Why You Should Never Prepay for Gas in a Rental Car

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Do you have to pay for gas when renting a car?

Yes, rental car companies require you to pay for the gas you use when renting a car. The only question is how you are going to pay for it including: prepay, pay the rental car company to fill it up for your or fill it up yourself.

When you rent a car you are expected to bring it back with a full tank of gas (or at least whatever it had in it when you rented it which is almost always “full”). In other words, you are required to pay for the fuel you use on top of the rental fees for the vehicle itself.

However, in what I can only imagine is some scheme cooked up by some rental executive on a golf course, rental car companies offer a few different options in how to deal with this.

  • Bring it back full
  • Bring it back with whatever gas is in the tank when it’s time to return the car
  • Prepay your fuel

Let’s examine these in more detail.

You could bring your rental car back with a full tank of gas

One option is to simply bring your car back with a full tank of gas. Meaning, on your back to the airport you need to stop somewhere (relatively close to the airport) and fill your rental car’s gas tank up. This is the method we recommend, by the way.

You could do nothing and simply bring the car back with however much gas it has in the tank

Another option is to simply do doing nothing and bring the car back in as-is. Instead of stopping to refuel your car you simply return the car with whatever fuel is in the tank at the time and walk away. This is a very convenient approach because it requires you to essentially do nothing. No trying to find a gas station near the airport (and airports can have some sketchy neighborhoods) or hoping the airport itself has a gas station.

This method, however, is probably the WORST thing you could do with a rental car when it comes to fuel. Why, you ask? Here’s the sneaky bit. The rental car company will then charge you to fill it back up – at a significant premium (we have seen it as high as $14.00 a gallon before) – usually somewhere’s around $9.00/gal-ish. Clearly this is the least economical method to use as you could get hosed big-time.

That said, it is the most convenient method.

You could prepay your fuel when you rent the car

The final option, and the focus of this article, is to prepay your fuel when you are renting the car.

For a “discount” off the current average fuel rate in that area, you can buy a full-tank of gas ahead of time and then simply return the car as is.

Sounds like a good deal? A discount? Sweet. WRONG. It’s a scam, really.

But wait…what if you don’t actually use all of the gas in your car? You see, when you pre-pay for gas you are paying for a FULL tank of gas – regardless of whether you actually need a full-tank of gas.

So unless you bring the car back completely empty it’s likely not going to make much sense. Many times travelers may only use a quarter of a tank or a half a tank. If that’s the case and you’ve prepaid for your rental car’s fuel you just walked right into the rental car companies scam.

You didn’t think the rental car companies would offer this service if they couldn’t make money, did you!?! Of course not. They are playing the arbitrage game that most customers will not use all of their gas and thus they will make money on that free gas money you gave them with no cost behind it.

Keep in mind that many rental car clerks may actually be incentivized to push this product to car renters so be on your guard and don’t get duped.

Video

Do rental cars have a full tank of gas

Answered By: Devin Moore Date: created: Oct 17 2020

For convenience, you may purchase a full tank of fuel from Hertz at the time of rental, at a price that is competitive with local fuel stations.

Asked By: Edward Miller Date: created: Feb 14 2022

Which is cheaper PrePay power or Pinergy

Answered By: Carlos Garcia Date: created: Aug 25 2021

Prepay Power charge a €338 service/standing charge annually – but have a slightly lower unit rate than Pinergy (19.86c) . Using the average 4200 kwh in a year with PrePay Power would cost €1261.

Asked By: Nathaniel Phillips Date: created: Apr 02 2021

The Findings:

After crunching all the numbers, here’s what I found.

1 Gas Prices Near the Airport are 15% More

The price at the gas station nearest to the rental car facility was $2.77 vs $2.46 at most of the surrounding gas stations that were still only a mile away. So they charged about 15% more for the convenience of filling up right before you return the car. And since most people, including myself simply head to the airport and then look for a gas station on the way, this

In this scenario, filling up a 15 gallon Toyota Camry near the airport would only be about $5 more than the market price a little farther away. So it’s not really that big a deal here.

But there are some gas stations that take advantage of this and charge up to double the actual price of gas.

So if you are refueling the car yourself, doing a quick search on Google maps for gas stations near the airport, you can make sure you’re heading to a station with reasonable prices. And since you’re probably already using GPS in phone to get back to the airport, you might as well let it take you to reasonable gas station first.

2 PrePay Gas Prices Often Don't Include Taxes

2 PrePay Gas Prices Often Don’t Include Taxes

One of the big selling points they try to make for pre-paying for gas is that you’ll pay less than at the pump, but what they are not telling you is just how much you’ll be paying in taxes and fees.

When you buy gas at the pump, taxes are included. So the price listed at the pump is the total price you’ll pay. The taxes on gas with rental cars are much more tricky. Every single agent I talked to was confused as to exactly what taxes would be charged on their gas prices. Sometimes they said taxes are included even though the signs clearly stated that there are additional taxes and fees.

