Pre-Paying For Rental Car Gas: Not Such A Great Deal, Actually

The next time you rent a vehicle, you might have an exciting new option: to pre-purchase a set of gas for your return, freeing you from both the high markup on gas near the airport and the even higher markup on gas that rental places normally charge when you don’t return the tank full. Charles counsels you to avoid this special deal, at least in New York State, since the taxes involved make this deal much, much less appealing.

He writes:

So this past weekend I rented a car from the Enterprise at [redacted] Airport, and I was given a new (to me) option at the rental counter when I went to pick up the car. I could “prepay” for gas to avoid having to return with a full tank, at the bargain price of $2.67/gallon. So, for example, if I prepay for 3/4 of a tank, I can show up with the tank 1/4 full. This seemed to be a decent option, since gas in the area is typically $.20 higher than $2.67, and often even further inflated at stations near the airport and rental agencies. It’s also well below the $4.50/gallon they charge if you don’t pre-pay and then show up without a full tank. I figured they made their money on people mis-estimating their usage, and returning with more gas in the tank then necessary.

When I returned the car, I had estimated perfectly, pulling up to the lot with exactly 1/4 tank, and feeling happy to have prepaid for gas at a bargain price. But when I looked at my receipt, I was dismayed to see that my “prepaid gas” was subject not only to the 14.28% “airport access” fee, which put it squarely back into the area average @ $3.05/gallon, but also to the seemingly ludicrously high rental car tax rate of 19.875%, which increased my “bargain” $2.67/ gallon gas to the exhorbitant rate of $3.66/gallon. Even though Enterprise didn’t pocket that last $.61/gallon, I still feel cheated. Don’t fall for this next time you rent at an airport.

Various governments pocketed that 61 cents. You have every right to feel cheated.

Comments

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  1. DanRydell says:

    “Various governments pocketed that 61 cents. You have every right to feel cheated.”

    This blog has a liberal slant, but apparently you’re anti-taxes? How is that going to work.

    • TouchMyMonkey says:

      Very easily. Gasoline shouldn’t be subject to the rental car tax or the airport access fee. Just the rental car.

      You see, we may be liberal, but we’re not a bunch of Kool-Aid drinkers.

      • DanRydell says:

        I’ll remember that next time someone is bitching about airline baggage fees, which the airlines use as an alternative to raising fares because the fares are taxed and the baggage fees are not.

    • Scuba Steve says:

      This blog has many different writers with many different “slants”. It seems to work fine.

      I’m not an expert on NY tax codes, so I couldn’t tell you if that Tax was just or unjust, but letting people know about an “easy to avoid” tax is very pro-consumerist.

      We don’t have a responsibility to pay the government anymore than we’re asked to.

      • DanRydell says:

        Letting people know is great – although pre-paying is not something new and has never really been a good idea because it’s difficult to predict how much gas you’ll have left when you return the car. Saying the customer was cheated is a bit over the top.

    • Loias supports harsher punishments against corporations says:

      In this case you’d be wrong. Because when you purchase gas you’re already paying taxes. Laura has no objection to taxes, but does object to double-tipping. The OP in this case paid taxes twice on his gasoline.

    • pdj79 says:

      You’re paying for gas…it’s already taxed and now they’re being double-taxed. That’s BS!

    • Jimmy37 says:

      That is so bogus. It’s a well-known fact that municipalities load the taxes on tourists, especially on rental cars and hotel rooms. These aren’t taxes. This is stealing from tourists. There is no way that paying 50% on a car rental is a reasonable tax. What services are these taxes paying for?

  2. TouchMyMonkey says:

    Nice catch. I had a deal like this in San Antonio last December – prepay for a full tank of gas and bring the car back empty. I didn’t check my receipt, but I’m wondering now if Texas does people the same way.

    • MrEvil says:

      I don’t think Texas does. However, I can’t speak to local laws which usually are the majority of the taxes at rental car places.

  3. Beeker26 says:

    Sigh… another day, another scam.

