Not every car rental experience is reliable and worry-free. Remember the three principles of renting a car: read the contract carefully, inspect the vehicle condition thoroughly, and choose a large rental company.
Holiday self-driving trips have made car rental companies’ businesses boom, and rental prices have been rising sharply over the past two years. During the Spring Festival holiday, some rental companies had all their vehicles booked out two months in advance, with rental prices surging up to five times the usual rate. The booming trend in car rentals has also given rise to many “traps” in this rapidly growing industry, catching many first-time renters off guard.
Rental agreements may hide “unfair terms”
A. Out-of-town fines must be settled within three days
Case: Last year during National Day, Ms. Wang from Guangzhou rented a car from a major rental company for a self-driving trip around Suzhou and Hangzhou. After the trip, the rental company informed her that there was a traffic fine that she had to “settle within three days,” or else they would charge a 1,000-yuan fine processing fee for the overdue payment.
“It already takes time to deal with out-of-town fines, three days is way too tight. Normally, traffic police fines give you fifteen days to settle, so this rental company’s rule is unreasonable. And 1,000 yuan is just outrageous!”
Dialogue with the rental company: When asked for verification, the rental company stated that this was a rule written in the contract, and renters should avoid violations when renting. It’s also a way to remind renters to stay safe on the road. Regarding this, Lawyer Sun Jian from Fangtai Law Firm said: There is currently no clear legal regulation on how rental companies set the amount for late fees on unpaid traffic fines, but charging 200–500 yuan per day—or even more—is unfair and unreasonable.
Investigation:
Ms. Wang’s case isn’t even the worst. The investigation found that besides the “vehicle security deposit,” renters now also have to pay a 1,000-yuan “traffic violation deposit,” which will only be refunded one month after returning the car—provided there are no violations. Additionally, some rental companies charge up to 500 yuan or more as a “processing fee” for handling violations on behalf of renters, plus a 200-yuan “late fee” per day.
Fees vary by company, but some require renters to pay the fine themselves within five working days of receiving the violation notice. The deposit is only refunded after the payment receipt is submitted to the rental company. If the fine isn’t paid within the stipulated period, it’s considered that the renter has authorized the rental company to pay on their behalf. If the violation is never resolved, the 1,000-yuan deposit will not be refunded.
B. High penalty fees
Case: Mr. Chen recently rented a car from a rental location at Beijing South Railway Station and had prepaid three days’ rent. But due to a change in plans, he needed to shorten the rental period by one day and notified the rental company one day in advance. As a result, the rental company charged him a 50% penalty fee.
Dialogue with the rental company: In recent years, more people have opted for self-driving holidays during peak seasons, and rental companies typically require a minimum rental period of “seven days or more” during busy times. Even if you return the car early, related fees won’t be refunded. Therefore, in the view of rental companies, charging penalty fees is an industry standard. Mr. Chen, a representative from a major domestic rental company, said: “Once a car is rented out, it’s in use. If a renter cancels suddenly, the resulting loss can only be borne by them. High penalty fees, or even non-refundable daily rates, are common practice in the industry.”
C. Return the car with a full tank
Case: When renting a car, all rental companies require that it be returned “with a full tank, just as it was received.” Consumer Mr. Liu complained: “The nearest gas station is nearly ten kilometers away from the rental return point, and there’s often traffic. It’s simply impossible to return the car with a full tank.” As a result, he was charged extra for a “fuel price difference and refueling service fee.”
Explanation: Reporters noticed that some car rental companies stipulate fuel charges as follows: “When the fuel gauge shows between 7/8 and full, consumers must pay: the fuel tank capacity multiplied by 1/8, then multiplied by the current market fuel price, plus a 100-yuan refueling service fee.” Because this situation is common, many renters find it hard to return the car with a full tank and often end up paying over 100 yuan in extra fuel fees.
D. Paying “downtime loss fees” for any vehicle damage
You won’t know until you read the contract—and once you do, you’ll be shocked. During the rental period, if a vehicle needs repairs, there are rules like this: “For repairs beyond insurance coverage, the customer must pay the corresponding repair costs, in addition to lost rental income.” Furthermore, some rental companies stipulate: “If an accident (including those covered by insurance), improper operation by the customer, or loss of documents affects normal vehicle operation, the customer must compensate for the rental downtime loss as per the following terms.” The “downtime loss” is calculated as: the higher of either the rental price of the same type of vehicle during the downtime or the rental price stated on the contract, multiplied by the number of downtime days. Under normal driving conditions, even if a vehicle only needs body repair without panel beating or painting, the downtime is counted as one day. So, based on a daily rental fee of 100 yuan, even for a new scratch, the consumer has to pay an extra 100 yuan on top of repair costs.
