Car hire double the price in some holiday hotspots after Covid

Hiring a car for an Easter getaway is 72% more expensive than it was before the pandemic, new research by Which? Travel has found.

The average cost of a week’s car rental in Cyprus was £117 in 2019. Holidaymakers will typically pay 112% more this Easter: a seven-day rental is now £248, according to data from broker Zest Car Rental.

When we compared the cost of hiring a car in nine popular destinations with pre-pandemic prices, we found rental rates have rocketed everywhere - and doubled in Portugal and Greece.

Where has car hire soared the most?

The US is the most expensive place to hire a car of all the destinations we checked. You’d have typically paid £298 for a week’s rental in the 2019 Easter holidays. This year, the average holidaymaker will shell out a whopping £537 per week - 80% more.

In Madeira, hiring a car for seven days will cost you 64% more than Easter 2019: £340, up from £207. Car hire is also more than £100 more expensive for a week in Portugal, the Balearic islands, Greece, Italy and Cyprus. 

Although rental rates have risen the least (25%) in France, it’s still one of the more expensive places to hire a car - with a week’s rental now costing £364, on average.

Easter rental prices compared

We also compared the average cost of hiring a car this year during February's half-term school holiday and the first week of August with 2019 prices. The average price of a seven-day rental was 69% more in February half-term and 71% more in August.

See all of our Which? recommended companies for car hire

Why have rental prices risen so much?

Last year the cost of car hire sky-rocketed due to a drastic shortage of vehicles. 

Rental companies sold off cars at the start of the pandemic in order to stay afloat and reduce overheads. When travel restrictions were lifted and demand returned, they struggled to fully replenish their fleets quickly. This is largely due to less car manufacturing during lockdowns, a global shortage of semiconductor chips - a vital electrical component - and now rising energy costs. 

When cars do become available to buy, they’re a lot more expensive. According to Zest, a hire company in Portugal was quoted £17,000 for a Fiat Panda this year - a model that previously cost £12,000. Rental companies are also having to pay increased staffing and insurance costs.

The supply of vehicles has improved since last spring, when hire cars were thin on the ground in the Algarve, Alicante, Malaga and Mallorca. The average price of a week’s rental on the Balearic islands shot up to £805 last February half-term, according to data from Zest. Since then rental prices have fallen in some destinations, but remain considerably higher than pre-pandemic.

Zest told us: ‘We don’t think the rental companies will run out of cars in peak periods, but demand/occupancy will be very high. Advanced bookings are up 132% compared to this point last year. Everything is pointing to prices either rising or being similar to what we saw in 2022.’

How to save on car hire

1. Book early

Get your car hire locked in when you book your holiday, especially if you’re travelling in the school holidays or to a high-demand destination such as Mallorca or the Algarve. Last year holidaymakers who booked their Easter rental less than a month before their holiday paid a lot more than early birds (see the table below).

Easter 2022 rental rates: early and late bookings compared

2. Pay in advance

When you book online, most rental companies give you a choice: pay now or later at location. Settling up when you book is usually £20 to £50 cheaper for a week’s rental. Paying upfront (or at least putting down a deposit) also stops unscrupulous companies cancelling your booking in order to jack up the price later on.

If you need an additional driver, factor it in when you select a rental company. You’ll always pay more if you don’t mention it until you get to the rental desk.

3. Don’t buy insurance at the rental desk

Insurance from car hire companies is overpriced and poor quality when compared with the policies offered by third parties. Our top-rated excess reimbursement insurance from ChewInsurance costs just £22.54 for a week’s hire in Spain. By contrast, Europcar’s own ‘protection package’ cost £205.28 for a June booking. 

Be aware that if you purchase standalone insurance, your hire company will insist that you leave a hefty (refundable) deposit, and you’ll have to pay an excess if you have an accident. But you can claim it back from your insurance later.

See our guide to finding car hire insurance

4. Ditch the extras

Car hire companies charge over the odds for extras such as satnavs. Instead, download a free app, such as Navmii, which can access maps offline without eating up your data.

Child car seats are also pricey and not always in a great condition. Some airlines allow you to take your own for free as extra luggage. Alternatively, you can sometimes rent child car seats at the airport for a fraction of the price.

5. Book with a recommended company

We've rated car hire firms, including AutoReisen, Alamo and Enterprise, to help you book with confidence. As well as an excellent customer score, all Which? Recommended Providers have transparent pricing and have taken appropriate steps to mitigate price hikes and the shortage of cars.

Find out the best and worst car hire companies

6. …or trusted broker

A good broker acts as a buffer between a customer and car hire firms, providing added assistance if things go wrong and resolving issues quickly. We also found that brokers, who negotiate rates with providers, can often save you money on car hire. 

Our car hire broker comparison rates six of the biggest.

Our research

Zest Car Rental shared the average daily rate across all car categories in February half-term, the Easter holidays and the first week of August in 2019, 2022 and 2023 in nine destinations: Spain, Balearics, Portugal, France, Italy, Greece, Cyprus, Madeira and the US. The average rates encompass over 5,000 rentals.