Why rental cars are still in short supply

cost explosion
High prices: why rental cars are still in short supply

4/24/2022, 4:06 p.m

2 min reading time

With the onslaught during the Easter holidays, the parking lots of the car rental companies have been swept empty. Vacationers have to reckon with doubled rental prices. The situation will worsen in the high season, not only in Mallorca.

If you rent a finca for your holiday in Mallorca, you cannot do without a set of wheels to get to the often remote accommodation. Until now, renting a car at the airport in Palma was not only a matter of course, but also inexpensive. A small car was already available for a daily price that corresponded to a taxi ride from the airport to S’Arenal of around 20 euros.

Until two years ago, the budget planned for a rental car was not a big item in the holiday budget. But during the pandemic, the fleet size at the rental stations has often been reduced by half. As a result, fewer vehicles are now available. Demand has been booming since Easter, while supply remains scarce. After the entry restrictions in such popular holiday countries as Spain, Italy and Greece were lifted, Germans are increasingly flying south again, to the beaches around the Mediterranean.

During the Easter holidays there were almost no free vehicles in Mallorca. “There was an unexpectedly high demand not only from tourists from abroad, but also from visitors to the island from mainland Spain, reports the regional newspaper Última Hora.

Reduced number of new cars

“Rental operators have no opportunity to build up the usual large fleet at the moment. They are therefore currently making a significantly smaller range of rental cars available,” says Kai Sannwald, Managing Director of Sunny Cars. “That automatically drives the price development.”

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According to the two car rental associations Aevab and Balebal in Mallorca, there are currently 50,000 fewer vehicles available than in the year before the pandemic. That led to price increases of up to 300 percent. The average price per day is now around 130 euros.

Due to delivery difficulties for individual components such as chips and wiring harnesses, the car industry has not been able to ramp up production for months and supply car rental companies with the new vehicles they want. The vehicle manufacturers are also concentrating on selling premium models with higher profit margins directly to end customers – the rental companies on the holiday islands, on the other hand, tend to need smaller vehicles.

The pandemic has also shaken the car rental companies’ business model, which has been tried and tested for decades: they purchased large numbers of heavily discounted vehicles, which they were able to sell profitably at the end of the season as young used vehicles.

The price increases vary depending on the destination and week: less in Scandinavia, more in Croatia and Spain, especially over Pentecost. In addition to Mallorca, the lack of small vehicles in Portugal is particularly acute. Here in the corresponding segment even 70 percent are missing, says Sannwald, who cannot give the all-clear: “Unfortunately, there is no relaxation in sight on the market,” is his conclusion, and he gives the tip: book early, not only on site.

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Have you come across huge price increases when booking a rental car over Easter or for the planned summer holiday? In which destination? Tell us about your experiences and write to: Reise(at)stern.de

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