Summer vacation means it's road-trip time! These days, with gas prices again on the rise, saving money at the pump is on every road-tripper's mind.
"Want to fill the car up for 10 cents cheaper than local pump price?" the rental sales agent asks as he points to a sign showing a nice, cheap per-gallon price. Sounds like a good deal, no? As with everything in the rental car industry, there's a catch. Here are six reasons to think twice about prepaying that tank:
1. You have to return the car completely empty.
When you prepay the gas, you're paying for the full tank. If you bring it back a quarter full or even 95% full, there's no refund for the gas you left them in the tank. If you don't use every last drop, you're paying for gas you didn't use. That's free money for them…and a higher average price per gallon for you.
2. You're trusting them on the tank size.
Tank sizes vary—sometimes even within a given make and model. When the delivery truck rolls in with a load of new cars, the fleet manager loads all the information about that car into the computer—often quickly, and sometimes making assumptions about the car's specifications. Plus, ever noticed a typo or misspelling on your rental paperwork or the vehicle's key tag? If they can accidentally label a silver car as "sliver," what's to say they didn't accidentally key in a 17.5-gallon tank when they really meant 15.7—and charging you for almost two extra gallons when you prepay?
3. The tax man wants his share.
As Ben Franklin once said about the car rental industry, nothing can be said to be certain except pushy sales and taxes. Most people don't realize that when they agree to extra options like an upgrade or insurance for $15 or $20 a day, they're often paying more than 30% on top of that in taxes. Our Fee Detective series has covered taxes all over the world, and one thing is clear: every state, county, city, and airport has staked their claim over rental car revenue. And gas is no exception. That 10-cent-per-gallon "cheaper than pump price" rate can get inflated by 50 cents per gallon or more—just from rental taxes. Suddenly, it doesn't look like such a good deal.
4. "Pump price" might be a lie.
That sign on the rental counter showing current local gas prices is—well, we don't like to make blanket accusations, but the rental industry isn't particularly known for its forthrightness and honesty. The price shown might be for the closest gas station to the airport (which rarely has a competitive price, for obvious reasons), or it might be for the highest gas price in the area. Or it might just be for a station that's convenient for the manager to drive by on her way to work and make a note of. It's rarely the cheapest gas available, especially if you have a warehouse club membership. Our suggestion: check GasBuddy.com (or their mobile apps for your smartphone) so you have a true comparison.
5. Gas might be cheaper where you're dropping off.
If you're doing a one-way rental, be sure to check gas prices (again, GasBuddy is a great source) in your drop-off area. This can be huge in some places—like a one-way from Los Angeles to Phoenix (currently a 55-cent-per-gallon difference) or a pick-up in Manhattan and a drop-off in Clifton, NJ (currently a 35-cent-per-gallon difference). Prepaid gas prices are based on wherever you pick up the car, so don't overpay if you're picking up in an expensive-gas locale. (Conversely, though, if you're picking up in Phoenix and returning in L.A., you might be able to work this to your advantage, but be sure to take all the other points here into consideration!)
6. Don't forget credit card rewards!
Some credit cards are giving a very generous bonus on fuel fill-ups these days. The Costco Visa issued by Citi gives a 4% rebate on gas purchases, and the Chase Freedom periodically gives a very nice 5% rebate at the pump. Many others give double or triple points when filling up. If you buy the gas from the rental company, you won't earn those bonus rewards. When each rewards point or each 1% of cashback equals two or three cents per gallon, every penny counts!
When it does make sense to prepay for gas
If you're the kind of person who regularly dashes for the airport at the very last minute, or you'll be rushing right from a meeting to your flight, then prepaying for gas is often a better deal than letting them fill the tank at their normal punitive rate (which can sometimes approach—or even exceed—$10 per gallon), even if you've only used three or four gallons.
The AutoSlash Verdict
There's a reason rental sales agents are so highly incentivized to sell you on the benefits of prepaying for gas. Convenience comes at a price, and unless you return the car literally on fumes, you're likely throwing a significant sum down the drain. Budget a few extra minutes to fill up your car, use GasBuddy to find the cheapest gas on your way back to the airport, and pocket those extra dollars.
Want to pocket even more money? Be sure to check out AutoSlash and let us help you find the best rental car rates—for free!