The cost of renting a car has risen exponentially over the past few years due to a number of factors, including the recession and recent natural disasters which have squeezed car manufacturers.  However, Holiday Autos has revealed that prices are finally decreasing for the first time in nearly half a decade.

Annual global price of car hire
Year   Average Price
2011   £251
2010   £268
2009   £241
2008   £197

Of the 180 destinations surveyed, prices fell fastest in Ireland, where prices have dropped 51% to an average £125 for a week’s car rental. There are also bargains to be had in Gibraltar, (where prices fell by 35% to £195) and major Spanish destinations.

Top five decreases in rental prices in 2011 (compared to 2010)
Destination   Average Rental Price 11 Average Rental Price 10 Decrease %
Ireland £125   £256   -51%
Gibraltar     £195   £298   -35%
Gerona (Spain)  £228   £322   -29%
Valencia (Spain)      £217   £303   -28%
Greece £261   £343   -24%

However, there are still a number of pricing hot spots where a week’s car hire will cost in excess of £300. Switzerland tops the list of most expensive destinations for car hire this summer at £317 for one week’s rental, closely followed by France at £304 a week.

Top five most expensive destinations for car rental in 2011
Destination   Cost of one week’s car hire
Switzerland   £317
France £304
Spain - Balearics - Ibiza     £284
Portugal     £280
Italy - Islands - Sicily     £276

Hema Nagar, head of marketing at Holiday Autos says: “The fact that car hire prices are showing signs of coming down after such a long time is great news for holidaymakers. There are a number of locations where you can pick up a good deal on your rental so it’s worth thinking about destinations where your money will go further.

“However, as our data reveals, there are still places where you could pay a hefty premium for car hire, particularly if you book last minute or during peak season, so we would always advise customers to book early to ensure they get the car that suits their needs at a good price.”

* Prices based on hiring a ‘compact’ category car for seven days in July 2010 compared to July 2011.