  4. Southern says:

    Prepaying for gas is nothing but a win-win for the rental company. Either you bring it back and it needs more gas than what you paid for (and believe me, they know the gas tank capacity of every single car they rent, and that “3/4″ of a tank on that Dodge Challenger is exactly “10.2 gallons” — and you pay for every 1/10th of a gallon over that), OR you bring it back with LESS gas than it needs, and they just pocket the difference.

    IE, if you prepay for a “full tank” of gas, and bring the car back with half a tank, they’re STILL going to charge you for a FULL tank.

    Nothing but a damn scam. I’ll fill up the car myself within a 2-3 mile radius, thanks.

    • rpm773 says:

      I’m not sure I understand. You bring it back full, and you don’t have a problem with getting charged the high rate for the rental company to fill it. Fill it up within a few miles of the drop off location, keep your receipt, and you’re all set. Never bring it back 3/4 full, because then you’ll get charged $6/gallon or something to fill it. But that rate is agreed upon when you sign the contract.

      And, yes, prepaying for the gas means you’re buying the whole tank. Not what you use. So if you know you’re not putting on enough miles to use up a tank, it makes no sense to prepay. But they usually leave that bit of deductive reasoning to the customer.

    • FerretGirl says:

      I usually prepay for gas because I’m a late person and I’m always running late to get to the airport in time. I’ve tried every which way to Sunday to try and become an early person or get there in time but it NEVER happens. Prepaying for the gas is an excellent convenience for me. Can’t tell you how many times I’ve been super stressed by remembering at the last minute that I’ve got to fill up the damn rental car tank.

    • trentblase says:

      That’s why I prepay for a whole tank and then siphon the rest out when I bring it back. The TSA usually gives me some shit though about my checked luggage, though.

  5. Verucalise (Est.February2008) says:

    Got to love New York.

  6. balthisar says:

    Since when is pre-paying a tank of gas “an exciting new option”? This has been offered for at least a decade (as far back as my rental memory goes), and probably longer.

    • cromartie says:

      Agreed. I’ve been renting cars for forever and this has always been an option, and usually a poorly priced one.

    • nbs2 says:

      I think the exciting option was pre-paying at below retail rates. Not that I’ve bothered looking at them in a long time, but last I remember they were charging the same or slightly more than retail.

    • Funklord says:

      The “new” option was pre-paying for a partial tank. Previously, pre-paying meant you paid for the full tank of gas, only useful if you brought the car in completely empty and bone dry. Here, you could pre-pay for 1/4 of a tank and bring it back 3/4 full, or pay for 1/2 or 3/4 as the person in question did.

  7. Tongsy says:

    Or you could just fill up at the gas station that is usually beside the rental car places

    • RandomHookup says:

      I have found that’s not always the case at some airports. You have to know that the exit before the airport is the place to get your gas.

    • rpm773 says:

      And usually that place has a pretty good mark-up, catering to all the renters that fill up there.

      After picking up your car, but before you leave the airport area, scope the area out a bit for a gas station to hit before you return it. Check the prices. Then when you fill up, keep your receipt so that you can prove where you filled it at and how much you put in.

    • Rachacha says:

      Also not good if you are arriving at the airport in the wee hours of the morning for an early morning flight and all the gas stations are closed.

      The only times that I prepay for gas is when I take those early morning flights, or when I know I am not going to have time to refil before returning the car like when I am catching a late afternoon flight (6:00), my meeting is scheduled to end at 4:30, and it is a 30 minute drive to the airport (doesn’t happen too often)

  8. Blueskylaw says:

    Thank you Kennedy/LaGuardia once again for a “happy” traveling experience.

  9. rpm773 says:

    Any extras you pay for (gas, GPS, baby seat, insurance, etc) are all subject to the 20%+ taxes and surcharges the cities put on. The last time I was on Phoenix, it was closer to 30%.

