Why are car rental rates up 9% from a year ago?
Car rental: +9.1% in the 12 months to September 2026 (U.S. Consumer Price Index), versus +3.7% for prices overall. 1-month +0.1%, 3-month −2.0%, 5-year −12.9%.
Inflation check: Rising faster than inflation. +9.1% in a year, versus +3.7% for prices overall (2.4× the overall rate).
The short answer
- Car and truck rental prices sit 12.9% below their five-year peak because automotive assembly rebounded from pandemic-era shortages, but prices rose 9.1% over the past 12 months as rental companies restricted fleet growth to recover from heavy vehicle depreciation losses. [1] [2]
- Unadjusted rental rates exhibit extreme annual volatility, surging between 20% and 26% each spring and summer before plunging by 20% to 21% each winter as leisure travel demand fluctuates. [3] [4]
What's driving the price
Political, regulatory and trade factors
- Federal government travel disruption (Jul 2025 to Jan 2026), U.S. Federal Government: A federal government shutdown reduced public-sector and corporate travel, causing an 11% drop in Avis November rental days and putting downward pressure on off-peak rental rates. [pushed prices down] [8]
Macro factors: supply, weather, disease, energy
- Automotive supply normalization (Sep 2021 to Sep 2026): Automakers resolved the semiconductor and assembly shortages that crippled new vehicle deliveries in 2021, enabling rental operators to restock fleets and deflating the historic price spike that left five-year prices down 12.9%. [pushed prices down] [1] [4]
- Inflation in fleet insurance and repairs (Sep 2025 to Sep 2026): Rental companies faced rising operational overhead, including an industry-wide 17.8% increase in vehicle insurance costs and a 6.1% increase in maintenance and repair expenses, which drove price increases well above the 3.7% overall inflation rate. [pushed prices up] [9]
Retail, brand and seasonal factors
- Summer leisure travel demand surges (Jan 2024 to Jul 2024, Feb 2025 to Jul 2025, Jan 2026 to Jul 2026): Seasonal increases in consumer vacation and airport travel consistently overwhelm available fleet capacity, driving unadjusted rental rate jumps of 20.4%, 26.1%, and 22.2% during peak summer periods. [pushed prices up] [3] [4] [5]
- Off-peak autumn and winter demand lulls (Sep 2023 to Jan 2024, Jul 2024 to Feb 2025, Jul 2025 to Jan 2026): Rapid drops in post-summer travel compel major rental operators to slash unadjusted rates by 12.9%, 20.2%, and 21.4% to maintain fleet turnover during colder off-season months. [pushed prices down] [3] [4]
- Operator fleet discipline and capacity cuts (Feb 2025 to Sep 2026): After suffering steep financial losses in 2024 and 2025 from rapid electric vehicle depreciation, Hertz and Avis Budget Group downsized fleets to achieve sub-$300 depreciation per unit and push vehicle utilization up to 70%, boosting rates by 9.1% over the past year. [pushed prices up] [2] [6] [7] [8]
Supply chain right now
- Fleet acquisition and financing (moderate): Depreciation per vehicle has stabilized following large electric vehicle write-downs in 2024 and 2025, but elevated interest rates keep fleet financing expenses high. [2] [6] [10]
- Vehicle maintenance and insurance (critical): Ongoing increases in auto parts, repair labor, and commercial liability insurance create steady cost pressure on fleet operations. [9] [11]
- Airport and facility operations (stable): Airport concession fees and customer facility surcharges remain steady and pass through predictably to travelers at major hubs. [4] [10]
- Yield management and booking demand (moderate): Tighter aggregate fleet inventories allow rental companies to maintain elevated revenue per day during peak travel periods. [7] [8]
Researched 2026-10-18 with Google Search. Every point links to its sources; unsourced claims were removed.
Car rental prices, last 12 months
| Month | Change from a year earlier |
|---|---|
| September 2026 | +9.1% |
| August 2026 | +3.5% |
| July 2026 | −3.9% |
| June 2026 | −4.1% |
| May 2026 | −6.1% |
| April 2026 | −0.1% |
| March 2026 | +8.1% |
| February 2026 | +2.7% |
| January 2026 | −1.2% |
| December 2025 | −4.1% |
| November 2025 | −2.7% |
| September 2025 | −5.0% |
| August 2025 | −4.8% |
Source: U.S. Bureau of Labor Statistics, Consumer Price Index (CPI-U), series CUUR0000SETA04.
Sources
- Car Rental & Leasing in the US Industry Analysis, 2026 (ibisworld.com)
- HERTZ REPORTS SIGNIFICANT PROGRESS TOWARDS KEY MILESTONES FOR FIRST QUARTER 2025 - (newsroom.hertz.com)
- ycharts.com (ycharts.com)
- Car Rental Prices by City in 2026 + Seasonal Trends & Savings (rentallsoftware.com)
- U.S. Rental Car Market 2025 - Drive $39.2B Revenue (actowizsolutions.com)
- ir.avisbudgetgroup.com (ir.avisbudgetgroup.com)
- avisbudgetgroup.com (avisbudgetgroup.com)
- travelweekly.com (travelweekly.com)
- US car hire prices stabilise: outlook from Hola Car Rentals (holacarrentals.com)
- U.S. Car Rental Industry: 2025 to 2030 Market Analysis (mmcginvest.com)
- Car Rental Rates Forecast to Rise 3.6% in 2026 Before Easing in 2027 (autorentalnews.com)