For some kinds of travel, it might be cheaper to rent acar than to drive the one you already own.
Most of us don’t think about the cost of driving our car, other than the price of gasoline. Each year the federal government estimates the cost of driving a mile, which is 54 cents for 2016 — down from 57.5 cents in 2015. So if you decide to drive from Lumberton to Cross Creek Mall to do a little shopping, you better be getting some good sales: The 68-mile roundtrip costs $37 if you have an “average” car.
That’s just one more reason to shop near home.
The most expensive part of driving a mile is the wear and tear on the vehicle itself. You can substitute the numbers that make the most sense in your situation, but let’s do a little math.
Assume you buy a car for $20,000 and it has a productive life of 100,000 miles. For each of those 100,000 miles you drive, it will cost 20 cents per mile just to purchase the car.
The American Automobile Association website offers some other average expenses for a sedan driven 15,000 miles each year. It costs about 6.5 cents per mile for insurance; 5 cents for maintenance; 6 cents for finance charges; 6 cents for license, registration and taxes; 11 cents for gas; and a penny for tires.
Which of those expenses do you still incur when driving a rental car? Only the insurance, tax, finance charge and fuel.
You still need to make your car payment, of course, but presumably by not putting miles on your car you are extending its life. Using these numbers, you avoid spending 26 cents for each mile you drive in a rental car rather than your own car.
In short, any time the rental car charge is less than 26 cents per mile, you save money by driving the rental car.
My friends and students know that I love Enterprise Rental Car. Most of the year, the company offers a $9.99 per day special on weekends, which amounts to about $34 with taxes for three days. For the money, you get a small car, not a sedan, and you are limited to 300 miles. Most auto insurance policies cover you when driving a rental car, so make sure you don’t pay for rental insurance. If you drive 280 miles that weekend, it will cost about 12 cents per mile — far cheaper than the marginal 26 cents it would cost to drive a mile in your own car.
For longer trips, rental cars will typically be cheaper when you are driving many miles in a short span of time. Rental companies may tack on additional charges for driving through more than a couple of states and for having more than a married couple behind the wheel. Using travel websites such as Travelocity or Priceline often eliminates additional charges and provides a lower daily or weekly rate.
I value rental cars for some additional intangible features that are difficult to quantify. I’m not a “car guy,” but I do enjoy the novelty of driving a variety of vehicles. I also appreciate driving low-mileage vehicles, although rental companies have started keeping cars longer. Still, the rental car almost always has lower mileage and better tire tread than my own car.
I really appreciate a couple of features that come into play only rarely, but greatly reduce risk. My own car broke down at my daughter’s college graduation in Raleigh. That was a major hassle having to get a carload of people back home to Lumberton and dealing with a car in the shop 100 miles away. If that had been a rental car, an Enterprise driver would have brought a replacement car to me.
I’ve also been involved in two fender-benders in rental cars. It took some time and paperwork, but it didn’t end up costing me a dime. My own insurance policy covers me, but I have a $1,000 deductible, which was higher than the cost of both repairs.
Luckily, I had paid for the rental with a credit card that also provides rental car insurance. The credit card company paid for both repairs.
Rental car companies buy brand new cars, which means some renter has to be the first driver. I’ve been that person four times over the past 25 years, and gained some extra satisfaction from that new car experience.
Eric Dent is a business professor at Fayetteville State University who lives in Lumberton.