    It’s a victimless crime as far as the city is concerned – you’re taxing people from out of town, many of which are running on expense accounts. Of course, if you’re the sorry soul who has to rent a car at the airport on his own dime…

    • APFPilot says:

      Phoenix has the higest rental car taxes in the nation, they have to pay for that remote rental car facility some how…

  10. Etoiles says:

    Exactly once did I ever take the pre-pay option, and that’s because somehow it had worked out that the pre-pay was $2.35 per gallon and the price of gas at the time was more like $3.75 per gallon. And I knew I’d use just about 3/4 of a tank on that trip.

    Seemed like a rip-off pretty much every other time, though.

  11. Phil Villakeepinitrreal says:

    Honestly, I’ve never seen proof of this claim that the gas prices are jacked up near the airport. It simply doesn’t happen here, and I’ve seen no evidence of it in Minneapolis, Boston, San Diego, Atlanta, Skaneateles, Milwaukee, Chicago, or other places I’ve traveled with a rental car.

    • dilbert69 says:

      Are you kidding me? In San Diego, the Shell station at Pacific Highway and Laurel has the highest gas prices around. I always used to fill up at the ARCO at Rosecrans and Lytten instead, even though it’s farther away.

      • Phil Villakeepinitrreal says:

        No, not kidding at all. I used to live in San Diego and I’ve been back to visit my father with rental cars, flying in and out, about four times since 2005 or so. The gas has always been pretty much in line with what was expected from the rest of the city.

        Wasn’t bad in LA either, when I flew in there in 09.

    • A42NT1 says:

      The City of Orlando has a long-running dispute with the two gas stations closest to the airport for 1) not posting their prices, and 2) charging enormous $4-$5 rates per gallon.

    • Big Mama Pain says:

      There really aren’t any gas stations near Logan.

  12. scratchie says:

    The only thing “new” here is the fact that you can purchase a portion of a tank instead of the whole tank. Many car rental places have been offering the “buy the tank” option for at least a decade, and, as speculated, they make their money because nobody ever returns the tank bone dry, and most people return it with a non-trivial amount of gas in it.

    • squirrel says:

      At a business trip we once took where we were on-site for weeks at a time, we knew exactly how much gas it took to get back to the rental return at the airport. One car was returned that just started to idle poorly with a bone dry tank. I doubt it would have made it to the next corner.

      The rental company didn’t care. Ah, the good ol’ days of Hertz and their fleet of Ford Tauruses…

  13. AllanG54 says:

    I’ve never purchased a “set” of gas. How’s that done?

  14. redspeed says:

    The Enterprise at the MN airport tried pressuring me into prepaying for gas but its a waste of money. You will lose money on it whichever way you put it and to break even you would have to really calculate how much gas you have and how much would be left by the time you reach the airport. They even tried telling me I wont find gas within 5 square miles from the airport so Id better prepay for it. Funny thing was they were all over the place and there was one about a quarter mile from the airport we filled up at

  15. StevePierce says:

    If they are in the business of selling gas, do they have the proper weights and measures certificate required of all other fuel retailers?

  16. anewmachine615 says:

    This was not the case at the airport and rental company I worked at in another state. While the rental days themselves were subject to tax, absolutely nothing else was. But then I worked in a very low-tax state…

  17. guspaz says:

    Gas costs $5.60 to $6.00 USD per gallon in Montreal, and you people are whining about paying the “exhorbitant” price of $3.66 USD per gallon? Stop whining. $2.67 or $3.66, either way you’re paying dirty cheap prices.

  18. Purr says:

    To counter the negativity here, I have rented cars many times, and only used the “prepay” option once last month. I was quite pleased. As a bonus for prepaying, they upgraded my car to a nice SUV and gave us a free second-driver, which is normally a daily fee. Prepayment of the gas was rated on the tank size of the car, not the SUV, and it really was $.30-.50 less expensive than the listed price for any gas station in the area we were traveling. (CA and NV). This was with Alamo, and while there was a bit of a tax charge, I don’t consider it exorbitant. Overall, it was a good experience. I calculate pennies rapidly before making any “upgrade” or Point-of-sale decisions, and didn’t find us losing out.

    I think the OP has issues with taxes, period. I’m not sure this is the best forum to complain about taxation.

