When Jeremy Epstein rented a Nissan Altima from Hertz in Albuquerque, N.M., recently, he couldn't believe the car rental fees. They made the extras the rest of the travel industry charges look like the work of amateurs.
They do. But not for much longer.
Epstein's base rate for a weekly rental came to $280. But then the rental company added daily and weekly surcharges, including "government supplements" of $25, a "concession fee recovery" of $34, a $3 "vehicle license fee," a $1 "energy surcharge," an $11 "facility charge," a $10 motor vehicle lease tax, and a $45 state sales tax.
Epstein, a research scientist from Fairfax, Va., was on the hook for $411.
"Imagine going to the grocery store and getting a receipt when you check out," he says. "In addition to the cost of the food, there's a fee for delivering your food to the store, the space for the cash register, and a fraction of the bill for keeping the refrigerators cold. This is what rental car companies are doing."
There's good news for travelers like Epstein. The industry is gradually changing. Hertz disclosed the fees at the time it quoted his initial price (although he didn't see it because someone else made the reservation for him). Regulators require only that rental companies show the full cost before buyers complete the reservation. As a service to customers, car rental companies break down the fees before the final purchase screen.
"This also helps provide transparency to our customers," says Hertz spokeswoman Lauren Luster.
Car rental companies are moving from a business model that too often relied on deception to one of full transparency. The progress is slow, but it's measurable. It could soon put car rental businesses in the position of setting an example for the rest of the travel industry.
The extra costs you see on your bill fall into two general categories: taxes, which are imposed by the city, county, or state; and fees added by the car rental company. Both are a predictable source of customer outrage. The fees make little sense to drivers; the taxes often seem arbitrary.
More than 40 states levied a charge on short-term rental cars, according to a 2015 survey by the National Conference of State Legislatures. Among states that tax car rentals, the rates were as much as Maryland's 11.5 percent.
But not all the fees are outside a rental company's control. Julie Codrington, a computer technician from Gibraltar, Mich., contacted me recently after being broadsided by fees for "counter processing recovery," "shuttle recovery," and "facility recovery" on her bill.
"I rented a car for $200 online," she says. "After all the additional fees and charges, I ended up paying $421."
Those are junk fees — the kind that industry experts agree should be folded into the price of your rental.
Car rental companies and online agencies that broker rentals have taken important steps toward fixing that issue. When I recently checked on a sample rental rate, Enterprise quoted an all-inclusive price upfront. Hertz offered two rates — a low base rate above a total rate that included taxes and required fees. Avis quoted a low base rate and revealed the total cost three screens into the reservation.
Online travel agencies' disclosures also varied. Expedia quoted a low base rate in bold and posted the total cost below it in regular type. Priceline quoted a low per-day base rate but waited until the second screen to reveal the full cost, which included taxes and fees.
When selling through online agencies, for example, car rental companies can't mislead customers because the sites compare rates on a matrix. "You can't fool the matrix," says Chris Brown, executive editor of Auto Rental News, a trade publication.
In other words, companies have to play by the online agency's rules, which force them to be upfront about total cost.
Shop around carefully before you book a car. Check the car rental site and an online travel agency. Call the company to find out whether there is a better rate. You can't negotiate taxes and junk fees off your bill, but you can ensure that the price you're quoted is the price you pay.