I’m always on the lookout for ways to reduce car rental costs and/or earn some value back on those that I do pay for. One that I’ve struggled with for a while is whether Hertz points are worthwhile.
After putting a fair bit of thought into it, I feel pretty comfortable suggesting $.07/point for us but you may find significantly higher value if you rent minivans, value premium cars, do one-way’s, or aren’t willing to work quite as hard as I am to get a rental cheaply.
Redeeming for Car Rentals
I can reliably find free or nearly free airfare and hotels but cars are a different matter and so I shop cars aggressively to keep costs down.
For valuation purposes, I also tend to go above a compact only when the step is very small. We don’t rent premium cars nor SUV’s nor minivans so, for me, the baseline is what I’d save on rentals we would otherwise pay for. I looked back over my last 5 rentals which appeared typical and we paid an average of $28.22/day with a high (real outlier) of $39.82/day. The 5 were in 4 different cities and all but one were weekend rentals. The most expensive one was mid-week. Of course, we don’t want to redeem our points for an average rental (unless you’re swimming in points) but a high cost rental therefore I’ll suggest a starting point of a 1-day weekend rental being worth $30 and a weekday of $35. I really should sample a bit more data but these feel right though maybe a bit low.
A weekend rental is 500 points/day while a weekday rental is 600/day under the Standard Rewards program however when I played around with awards in 5 different airports, I had to pay fees ranging from $5 to $17 which were not covered by the points per the web site however multiple sources confirm you don’t actually pay them at the counter. I’ll take their word for it and assume there are no taxes/fees on award rentals. 500 points saving $30 should yield a point value of $.06 and 600 points saving $35 yields about the same.
There is another important factor here… It’s 500/600 points regardless of whether you select a small compact car or premium car (e.g. a Nissan Maxima). I’d sure take the Maxima over the Aveo but it’s very subjective how one would value the nicer car. As someone who clearly won’t pay more than a few dollars for it, it’s not worth much to me. That said, it seems reasonable to round a gold point up to at least $.07 in consideration of this.
Bizarrely, when moving from a 2 to 3 day and from a 3 to 4 day rental, the daily rate jumps up by 100 points. Then you hit a weekly rental for the 5-7 day rate. The clear sweet spot is at 7 days for 2500 points or 357/day. I’m not sure how to value that since the chart gets worse where I want to use (3 day rentals are common for us) and better where we don’t (5+ day). I’ll call it a wash but if you do week-long rentals, this could make a 2500 point balance quite useful.
500 points gets you a double upgrade in car class but is subject to a limit of a premium car. It appears that it works regardless of number of days so I suppose if you value a nicer car significantly and have it for an extended rental, this could be a good option but that doesn’t apply to me and seems a pretty special case.
On the other hand, the specialty rentals include minivans which can be very
useful necessary for families travelling. I sampled 5 cities for a weekend minivan and it was consistently $100+/day with one exception which used a budget brands. Assuming that my bag of other tricks could bring this down to $90/day (really guessing here) and deducting fees, that would save us about $78/day. A specialty car is a 2 day minimum of 1800 points which implies that a point is worth $.087.
I really prefer to fly if it’s a significant distance but that doesn’t always work and one-way rentals can be terribly expensive (but sometimes not). We tend to do one or two one-way rentals per year and often find ourselves comparing them to the cost of a flight in which case $100 for a car that can carry two people seems a bargain on a 100-300 mile trip where flying would take just as long. The car companies know this (and have their own fleet management issues of course).
To redeem points, it’s twice the price (e.g. 1000 for a weekend one-way). I sampled 5 one-way rentals and the variation was crazy… $42/day to $180/day. That’s consistent with my experience but I didn’t shop it via my usual bag of tricks so I honestly think it’s likely worth closer to $80. Deduct fees and this values a Hertz point at about $.07.
Off Airport Locations
Surprisingly, it appears that you can redeem points for awards at off-airport locations. The reason I’m surprised is that in many car programs, off airport locations are franchisees that don’t participate in the rewards aspect of car programs, at least in my experience. Kudo’s to Hertz (assuming my experience can be generalized).
Converting to Airline Points
Hertz Gold Plus points may be converted to the following but only in 600 point increments.
600 GP : 500 miles in Aeroplan, Alaska Airlines, American Airlines, Amtrak, Delta, Frontier, Hawaiian, JetBlue, Spirit, and US Air.
