Iceland, with its stunning landscapes and unique attractions, is a dream destination for many. One of the best ways to explore this Nordic island is by car. Renting a car in Iceland gives you the freedom to travel at your own pace. It allows you to visit remote locations that are often missed by tour buses.
But how much does it cost to rent a car in Iceland? This is a common question among travelers planning their Icelandic adventure. In this comprehensive guide, we will delve into the costs associated with car rental in Iceland.
We will look at the factors that affect rental price, compare costs for different types of vehicles, and also give tips on how to find the best deals. By the end of this article, you’ll have a clear understanding of what to expect when you rent a car in Iceland. Let’s get started.
Understanding Car Rental Costs in Iceland
Renting a car in Iceland isn’t just about daily rates. It’s essential to consider several cost factors. Here’s an overview of what influences rental prices.
- Duration of rental: Longer rentals can often lead to discounted rates. Take Hertz Iceland for example, you’ll get the lowest daily rental rate when renting a car from 7 days to 10 days.
- Seasonality: Prices fluctuate between peak seasons (summer June – Aug) and off-peak seasons (winter Nov – March). Rental price will be the highest in peak seasons
- Vehicle type: Economy cars are usually cheaper than SUVs or campers. and Manual car is cheaper than automatic
- Insurance coverage: Additional coverage increases total costs, BUT! it reduces a great cost when accident happens to the car!
- Location: Urban rental offices usually charge lower rates than remote locations.
Factors Influencing Rental Prices
Several key factors play a role in determining car rental prices in Iceland. One significant aspect is the time of year. During the summer months, when tourists flock to Iceland, demand for rental cars is high. This can result in increased prices and a scarcity of availability.
Another crucial factor is the type of vehicle you choose. Economy cars generally offer the most affordable rates, while larger vehicles like SUVs or 4x4s can be pricier. These are often necessary for safely exploring Iceland’s rougher terrains.
Moreover, the level of insurance coverage you select can greatly impact rental costs. Additional coverage offers peace of mind but comes at a premium.
Average Price Range for Different Vehicle Types
Iceland offers a variety of rental car types to suit different needs and budgets. Here’s a breakdown of the average costs for various vehicle categories. We’ve prepared a compare table that contains different types of cars and its price range peak season vs winter season
Average Price Range for Different Vehicle Types 2025 | ||
| Lowest daily rental price/ | Summer (mid-May – mid Sep) | Winter (Oct – mid May) |
| Economy cars (e.g. Toyota Yaris) | From 8,906 ISK /day (~ 63.39 USD ) | From 7,895 ISK /day (~ 56.20 USD ) |
| Compact (e.g. VW Golf) | From 10,658 ISK /day (~ 75.86 USD ) | From 8,282 ISK /day (~ 58.95 USD ) |
| Mid-Size / intermediate (e.g. Kia Sportage) | From 11,870 ISK /day (~ 84.49 USD ) | From 8,762 ISK /day (~ 62.37 USD ) |
| Full-size (e.g. Kia Sorento) | From 22,154 ISK /day (~ 157.69 USD ) | From 15,412 ISK /day (~ 109.70 USD ) |
| Campervans / RV (e.g. Fiat Benivan 120 Motorhome) | From 43,366 ISK /day (~308.68 USD ) | From 29,030 ISK /day (~ 206.63 USD ) |
| Passenger Vans (e.g. 8 seats Toyota Proace Verso) | From 32,749 ISK /day (~233.11 USD ) | From 32,146 ISK /day (~ 228.81 USD ) |
Choosing the Right Rental Car for Your Iceland Adventure
Choosing the right car for your trip to Iceland is important for your safety and enjoyment. Think about the terrain and weather you’ll face. Different areas require different vehicle types.
If you’ll stay on paved roads, a standard car is fine. But for exploring the Highlands, a 4×4 is necessary for F-roads.
Your itinerary matters too. Consider distances, road types, and how many people will travel with you. You may need a larger vehicle for longer trips or groups.
Finally, keep your budget in mind. Weigh cost against comfort, safety, and versatility when selecting your car.
Rental Car Types and Their Suitability for Icelandic Terrain
Iceland’s unique landscape requires careful consideration of car rental types. The right choice enhances both comfort and safety. Here you can find an overview of the different types
- Economy cars: Best for paved roads in urban and areas and main road
- Compact and Mid-Size Sedans: Families or small groups traveling on paved routes.
- SUVs: Good for varied terrain.
- 4x4s: Essential for F-road adventures and winter icy road conditions
- Luxury cars: Ideal for comfort, but not for rough roads
- Campervans: 4×4 campers are good for all roads and weather conditions, motorhomes are good for paved roads in summer
- Passenger Vans: Ring road, paved roads, opt for 4×4 version when travelling in winter
- Electric and Hybrid Vehicles: all types of roads except the F-roads (mountain roads)
Consider the terrain you’ll encounter and choose accordingly. Each option offers specific advantages, aligning with different types of travel itineraries.
Seasonal Considerations and Booking Tips
When planning a trip to Iceland, seasonality plays a key role in choosing a rental car. Summer brings clear roads but higher rental prices due to demand.
Winter presents challenges like snow and ice, making 4×4 vehicles advisable. Equipped with winter tires, these vehicles handle slippery conditions better.
Booking in advance is important all year round. It ensures you get your preferred vehicle and often leads to better rates.
Think about your travel goals. If you’re heading to see summer’s Midnight Sun or winter’s Northern Lights, rental vehicle availability can vary.
