Portugal car rental tips. Cars parked in a cobbled street

If you want to explore beyond Lisbon and Porto, it may be best to rent a car in Portugal to give you full flexibility over where you go and when. Hiring a car in Portugal is fairly straightforward if you know what to watch out for, as is driving here.

These insider car hire tips will help you save money and avoid feeling ripped off by unanticipated charges when you collect your rental car in Portugal.

There are car rental offices in all major Portuguese airports and cities but don’t wait until you get here to find a car to rent – that will always cost more than booking ahead.

Tips for getting the best price when you rent a car in Portugal

It’s never too soon to book a hire car

You can get some fantastic deals on car rentals in Portugal if you book well ahead. The later you leave it, especially at peak holiday periods, the higher the cost will be.

As an example, when I first started looking at car hire in the Azores Islands, I could have rented a car for 3 full days for about €50 in São Miguel. By the time I got around to booking one a month later, the cost had doubled. If I’d left it until I got to the airport, I’d have had to pay at least €100 per day for a tiny car.

My advice: Use a comparison website like Rentalcars or Discovercars to see what’s available and compare prices between rental companies e.g. Hertz, EuropeCar, Budget and others you may not have heard of. 

You can filter for a specific supplier, location or rating as well as other important features. This is what I do and I’ve had a great experience so far with both Discover Cars and Rentalcars.com.

If you find a deal that suits you, book it up. With most companies offering free cancellation, you can always get your money back if you spot a better offer or change your plans.

Compare prices with Rentalcars.com
Rentalcars.com search results
Rentalcars.com search results
Search results page at Discovercars.com
Discovercars.com search results

Car rental periods

Car hire is typically charged per 24-hour period so if you pick up a car at 10 am on day 1 and return it at 11 am on day 2, you’ll end up paying for 2 days.

Avoid this by carefully selecting your pick up and drop off times. You also need to double check opening hours for rental offices away from the airports and especially in smaller cities. Many close at 7 or 8 pm during the week and at 1 pm on Saturdays for the rest of the weekend. If you can’t return your car before they shut, you may have to pay to keep it until the following working day or pay an extra fee.

Tip: If you need a car for 5 or 6 days, try altering your search to see how much it would cost over 7 days. You may find a cheaper weekly deal and there’s nothing to stop you returning the car before the end of the hire period.

One way car rentals and different drop-off locations

Although one way rentals may be described as being free within Portugal, the reality is that if your drop off point is different from the pick up location, even within the same city, you will pay more, sometimes considerably so.

How to deal with this: Plan your itinerary to come full circle so you can use the same pick up and drop off location. Look into the cost of public transport or taxis to or from pick up and drop off locations if necessary to see what is most cost-effective and convenient for you.

If you are flying in and out of different airports, it may even be worth arranging two separate car rentals.

Automatic or manual transmission?

Most cars in Portugal have manual transmission which means that automatic cars are in short supply and therefore are more expensive to hire, usually double the price.

What to do about this: If you’re not used to driving a manual car, it’s not that bad really. Get some practice in at home before you have to start dealing with unfamiliar roads and signs.

Size matters

While they may be poky compared to what you normally drive, ‘economy’ cars are generally roomy enough for two people who are travelling light. They won’t have much ooomph for overtaking and you’ll have to drop a gear or two to get up steep hills but when it comes to parking, you’ll appreciate the merits of a small vehicle. If you’re venturing into tiny villages and country lanes, or even the historical parts of bigger cities, a dinky car is a definite advantage.

My advice: ‘Mini’ or ‘economy’ cars will usually be the cheapest to hire. Choose the smallest car that can take all your luggage in the boot (trunk). If there are more than two of you and you’ll be doing a lot of driving, look for a compact or mid-sized car for better comfort levels.

Should you hire a car from the airport?

Portugal’s major international airports in Lisbon, Porto, Faro, Madeira and the Azores islands all have car hire companies on site or a short shuttle bus away. You’ll get more choice and usually better deals with airport rentals than in-city locations.

