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To prepay, or not to prepay…. that is the question

To prepay, or not to prepay…. that is the question

3 min
Posted: 08 March 2016
Topics: SavingsBlog

I am, of course, referring to the gas for your rental car. As debates go, it’s not exactly Evolution vs. Intelligent Design, but then again I'm neither a biologist nor a theologian. I’m the guy who manages the Egencia Ground Supply organization in North America. So instead of the origins of life, you get to read about the exciting world of Rental Car Ancillary Product purchases! Anyway, let’s keep things moving… Picture yourself at the car rental counter. As part of the agent’s upsell pitch, they ask if you want to prepay for fuel to avoid having to fill up the tank before returning the car. There is a long line of impatient customers behind you, and you only have a split second to make a decision. What do you do? What. Do. You. DO?

  1. DECLINE: If your instincts are anything like mine, you assume fuel prepay is another “product” whose sole purpose is to extract more revenue from you, and you say no. Cynical? Sure, but in this case your cynicism could come at a cost. If you’re in a rush to get back to the airport for a flight and don’t have time to refill the tank, some car rental companies will charge you an exorbitant price per gallon for their “service” – to the tune of $9.99 per gallon or more!
  2. ACCEPT: You purchase the prepaid fuel. This means, they charge you upfront at the local “market rate” per gallon for a full tank of gas, based on the average tank size of the car type you rented. At this point you can expect the inevitable catch, and with it the opportunity to express your own version of Seinfeld’s proclamation of disgust: “Newman!” In fact, there is a catch, but you can make it work in your favor. Your final fuel charges will be the same regardless of the tank level when the car is returned. There is no refund for partially filled tank. In effect, it’s a net-fee to you depending on your ability to manage the fuel level and return the car with the tank as close to empty as possible. The potential cost ranges for fuel is illustrated below. In essence, returning the car with a full tank will be your “Newman!” moment.

Perhaps recognizing the perceived inequity of this situation, Hertz and Avis Budget offer “Express Options” designed for those of us driving the vehicle less than 75 miles for the duration of the rental. Perhaps you have a truncated business trip or inexplicably decide to rent a car in Las Vegas. (OK, that was me.) If you fit these mileage criteria and don’t return the tank full, they will charge you a flat fee of $13.99. Enterprise and National do not offer a similar product, but do substantially “cap” the cost of refilled gas (max $2/gallon over local market, generally less than the competition) as a nod to their value-oriented product philosophy. Ideally, try to determine in advance whether you will have time to refill the tank before returning the car. If you are unsure, understanding all your fuel purchase options can mitigate potential financial pitfalls. The bottom line: a business trip is a lot like walking a balance beam. Sometimes your equilibrium is thrown off by either choice or circumstance, resulting in a fall. The trick is to influence in which direction you might fall and, more importantly, in what you end up landing.

Here are some links to FAQs with refueling information: AVIS FAQ Hertz FAQ National FAQ Enterprise FAQ.

Travel Safe! Michael Tribuch, Director, Supplier Revenue & Strategy, Egencia

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