Using online platforms can help you compare prices and read customer reviews, making it easier to find good deals. Look for discounts, especially when you book several months ahead.
Picking Up Your Rental: Airport vs. City car rental location
Airport locations like KEF Iceland international Airport often offer the easiest access, allowing travelers to start their journey immediately upon arrival. However, rentals at airports may cost more than those in city centers due to additional airport tax will be charged by the Iceland airports.
Rental offices in the city have good prices. They are a good option if you start your trip after staying in Reykjavík. Think about how close they are to where you stay and to main roads.
Yet, city pickups require additional transport arrangements to reach the rental office, adding complexity. Weighing immediate convenience against potential savings is key.
Choose your rental car based on where you start your trip. If you want to start your adventure right away from the airport, that option is available. If you prefer discounts in the city, you can choose that location instead. Both choices can fit different travel plans in Iceland.
The Role of Gas Prices in Your Rental Decision
Gas prices play a significant role in the overall cost of renting a car in Iceland, as Iceland is the second highest place in the world in terms of Gas price stated in a report conducted in year 2025. As fuel expenses can fluctuate, understanding these costs helps in budgeting your trip.
In Iceland, gas prices are usually higher than in other countries. This can make long road trips more expensive. Choosing a fuel-efficient car can help you save money on gas.
Plan routes and stops to optimize fuel usage. Remember, remote areas may have fewer gas stations, affecting both cost and availability.
Ultimately, considering gas prices in advance ensures a smoother and more predictable travel experience through Iceland’s breathtaking landscapes.
Fuel Policies and Efficiency Tips
Before renting, familiarize yourself with the fuel policy of your chosen rental company. Policies may vary, with some requiring a return with a full tank, while others charge for fuel used.
Choosing the right policy can affect costs and convenience during your trip.
To enhance fuel efficiency, consider driving strategies. Maintain consistent speeds, reduce idling, and avoid unnecessary weight in the vehicle. These tactics help to stretch each tank further.
Additionally, select a car that matches your travel needs and terrain requirements. A compact car generally uses less fuel than larger vehicles, making it a wise choice for budget-conscious travelers.
Finding the Cheapest Rental Cars in Iceland
Finding the cheapest rental cars in Iceland requires a bit of research and timing. Prices can vary widely based on the season, demand, and location.
For budget-conscious travelers, compare offers from different providers, including both local and international rental companies. Early booking can often unlock substantial savings, ensuring you get the best possible rates. Pro tips: You can always count on Hertz Iceland’s website to find a good price rental car with high qulity!
Tips for Scoring the Best Deals
Scoring the best deals on car rentals in Iceland involves strategic planning and smart decision-making. By following certain tips, you can secure a rental car that fits your budget.
Here are some practical steps to help find the best deals:
- Book in Advance: Early reservations typically offer the best prices.
- Compare Rates: Use online platforms to compare multiple companies.
- Look for Discounts: Check for promotional offers or membership discounts.
Choosing the right rental period can also influence the total cost. Renting during the off-peak season often yields more affordable rates compared to peak tourist times.
Additionally, signing up for newsletters from rental companies can alert you to exclusive deals. Consider flexible travel dates, as shifting your rental period slightly could lead to lower prices and better availability.
Selecting a car rental Company in Iceland: What to Look For
Choosing the right rental company in Iceland can enhance your travel experience. Begin by considering companies with strong customer reviews.
Look for transparent pricing without hidden fees. This ensures you get value for your money.
Customer service is crucial too. A company with excellent support can make your journey smoother. Prioritize rental companies that offer roadside assistance and comprehensive insurance options.
Comparing Local vs. International Rental Companies
When renting a car in Iceland, you’ll encounter both local and international rental companies. Each has its unique advantages, but it’s important to understand how they differ and where they excel.
Local Companies: Local rental companies often provide personalized service and unique packages tailored specifically for Icelandic roads. They may offer bundled deals.
They have fewer pick-up locations and a smaller selection of vehicles. They also have less customer support for vehicle repairs and emergency help.
International Companies: International brands, especially Hertz Iceland, we have a mix global standards with local know-how.
Hertz Iceland has been in business locally for over 50 years. This makes it a reliable choice, as we know the roads and landscape of Iceland very well.
Unlike some local providers, international companies may not offer bundled packages. However, we specialize in renting quality cars. We also provide extras like insurance and GPS systems to improve your travel experience.
Hertz Iceland provides:
- A wide range of under 2 years old vehicles to suit different terrains and travel needs.
- Convenient pick-up locations, including Keflavík International Airport and Reykjavík, in total of 13 locations across the island.
- Transparent pricing with no hidden fees.
- Exceptional customer service, including emergency roadside assistance.
When deciding between local and international providers, consider your travel needs and priorities.
With Hertz Iceland, you get the trust of a well-known brand and the knowledge of a local company. This means you can have a smooth and enjoyable driving experience in Iceland.
Preparing for Your Icelandic Road Trip
Ultimately, preparing for your Icelandic road trip goes beyond just budgeting for car rentals. It’s crucial to ensure you have all necessary documentation in order to avoid any last-minute issues.
Please ensure you have a valid driving license is written English. If not in English, you will also need to get an international driver license.
Please note that you need to be at least 20 years old to rent a car in Iceland. Your driver’s license must be valid and issued within the last 12 months. If you are 18 years old, you will not be able to rent with any popular rental car company in Iceland.
Additionally, having a credit card ready for the rental transaction is essential. By taking these steps, you can enjoy a seamless and enjoyable driving experience through Iceland’s breathtaking landscapes.