That said, I would avoid driving in Lisbon and Porto if at all possible. The public transport systems in both cities, coupled with cheap taxis, mean that having a car during your stay is unnecessary and is likely to be more of a headache than anything else. Parking is problematic, one way systems and signage can be confusing and local drivers have little patience, especially at rush hour.

Other cities are not so bad and if you have a GPS navigation system and accommodation with parking, having a car should not be a problem and will give you the freedom to explore further afield.

My advice: Plan to spend car-free days in Lisbon or Porto at the beginning/end of your trip then take public transport (or a taxi) to or from the airport/Prior Velho (the off-site location for many car rental companies) when you collect or drop off your hire car.

Possible extra charges when you hire a car in Portugal

Renting a car in Portugal using an online comparison and booking system such as Discovercars.com or Rentalcars.com is easy and generally reliable but make sure you read the terms and conditions carefully to avoid unexpected charges. You don’t want to end up in an argument with the rental company before you’ve even begun your holiday.

Car hire firms employ various methods to bump up their profits but savvy travellers can easily keep these extra costs to a minimum.

Excess waiver insurance

The additional fee I hate most of all is the collision damage waiver (CDW). All car rentals include compulsory vehicle insurance but there is usually a relatively small amount that isn’t covered. In practice, this means that if you have a bump that requires repairs, you’ll have to pay the first €1,000 (or whatever the ‘excess’ or waiver amount is) even if it wasn’t your fault.

If you’ve managed to bag a bargain on the car hire, the extra fee for insuring this relatively small amount could be almost as much as the cost of renting the car! Talk about extortionate.

Rental firms have you over a barrel once you get to their office. You either pay up or take your chances and spend the rest of your holiday fretting about scratches and dents caused by other drivers.

How to get around this sneaky fee: Plan ahead and take out a standalone excess waiver insurance policy that covers you for multiple rentals within a given period. CDW insurance may already be part of your credit card or other policy coverage so check to see whether any of your existing insurance policies cover you.

Important tip: Make sure you have enough available credit on your credit card to cover the excess as the car rental company will place a hold on your card to the value of the excess until you return the car even if you have separate insurance to cover this. If you have an accident, the rental company will take the money from your credit card and you will have to claim this back from your insurer.

Check the rental terms to find out how much this ‘hold’ will be will be before you leave home and contact your credit card company to arrange an increased limit if necessary. We got caught out by this one time in the UK and because the hold value was abnormally high, i.e. more than Mike’s credit limit, we were forced to take the extra insurance, which cost more than the actual car hire!

Another important tip: Don’t skimp on the inspection. Check that every existing scratch and dent is recorded by the company before you drive off. If possible check for damage in daylight. Ideally, arrange to drop the car off during office hours so you can get them to sign off when you return it. Take photos or a video of the car if you notice any damage.

Fuel fees

When you collect your rental car, it should have a full tank of fuel. The rental company should give you the option of returning it full or empty, in theory to save the time and stress of having to find a petrol station before dropping the car off.

If you choose full-empty, you will inevitably be giving the car hire company free fuel as you won’t want to risk running out of petrol.

How to avoid wasting your money: Make sure you opt for full-full, meaning you only pay for the petrol or diesel you actually use. You can usually filter your search for this option.

Paying for toll roads in Portugal

Almost all Portuguese motorways are now subject to toll fees. Some of them, such as the A1 between Lisbon and Porto, have toll booths where you can simply pay as you go.

Others (known as former SCUT roads) used to be free but the government decided to install electronic tolls and a ridiculous system for collecting fees which has undoubtedly caused more problems than it solved.

What this means for you is that you will either need to meticulously plan your route to avoid passing through any of these electronic tolls (not advisable) or decide how you are going to pay for them.

All car rental companies must offer you the use of an electronic device that registers any toll fees you incur while driving a Portuguese-plated car in Portugal. This is one piece of equipment I think is worth paying for – it should only cost about €1.50 to €2 per day, capped at about €20.

