Lease Vs Rent


This blog describes our experience between leasing and renting a car while driving in Western Europe.  We leased a vehicle for just over a month in 2019 while we were in Geneva, Switzerland.  We drove the vehicle mainly through Switzerland, Germany and a little bit of northern Italy and France.  We rented three separate vehicles for almost three months during our return trip to Europe in 2021.  We also describe some important lessons we learned about renting a car that would have added hundreds of dollars to our rental cost.  The names of the leasing and rental companies are purposely omitted in this article.



The main advantage of leasing a vehicle abroad is peace of mind.  According to the leasing company’s website we used (as of December 2021), comprehensive insurance is included in the lease contract.  We did not have to worry about somebody ding-ing or scratching the vehicle unlike when we rent a car and decline the expensive collision damage waiver (CDW).  Another advantage is that there is no additional cost for an extra driver.

The leasing company we used contracts with Peugeot and Citreon.  We were told by the Peugeot dealer when we picked up our car that the vehicle is registered under our name during the lease agreement.  This explains why the leasing company asked for at least a couple of weeks to process the leasing agreement.  This will allow them to send the signed paperwork along with copies of our passport and driver licenses to the Peugeot dealer so they can have the vehicle registered under our name.  Bottom line, don’t expect to get a vehicle the following day if you want to lease one.


The main disadvantage of leasing is that there is a limited number of European cities where a leased vehicle can be picked up.  The Peugeot dealer where we picked up our vehicle was in a small town about 15 minutes from Geneva, Switzerland.  They did not have a counter at the Geneva airport.  The Peugeot dealership had a shuttle van but they said they could not pick us up at the Geneva airport.  So we ended up just staying in the French side near the Geneva airport which was better since it is more expensive in Switzerland compared to France.

The other challenge we had to overcome was completing the necessary paperwork while we were traveling.  The leasing company required us to physically sign the leasing documents and send it back to them.  We were doing the Tour du Mont Blanc at that time so we virtually had no Internet unless we were in a town or city.  On top of that, we were trying to do it over our smart phone and tablet.  It’s just how our schedule worked out as it was fluid so we could not have applied to lease a vehicle before we left the US.  However, the leasing company was very helpful whenever I called them for assistance.


I cannot really come up with a reason why renting a vehicle would be advantageous or disadvantageous compared to leasing.  The only thing I can say is that sometimes renting can cost less than leasing, even if you take the additional insurance offered by the rental company (this was not the case for us in 2019 so we leased a vehicle).

The only thing I don’t like about renting is the experience whenever we are at the counter.  They always try to scare you with the “you are not protected” spiel for declining their expensive insurance coverage.  A long time ago, I read a rental company’s insurance coverage and I came out asking “what is this really protecting” as it had a lot of situations where the insurance would not apply, not to mention it had a high deductible.  So from then on, we always declined a rental company’s insurance as we felt they were the one being protected, not me.

Lessons Learned

The Fine Print

In 2021, we got a great deal from a well known global chain car rental company in Vienna, Austria.  It was less than 700 Euros for 31 days.  Of course, that’s the basic rental cost.  It did not include insurance and all the other optional add ons. Still, it was much less than the amount I paid for leasing a car in 2019.  As with anything that seems too good to be true, this particular rental car agency had a surprise for us.  Their terms and conditions (Ts and Cs) states something like:

DRIVING RESTRICTION: For traveling abroad, a local mandatory fee of XX to YY Euros will be added depending on the size of the vehicle.  The vehicle may be driven in EU countries except (they name the countries) and Switzerland.  Use of ferries is prohibited.

The Ts and Cs did not define the word “abroad”.  Since the second sentence states that the vehicle can be driven in any EU country except those listed, we naturally understood that abroad meant outside of EU.  Even the representative at the rental car company’s 800 number initially had the same interpretation but later changed her tune after she placed us on hold to verify.  So, the gripe here is that, you cannot cross the border of the country where you rented the car without paying the additional mandatory fee which for our case was an additional 500 Euros.  Surprise!  This made us remember the same issue when we were getting our rental car in Spokane, Washington in 2018.  The agent behind the counter asked us, ““Are you driving to Canada?” Once we said yes, the agent said that we had to pay extra.  Lucky for us, the next counter had a car available and did not charge any extra to drive to Canada.

So the lesson is to understand the rental car’s Ts and Cs before picking up a rental car so that there are no surprises.  If renting a car in Europe and may be driving through more than one country, then make sure the car reserved allows driving to other countries at the quoted price.  More than likely, a customer service representative will try to verify that information instead of the person behind the actual rental counter.  In this instance, it would be advisable to get the clarification in writing as opposed to trying to convince the person behind the rental counter that a customer service representative said the vehicle can be driven in a different country without additional charges.  European countries are a lot smaller than the US that crossing borders is very likely.

CDW and Credit Cards

We always decline the rental company’s supplementary insurance.  Our credit card has Collision Damage Waiver (CDW) coverage but only if the rental duration is not more than 31 consecutive days.  So on our trip to Vienna, we planned on driving a total of 60 something days between Austria and Italy.  We had to make two separate reservations where we returned the first car after the 31st day and picked up another car for the remainder of the trip.  I know what you are asking by now – “why not drop the first vehicle off at a different city and pick up the second vehicle there?”.  We looked into that and it was more expensive to go that route than to burn an extra two days of returning the first car and picking up the second car in Vienna. 

We could have accepted the Rental company’s CDW, but it would have been more expensive compared to the extra gas and days to drive the first car back to the rental place.  At any rate, there is no right or wrong choice here.  Accepting the rental car’s CDW offers some peace of mind (assuming the deductible is reasonable).  We just choose to decline it and take our chances.

Final Thoughts

For us, the decision to lease or rent just comes down mainly on cost.  I would prefer to lease if the cost is not too far off the cost of renting.  If we have to rent a vehicle, we make sure that the credit card we use has CDW.  And we just don’t look at the printed credit card benefits at the time we received the card.  We always call the credit card company to verify the coverage and get it in writing.  We do this extra step because companies change policies that we may have missed since we don’t always read our mail.  

Reading the car rental company’s T’s and C’s may not be enough. It is always better to verify that we have interpreted the T’s and C’s correctly rather than be surprised on the day of picking up the rental car.

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