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Summer is the season for road trips.
A record 70.9 million Americans expected travel According to AAA, driving is only allowed during the July Fourth holiday week.
For some car owners, renting a car for a road trip may be more cost-effective than using their own vehicle, experts say.
“It’s going to depend a lot on a number of factors,” said Greg Brannon, AAA automotive engineering research director.
those factors include Toyota says your current vehicle’s gas mileage, how far you’ll be driving, how long you’ll be driving, whether you lease or own, how big your vehicle is, and more.
Here are some key considerations.
car specifications
Brian Moody, executive editor of car shopping site Autotrader, said vehicle capacity is a “no-brainer” when choosing whether to lease.
The simplest way to put it is, “I have a car that seats five passengers, and I have eight passengers traveling,” Moody said.
Drivers may also want to compare specifications, such as the necessity of a two-wheel drive vehicle versus a four-wheel drive vehicle, as well as storage space for luggage and gear.
operating costs
This is where the math gets a little tricky. There are many financial costs, some obvious and some not so obvious.
Drivers need to compare the total rental cost (daily rental and potential add-ons such as insurance) with operate their own car.
“Most people would be shocked by the actual cost of owning and operating a car,” Brannon said.
The cost of fuel, such as gasoline or charging, is a financial consideration for renters and car owners.
Maybe lease a more fuel-efficient vehicle and save money. For example, leasing a car that gets 40 miles per gallon can cut your fuel costs in half compared to the car you currently own that gets 20 miles per gallon, all else being equal.
“If you have an older car that’s fuel inefficient, it might make sense to lease something,” Moody said.
rental costs
average rent Costs $42 per day According to travel website Hopper, by the second quarter of 2024, most travelers will be seeking four-day rentals.
Daily rates may be higher or lower depending on factors such as the rental company, car type, and pick-up and drop-off location.
Allianz Travel, citing MarketWatch data, said rental car insurance can cost $30 to $61 more than the daily rate, depending on the type of policy.
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Renters who want car insurance may not need to purchase additional coverage through the rental company.
Owners may already have full rental coverage through their auto insurance policy, Brannon said, or they may have partial coverage through credit card benefits.
“Call your insurance agent and double-check your coverage,” he said. “You can save a lot of money by not double-insuring your vehicle if you don’t need to.”
Lease Depreciation and Mileage Caps
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In addition, owners of leased vehicles should weigh factors such as mileage caps before taking a long trip. For example, a typical lease impose financial penalties According to Kelley Blue Book, drivers who drive their vehicles more than 12,000 miles per year.
KBB said the cost of exceeding that cap is typically around 20 to 30 cents per mile. (At 30 cents, drivers will pay $300 for every 1,000 miles they exceed the mileage limit.)
There are also depreciation costs to consider.
Depreciation causes a car to lose value over time. Brannon said it’s common knowledge that cars lose about 10 to 15 percent of their value once they’re driven off a lot.
Depreciation is “the largest expense of owning a vehicle,” Brannon said. That’s why it’s important for road trips, he said.
“The more miles a vehicle puts on it, the more it depreciates,” Brannon said.
Allianz says every mile takes a toll on engines, tires and other moving parts.
Depreciation affects all cars differently. According to Toyota, the average car depreciates about 20 cents per mile.
For shorter road trips (for example, 1,000 to 1,500 miles in a year), depreciation may not be as big an issue relative to the lease price, Autotrader’s Moody said.
Depreciation usually only makes sense to people who plan to sell or trade the vehicle in the future.
vehicle status
Unforeseen repairs can be expensive: The average repair order on the road is “well over $500,” not including towing costs, Brannon said, citing AAA data.
Moody’s says rental cars are less likely to break down because they are typically newer models. He explained that the average age of a used car on the road is about 12 years.
Moody’s says that while mechanical issues can cause inconvenience to road trips, renters will not be financially responsible (assuming they are not at fault).
Brannon points out some questions drivers should ask: Is my car well maintained? Are you going to be on the road for a long time? Are the tires in good condition? Mechanically sound? How old? What safety technology does the car have?
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