You can opt to prepay your tolls with the rental company, which may mean that you pay a little more than you actually use but for the convenience, it’s worth considering.

The other options are for them to collect the toll fees from your credit card after your trip is over (this is what I would do) or pay the fees yourself at a post office. This manual payment method is complicated by the fact that the post office system takes 2 days to register your tolls so if you are leaving the country within two working days of driving through your last toll, you can’t pay in person.

Tip: If you are using the electronic device, you can also drive through the green Via Verde lanes at the traditional toll booths instead of paying on the spot. This saves you time as you don’t have to stop the car and means you can pay for all your tolls using the same method.

More information about the toll system, including rates and locations, is available on portugaltolls.com

Satnav and GPS

I strongly recommend using some form of GPS navigation system to help you drive around Portugal. You should also have a good paper road map of Portugalwith you for backup and so you can easily see the bigger picture if heading off the beaten track.

Many modern car models have GPS as standard but not all. Car hire companies charge a lot for renting GPS systems, sometimes as much as €15 per day, although there is usually a cap of around €80. Always check before agreeing to rent one.

How to get around this additional cost: If you have a sat nav device at home, you may find it more economical to download a Europe map and bring your device with you. And, of course, you will be used to it’s functions!

Or, if you have access to 3G wifi, use a navigation app like Google Maps on your smartphone or tablet. This is what I do, although there is sometimes a delay or even drop out in the GPS signal so download the maps for offline use before you set off if possible.

Waze is apparently good for driving in busy cities such as Lisbon and Porto.

It’s much easier when there are two of you in the car, one driving and one navigating with technology and old school maps.

Additional driver charges

Some car rental deals include an extra driver. This is not standard and most companies will charge for additional drivers on a daily basis. The rate varies but is usually in the €7-10 range.

What you can do about this: Decide beforehand whether or not you will need more than one driver. If so, take this into account when comparing rental deals between companies. If you can’t get a deal that has a free extra driver, some hire firms will allow you to pay for specific days, e.g. if you are renting a car for 7 days but will only need a different driver on 2 of them, just pay for those periods.

Young drivers

You have to be over 18 to hire a car in Portugal and some companies won’t even consider anyone under 21 (or even 30 for some models of car!). Check age restrictions carefully before choosing your company. I believe all of them charge an additional Young Driver fee for anyone under 25. This usually ranges from €6-10 per day.

What can you do? If at all possible, make sure your driver is over 25 to get a cheaper car. Otherwise, you’ll need to do some serious shopping around to avoid paying more than is absolutely necessary.

Child safety seats

If you’re travelling with children under the age of 12 or shorter than 135 cm, they’ll need a car seat. If you need to hire one, it can cost up to €10 per day per seat. 

How to reduce the cost: It may be worth paying your airline’s extra baggage fees to bring your own car seat(s) with you. If all you need is a booster seat, they can be bought very cheaply at major supermarkets, although that only helps if you are not collecting your car from the airport on arrival.

Cancellation fees

Some companies, including Rentalcars.com, and Discovercars.com offer free cancellation and amendments up to 48 hours before the date of hire while others are far less lenient.

Always check the small print for the cancellation policy before you book.

Cross-border fees

Just because Spain and Portugal share a border, that doesn’t mean you can freely drive between the two countries. You must let the rental company know in advance so that they can deal with the insurance and any other requirements. There will be a cross-border fee, which ranges from €40 to €80.

Avoid surprises by checking the ‘Extra Services (payable at counter)’ section of the rental terms (with Rentalcars) and consider whether it’s really necessary/worth it to drive into another country.

What if there’s a problem?

If you have booked your rental car through a vendor such as Rentalcars.com or Discovercars.com and are hit with unexpected fees or anything that doesn’t match your agreement when you pick up the vehicle, contact the company you made the booking with before signing for and taking the car. This will give them the chance to mediate if necessary and resolve the situation. 

You may also like these:

Top tips on your first trip to Portugal.

The N2-The ultimate Portugal road trip.

