Rent or Bring Your Own Car: 5 Key Factors for a Road Trip

• According to AAA, an all-time high number of Americans plan to go on a road trip over the July Fourth holiday week.
• In some instances, opting to rent a car could prove to be a more economically prudent choice compared to utilizing your personal vehicle for a journey.
• Several factors should be taken into account: the condition of the vehicle, rental and insurance costs, fuel economy, depreciation, and specifics of the lease agreement.

The summer months are ideal for embarking on journeys by car.

As many as 70.9 million Americans represent a new record. expected to travel By vehicle during just the Independence Day week, according to AAA.

According to experts, renting a vehicle for a road trip could be more economically prudent for certain car owners instead of using their personal one.

"Several elements will play a significant role in determining this," stated Greg Brannon, who serves as the director of automotive engineering research at AAA.

Those factors include According to Toyota, factors such as your present car's fuel efficiency, the length of the trip, the duration of your absence, whether you lease or own the vehicle, and the size of your automobile are all considerations.

Below are several important factors to consider.

The car's specs

Choosing vehicle capacity is an easy decision when deciding whether to rent, according to Brian Moody, who serves as the executive editor of Autotrader, a website for car shoppers.

Moody explained, "The simplest way to put it is: 'My car can seat only five people, but we're nine heading out for this trip.'"

Motorists might also have to compare features like whether they require a vehicle with two-wheel drive or four-wheel drive, along with assessing the cargo capacity for their belongings and equipment.

Operating costs

Here is where the calculations become more complex. Various monetary expenses come into play, with some being quite apparent and others not as much.

Drivers should compare the overall rental expenses, including the daily rental fee and possible additional charges such as insurance, against those of. operating their own car.

Brannon stated that many individuals would be astonished by the actual expenses associated with owning and maintaining a vehicle.

Filling up costs, like gas or electric charging, represent a monetary factor for both those who rent cars and vehicle owners.

It may be possible to rent a more fuel-efficient vehicle and save money. For instance, renting a car that gets 40 miles per gallon versus a currently owned one that gets 20 mpg would, all else equal, cut fuel costs in half.

"If you have an old car that's fuel inefficient, it might make sense to rent something," Moody said.

Rental costs

The average rental cost $42 a day in the second quarter of 2024, with most travelers looking for four-day rentals, according to travel site Hopper.

The daily rate can be higher or lower based on factors like rental company, car type, and pickup and drop-off location.

The cost of rental car insurance might add $30 to $61 to the daily rate, depending on insurance type, according to Allianz Travel, citing MarketWatch data.

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Tenants looking for car insurance might not require purchasing extra protection from the rental agency.

Car owners might already be covered for rentals under their personal auto insurance plans, or they could have partial coverage from their credit card benefits, according to Brannon.

He advised, 'Contact your insurance agent and verify your coverage.' He added that ensuring you aren’t over-insuring the car could help you avoid wasting money unnecessarily.'

Depreciation and limits on miles for lease agreements

Moreover, individuals leasing a car must consider aspects such as mileage limits prior to embarking on an extended journey. For instance, standard leases imposes financial penalties Regarding motorists who clock over 12,000 miles annually on their vehicles, as reported by Kelley Blue Book.

KBB stated that going beyond the specified limit typically costs around 20 to 30 cents per mile. For instance, at 30 cents per extra mile, a driver would incur an additional charge of $300 for driving 1,000 miles past the allowed limit.

Additionally, you have to account for depreciation expenses.

Depreciation leads to a reduction in a car’s worth over time. As soon as the vehicle is driven out of the dealership, it can lose approximately 10% to 15% of its value, according to Brannon.

The largest cost associated with car ownership is depreciation, according to Brannon. This is precisely why it's important to consider for road trips, as he explains.

"As you accumulate more mileage on a vehicle, its value decreases," Brannon stated.

Each mile causes deterioration to the engine, tires, and various components as stated by Allianz.

All vehicles experience depreciation uniquely. According to Toyota, the typical car loses value at an approximate rate of 20 cents per mile driven.

For brief road trips covering around 1,000 to 1,500 miles annually, depreciation may not significantly impact costs compared to renting, according to Moody from Autotrader.

Generally, depreciation usually only becomes relevant for individuals who intend to resell or exchange their vehicle at some point down the line.

State of the vehicle

Unexpected maintenance can come with a hefty price tag: According to Brannon, referencing AAA statistics, the typical repair bill exceeds $500, not including the expenses for transporting your vehicle.

Moody stated that the likelihood of a malfunction is reduced with rental vehicles, typically being more recent models. He added that the typical age of an older vehicle on the streets is around 12 years.

Although a mechanical problem could cause inconvenience for anybody embarking on a road trip, renters wouldn’t bear financial responsibility (provided they aren’t responsible), according to Moody.

Brannon highlights several queries drivers ought to consider: Am I keeping my car well-maintained? Will it handle extended journeys on the highway? Do the tires remain in good condition? Is the vehicle free of mechanical issues? How many years has it been around? Which safety features come with this automobile?