Not all rental companies are so nitpicky about minor scratches, but some are particularly harsh—even charging a 1,000-yuan deposit.
Consumer question: Is this double-charging?
Many consumers feel these rules are unfair and amount to double-charging. “Rental companies already have comprehensive insurance for their vehicles, so repair costs can be covered by claims. There’s absolutely no need to make consumers pay again.” Ms. Feng, who has extensive experience in self-driving car rentals both domestically and abroad, said: Foreign rental companies usually don’t bother with minor vehicle damage because it’s covered by insurance. But in China, rental companies inspect the car very strictly upon return. “Since the rental company has already insured the vehicle, and renters even pay extra for accident insurance, why charge an additional ‘downtime loss fee’?”
Dialogue with the rental company: Reporters interviewed several rental companies, and the responses from relevant managers were consistent: “The vehicle incurs operational costs every day, and the downtime costs caused by renter-induced issues should be borne by the consumer.” In business terms, while you can’t say the rental company is wrong, it still leaves a bad taste.
Rental companies have many “major flaws”
With the car rental market booming, many companies have jumped in. But aside from large chains that focus on vehicle condition and service, many rental companies not only have controversial contracts, but the vehicles they offer are also in poor condition—sometimes putting consumers at risk of additional liability.
1. Poor maintenance leads to concerning vehicle conditions
Case: Ms. Wei recently rented a small sedan that looked clean and shiny on the outside, but the moment she opened the door, she was nearly knocked out by the stench inside—it was completely undrivable. But since she had already paid and was in a hurry, she had no choice but to “put up with it.”
Mr. Xiao rented a Fit from a rental company near his home for a trip back to his hometown during the New Year. When he reached the Shaoguan section, it started to drizzle, and he discovered the windshield wipers were broken. At first, they worked a little, but couldn’t clean the windshield properly, and eventually stopped working altogether. He drove the whole way in the rain, terrified and in danger.
Explanation: Some poorly managed rental companies offer vehicles in conditions that are simply worrying. Rental cars pass through different renters, leading to deteriorated conditions. To cut costs, some companies reduce maintenance expenses, resulting in questionable vehicle states. Hygiene issues might be the least of your worries—the real concern is poor vehicle condition, which can easily lead to dangerous situations. Especially check essentials like wipers, brakes, and lights before signing the contract.
2. Renting a Private Car Is Unreliable
Case: Mr. Fang rented an Accord from a car rental company. During the trip, a traffic accident occurred, resulting in injuries. The rental company informed him that he had to bear most of the accident-related costs, including vehicle repairs and medical expenses for the injured. The insurance company would not cover any of it. It turned out that he had rented a private car affiliated with the rental company, and the private car owner had only purchased compulsory traffic insurance.
Explanation: Many small-scale car rental companies, due to cost constraints, allow private cars to be registered as rental vehicles. Many high-end luxury cars offered by small rental companies on the market are actually privately owned. When renting from these companies, you might unknowingly end up with a “private car.”
Insurance companies stipulate that they will not compensate for accidents involving private cars used for commercial purposes. Therefore, if consumers rent such vehicles and an accident occurs, they may have to cover repair costs and compensation out of their own pockets. As a result, rental contracts should clearly specify relevant terms, and it’s best to ask the provider to show the insurance policy and verify the coverage to avoid disputes.
3. Simplified Procedures Make You More Vulnerable
Some car rental companies, in order to make a profit, deliberately simplify procedures under the guise of convenience for renters or conceal vehicle flaws and faults during the rental process. Later, if problems arise when returning the car, they may withhold the deposit privately or demand that the renter pay for repairs. Disputes often occur due to renters not inspecting the vehicle carefully or thoroughly, or failing to fill out the inspection form diligently after the check. For example, if a damaged car part is missed during inspection, the rental company may hold the renter responsible for compensation when the car is returned.
4. Beware of Unclear Liability for Compensation
Among rental vehicles, some have agreements with insurance companies stating that accidents caused by drivers other than the designated ones will not be covered. Such terms mean that if the renter is involved in an accident, the entire liability for compensation falls on them, which can lead to legal disputes due to the increased financial burden on consumers.
Some rental companies also include clauses in the contract such as “the company requires the renter to continue paying rent until the police file a case in the event of vehicle loss.” Additionally, if an accident occurs, the compensation materials provided by the renter must be complete and clear; otherwise, if the insurance company refuses to pay due to this, the renter will be held responsible.