600 GP : 1000 Marriott or Priority Club
600 GP : 1200 Southwest.
The most compelling value to me is the Southwest option as I value those at $.018 each which thus establishes a GP as $.036 each. All other options pale in comparison, in my opinion. Even if you don’t fly Southwest, I keep finding that it’s worth picking them up here and there.
I believe that the value of a point is generally separate from the rate at which one earns them however it’s obviously worth a bit of coverage here. Hertz points are earned at the rate of 1 point per dollar spent on the base rental (excludes taxes, airport fees, etc) though reasonably often lately I’ve noticed that they run double point promotions. When I get a cheap rental, the base rental cost may only be 2/3rd’s of the actual cost. Before every rental I check FrequentFlyerBonuses.com and here’s a direct link to their Hertz promotion page. They can be earned in many countries outside the US but definitely not all. Interestingly, I picked up some in South Africa last fall despite it not being on the list but not on the trip back to Cape Town that followed it just 3 months later.
One disappointing aspect is that there are so, so few ways to earn Hertz gold points. No credit card. No crediting hotel stays to Hertz that I’ve found. Chase Ultimate Rewards, Amex Membership Rewards, and Starwood Preferred Guest points don’t transfer… What’s a points hoarder to do?!?!
Tip: The one exception I’ve found is e-Rewards where one can redeem $60 (never mind the dollar sign, it’s not real money) of e-Rewards for 500 Hertz points. I actually think that may be a bargain if you collect e-Rewards since a comparable redemption is $50 of credit for 1000 US Air, Delta, Southwest, United, or American miles. If you do the math, I think Hertz is about a 60% better use of e-Rewards than the others. That said, I only have any e-Rewards due to the ability to use it as a hit in the US Air grand slam promotion and it’s kind of a painful way otherwise to build up balances. If the Grand Slam doesn’t come back, I know where my e-Rewards credit is going. Any day now we should hear…
On the plus side, you may transfer your points to a spouse or domestic partner but you can’t combine them with anyone else’s (e.g. one rental must be paid for in full with points from one account). Useful feature.
Tip: On the other hand, they do appear to have an expiration 2 years after no activity within the account where activity means a Gold Plus Rewards Point was either earned or redeemed. I don’t see that Awardwallet is tracking this so it may be a good idea to add a date to your account so you get notified.
To make matters worse, their website will only show activity for the last 6 months and no expiration date is visible. Update…Awardwallet’s link to Hertz does bring you a page where it tells you whether any points expire Dec 31 of the current year which is somewhat helpful. Unfortunately, I can’t find a way to navigate to that page from Hertz.com so use the link I just gave you or remember that Awardwallet can bring you to that hidden page that gives you a little expiration info at least. It’s still worth entering some expiration date at AwardWallet so that you get notifications of pending expiration issues.
Would I actually choose Hertz points in practice?
million $30 dollar question isn’t it??? My approach is always to compare costs after deducting what I’d pay for the points (typically I’ll pay about 33% of their value in cash). There some exceptional promotions (e.g. 5000 AA for a 3-day rental this weekend) but I tend to find that I most often collect 600-1200 Southwest points on a 1-3 day rental so I think that’s a fair comparison. Let’s consider a not-uncommon hypothetical skewed slightly to favor Hertz:
$40/day all-in for 3 days would cost $120. Let’s assume I had the same price with earning options on the rental:
A) Double southwest points, totaling 1200 points are worth $21.60 (but I’d probably only pay $7.20 in cash for it).
B) ~$90 in base rental costs with a double hertz point promotion yields 180 Hertz. At $.07 each, that’s just $12.60 in points back for which I’d probably only pay up to ~$4 or maybe $5 in increased costs.
Even in this example skewed in Hertz’s favor with our rental profile, Southwest is winning by a good distance. The Hertz program is clearly designed, in my opinion, for business travelers that have quite a high rental spend. My spend is too low on cars and spread around too many companies to make this worth a whole lot to us and, to make matters worse, there’s the expiration date issue which is compounded by our very slow rate of earning.
If Hertz would bump the earnings rate up just a bit, eliminate point expiration or at least let Awardwallet track it, and link up with transfer partners though, I could see myself paying a lot more attention. It’s close to a program I’d be interested in.