And these taxes and fees can easily eat up any potential savings from the prepay prices. If the prepay prices to be $2.32 per gallon, but when you add 8.25% sales tax on that, it’s really $2.51 which is more than the local market rate of $2.45.

And if they don’t charge taxes, some companies add a flat refueling fee which can also override any potential savings.

3 Pre-Pay Prices Per Gallon are NOT always Cheaper

3 Pre-Pay Prices Per Gallon are NOT always Cheaper than Pump Rates

National and Alamo had the cheapest listed price at $2.32 which is less than the market rate at $2.45 and than airport gas station at $2.77.

But Hertz and Thrifty both charged $2.70 per gallon, which is MORE than the market rate of $2.45 and only slightly less than the market rate at $2.77.

And as we looked at earlier, these prices don’t always include taxes.

Don’t just assume that the pre-pay prices are cheaper than at the pump, most of the time they’re not.

4 Coasting on Fumes: Return it Less 1/16th Full to

4 Coasting on Fumes: Return it Less 1/16th Full to Save anything

The biggest oversight with prepaying for gas is that you buy the entire tank of gas ahead of time even if you don’t use it. So if you pay the $40 for the gas but return it half full, you’ve just thrown away $20. And that’s where they get you. You are betting that you’ll use all the gas you pay for but that’s rarely the case.

So how much of the gas do you have to use to actually realize the savings? This is the what I call the break even point. And after running the numbers, it’s a bad deal.

In order to save anything you have to return the car with LESS THAN 1/16th of a tank left!

That’s virtually empty!

What are the chances that you’ll just happen to time your mileage just right so you pull into the rental car facility and run out of gas?

It reminds me of the Seinfeld Episode where Kramer test drives a car that Jerry’s thinking of buying and tries to see how far it will go before if runs out of gas.

It's hilarious in the show, but that's exactly wha

It’s hilarious in the show, but that’s exactly what we’re doing when we prepay for gas.

And the car rental companies are betting that you return the car with gas left in tank. And if you prepay, you are essentially giving them free gas.

[clickToTweet tweet=”It’s virtually impossible to save money prepaying for rental car gas since you have to coast in on fumes to get the savings. Never Prepay! Here’s the full rundown…” quote=”It’s virtually impossible to save money prepaying for rental car gas since you have to coast in on fumes to get the savings. Never Prepay!”]

5 The Theoretical Savings are Exaggerated

So why do we even consider prepaying? On the surface it looks like we’re going to save money, but how much exactly?

When I ran the numbers, even in the best case scenario, if you prepay, return completely empty and all the stars align, How much can actually save?

$3.73

That’s it… wow so much for huge savings.

That’s the potential upside if you return it empty, but anything over 1/16th of a tank and you’re paying them. So remember that next time they ask you the prepay question, do you really want to risk that just to save $4, when most likely I’ll be losing that anyway?

6 Price Gouging isn’t Universal: Rent with Enterprise or National

One of the best things I learned while approaching each car rental counter was not only that they all charged different amounts for prepaid, but more importantly they also charged drastically different prices to refuel the car for you.

Most of the car rental companies charge an outlandish $9.99 per gallon to refuel the car for you!!! Filling up that 15 gallon Toyota Camry can cost $150 vs the $23 at the pump. That’s $127 you just threw away.

Rental car companies that do this  should be embarrassed for this practice, it’s obvious price gouging. But they should be even more embarrassed because not all rental car companies feel the need to screw their customers.

While price shopping I found that while everybody else charges $10 a gallon, Enterprise and National both charge a much more reasonable price of $3.50 per gallon. And Alamo was close behind at $4.50. Sure it’s a bit more than the price at the pump but they are filling it up for you. So on a 15 gallon car, that’s only about $15 more than what you’d already pay. And if that meant the difference of me catching my flight or not, I’d sure pay that.

I just assumed that every car company charged the same amount, but there is a huge difference. Such a big difference in fact that I’d say it’s worth ditching your old rental car company for Enterprise, National or Alamo. Whether or not you decide to prepay for gas, I’d much rather rent with a company that won’t screw me on the refueling charge if I don’t have time to refuel the car before returning it.

Are there any reasons to prepay for gas  ever?

Are there any reasons to prepay for gas ever?

In our opinion there are really no good reasons to prepay for gas. That said, one possible scenario is that you know will be pressed for time when returning the rental. Maybe it’s a work trip and you know that your meeting ends with a tight window to get back to airport. So you decide to prepay. The convenience of having the rental car company take care of this for you could be the difference between making your flight or not.

I would still argue that you should plan better.

Another scenario is that some airports (like Boston Logan and other big cities) can be challenging to find a gas station near the airport. This is stretching things a bit, though.

Our advice is once again to plan better. Or consider an Uber or Lyft or even a taxi.

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