What’s happening to rental car prices?
It did not escape anyone who rented a car in Mallorca during the summer of 2022 that rental car prices reached new heights. If you were lucky enough to find a car in the exact class you wanted, so to speak. There are several explanations for this. A lack of vehicles and very high demand are two of the main reasons.
Before 2019, there were approximately 120,000 registered rental vehicles in the Balearic Islands. In the wake of the pandemic, around 50,000 cars were shipped back to the mainland. This put car rental companies in a difficult position when tourists returned and demand skyrocketed. The situation has not improved much, as car manufacturers continue to struggle with delivery delays despite new vehicle orders.
In the spring of 2022, the Vehicle Rental Business Association (Aevab) and the Balearic Association of Rental Companies (Baleval) predicted that the lack of vehicles will push prices up by over 40% for the whole year. That would make Mallorca and the other islands the destination in the Mediterranean where rental car prices increase the most. This turned out to be true, not least during the high season when the price increase has been much higher than that.
Apart from the price increase, car rental companies, among others at Palma airport, testify to difficulties in meeting customers’ wishes. Many travelers do not book their cars in advance, but only do so upon arrival.
So what can you expect this summer? Even higher prices or limited access to vehicles?
Judging by the forecasts, both! According to Baleval CEO, Othman Ktiri, the outlook for the season looks good “and with fewer problems than previous years due to the lack of rental cars caused by production levels”. It is unclear whether he is aware of the statistics from the analysis platform Dingus Data Hotel which show that foreign bookings for Mallorca between May 1 and October 31 will increase by 24-28% compared to 2019. However, it is expected that the number of cars will not exceed 75,000 which is in line with the 2022 season.
Meanwhile, there is an ongoing debate about what should be considered an acceptable number of rental cars in the Balearic Islands from an environmental perspective. While more cars benefit tourism, they do not necessarily benefit the environment or the local population. As a result, policymakers face difficult decisions. One thing is certain: the pandemic has already led to some uncomfortable, albeit involuntary, measures that have slowed the growth in the number of registered vehicles on the islands.
However, a quick review of prices for ECMN/R and EDMR vehicles — smaller economy-class cars such as the Peugeot 107, Renault Clio, and Ford Fiesta — shows that prices are largely the same as last year or slightly higher. The search was conducted in February 2023 and applies to bookings for the first week of June, July, and August. It is worth noting that prices tend to rise the closer you get to the departure date.
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