    • Big Mama Pain says:

      That’s weird; I’ve used Alamo (and Enterprise) and never had to pay for the additional drivers. You’re 100% responsible for the car no matter who is driving it, so adding the driver is really just for the purpose of protecting yourself if there was an accident, for insurance purposes.

  19. alally says:

    I encountered that ploy only a couple of weeks ago. The agent at the Alamo counter in Kauai Hawaii tried to get me to sign up for it. He said that the gas that the option would purchase would be at only $3.42 a gallon. He said that “gas was $3.49 in Lihue just this morning”. I declined, & found I could get gas for $3.35 in Kapa’a. He was going to charge me an additional $48, & before returning the car I gassed up for $35. Also, his pitch was that I would be able to use up all of the gas before returning the car, returning it as empty as possible to get my money’s worth. This seems to me very wasteful & anti-green. They should be encouraging fuel conservation, not driving around just to use up gas. Finally, although I can’t say whether it was my faulty understanding or his slick pitch, i thought at first that the option was only for topping off the tank, that is would pay for 1/4 tank if you returned it 3/4 full; instead it was to pre-pay for an entire tank.
    By the time he got to this I was resistant to his pitches anyway, as he tried mightily to get me to rent a Dodge Challenger, playing on me to impress my wife with a muscle car. As no speed limit on Kauai is over 50mph, I figured if i ever wanted to do that it would be in Las Vegas to drive to LA.

  20. Yentaleh says:

    I’ve brought along a small gas container that I pack in my luggage. (brand new of course) When I’m ready to head home I stop off at a gas station not close to the airport and I fill up the gas container and put it in the trunk. I then drive the car back to the airport and before I enter the garage I fill up the car with the gas container. (If you are wondering if I’ve ever had a spill or the car smells like gas, no. I’m thorough and careful. I use a funnel to funnel the gas into the container and then dispose of the funnel) It puzzles the rental companies how I always come into the garage with a full tank. I then leave them the gas container and tell them that they can keep it or throw it away. It maybe sneaky, but its legal and I’ve had no issues or problems with my method.

  21. alally says:

    I encountered this just last week. At the Alamo counter in Kauai, Hawaii, the agent tried to sell me on this, saying the option covered a tank of gas at $3.49 per gallon, and “gas in Lihue was $4.59 just this morning”. I declined & later found gas to be $3.35 in Kapa’a. The agent said to get your moneys worth you should return the car as empty as possible. This seems to me to be very wasteful & anti-green. They should be encouraging fuel conservation, not just driving around to use up gas. Also, I don’t know if it was my misunderstanding or the agent’s slick pitch, but I originally thought the option paid for the gas necessary to top the tank off, not for an entire tank. When I saw the charge for an additional $48 I told him I didn’t want it. I later topped the tank off for $30 at $3.35 a gal, & didn’t feel compelled to just use gas needlessly. (Sorry if this post is redundant; I thought i submitted one earlier but it never appeared)

  22. dmuth says:

    Interesting, I *just* rented a car from AVIS at Philly airport this past weekend and chose the “Fuel Service Option”, which is what the call it. According to the receipt, I was charged $37.46, or about $2.73 a gallon, and NO taxes were applied to it.

    There was an 11.11% airport fee charged, along with sales tax, and the receipt clearly showed that they were applied to the rental itself, and the charge for the fuel was added to that subtotal.

    I’m wondering if Enterprise might have pocketed that money, afterall.

  23. RogueWarrior65 says:

    I’m convinced that the rental car companies know precisely how much gas needs to be in the tank so the gauge appears to read full when in reality they screwed you out of a couple of gallons.

    • Fjord says:

      I once rented a car where I used a coupon that required me to have pre-paid tank of gas. I darn made sure the car was empty when I got back. The lot attendant was amazed how I brought the car back without running out of fuel. It was fun making circles around the airport.

  24. Boberto says:

    I travel. A lot. I am so fed up with car rental companies. It is clearly, the most predatorial segment of the travel industry.

    Cabs, buses, walking. Whatever it takes to not have to deal with them.
    Oh, and by the way-my company reimburses 100% of a car or sky other travel expense.