoline prices were 49.6% higher in October than they were a year ago, according to the most recent Consumer Price Index report from the U.S. Bureau of Labor Statistics.
More than 53.4 million are expected to travel for the Thanksgiving holiday, up 13% compared with last year and within 5% of 2019, AAA said. About 90% of those travelers are expected to drive.
Car rental prices shot up this summer as travel rebounded while rental companies were struggling to replace the hundreds of thousands of vehicles they sold when travel shut down early in the pandemic. Semiconductor shortages affecting car manufacturers limited access to new vehicles.
Avis Budget Group had about 434,400 vehicles in its fleet during the three months that ended Sept. 30, up 20% from the same period last year and similar to the average size of its fleet in 2019. The company spent about $8 billion on new cars this year, CEO Joseph Ferraro said during an earnings call earlier this month.
In an investor presentation, the company said it spent more than $8 billion on new vehicles this year and is working to extend the lift of cars in its fleet.
Hertz, meanwhile, still had 34% fewer vehicles in its fleet during the three months that ended Sept. 30 than it had two years prior.
"Although we are fleeting new vehicles each month, we are not seeing the levels of supply required to fully replenish and rotate the fleet," Chief Financial Officer Kenny Cheung said during an earnings call last month.
Hertz has ordered 100,000 Tesla electric vehicles, which are expected to be delivered through the end of 2022.
Kayak's Clarke advised shopping around, which could include checking out companies that let customers rent someone's personal car.
Car-sharing company Avail tripled its vehicle listings compared with a year ago as of September, spokesman William Miller said in an email.
Clarke also recommended booking as early as possible.
"We're not anticipating last-minute deals in this market," he said.