Day trips from Porto.

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  1. Julie, Just to expand on your worthy advice over rental car insurance extras, and whilst I am aware that you probably shy away from mentioning any particular rental companies for commercial reasons, the last time I looked up this subject, certain **local** shiny car rental compani(es) absolutely refused to accept any form of insurance cover pre-arranged with a third party company (I am trying to avoid saying ‘third party insurance’ as that would introduce great confusion!) – at the pick-up desk they insisted no-matter-what on the renter taking out and paying then and there for their own insurers’ cover before they would hand over the key. The reason for this was cited as being to do with selling commissions to the renting company – and presumably onward in some part to their employees – for such insurance. By the way, CDW is also referred to as ‘excess’ in (British) english, ‘deductible’in (US) english I believe, and as ‘franchise’ in French – I’ll leave your readers to make their own enquiries as to the Portuguese word, but it may be worthwhile arming themselves with it! Watch out also for Personal Injury nsurance, Theft of Own Property insurance, etc., etc., anything some companies can think of to make you pay more wherever you may be!
    In the end I decided to drive my own car the whole way there from northern France, but using the French SNCF Autotrain service between Paris Bercy station/gare and Biarritz. That saved a reasonable amount of fuel, fatigue and autoroute tolls across France, but it is not very joined up as you then have to totally separately take a pretty slow and rather ancient, overnight sleeper passenger train from the nearby Gare d’Austerlitz across the River Seine and meet your car at Biarritz station the following morning, and vice-versa

    Whilst I also use AutoEurope from time to time, they do not necessarily include all possibilities, particularly the smaller local renting companies, and of course, whatever you may end up reserving in advance, there remains the risk of additional advance charges being forced upon you at the pick-up desk, where you bargaining power really is almost zero and it is take it or leave it. Without wishing to cause offence, I did also read a press survey some time ago that concluded that Portugal was THE most expensive country in Europe for renting cars. So all of your advice is well worth noting in order to keep the costs down to a relatively acceptable level, and without nasty surprises, compared to elsewhere across Europe, and booking very early would be a good start.

    For anyone driving into Portugal from Spain, I can further advise that there are **some** fully automated facilities on newer Portuguese motorways, in my case I entered NE Portugal from Spain on the Spanish A-75 / Portuguese A24 at Feces de Abaixo, where about 1-2km inside the border there was a layby where you pull up to a gantry camera, then get out to operate the adjacent credit card machine, enter your card number and some other details, the machine takes a photo of the number plate, and once complete, the machine issues you with a receipt confirming that you can travel on any of the auto-toll motorways and the tolls will be auto-debited from your bank account as you go, for a maximum overall period of 30 days. I don’t remember if it’s renewable/extendable, presumably it will be on their website that you mention. It may also give more locations for these facilities, which did work without any hitch I have to say, althought the list of 1/2/3/4/…€ debits on the bank statement back home was rather long!

    Keep Up the Good Work,
    John H

    1. Hi John, Thanks for your detailed and useful addition to my tips for renting a car here. I know that there is always compulsory insurance, which includes personal liability cover, included in the rental fee but they can’t insist that you take out the CDW insurance, or at least that’s never happened to me and I never pay for it – it’s a rip off.

      I have also learned the hard way that the cheapest option isn’t always the best (or even the cheapest in the long run) so I tend to stick to brands I recognise when I see the results from search engines.

  2. Hello Julie, Very informative detail. I’m from the U.S. Where do I find stand alone insurance policies?

    1. Hi Dorothy, If you Google it, you should find a few options that are relevant for US citizens.

  3. hi julie, we would like to rent a car at porto airport and drive to braga, bom jesus, citania de briteiros and then up to geres national park. is it safe to leave our luggage in the car during the day while we visit these sites?

    1. Hi Silvia, As long it’s safely locked out of sight in the boot, you should be fine. Try to park in a secure spot in Braga and Bom Jesus just to be on the safe side.

  4. What do you think of the idea of renting the car from a smaller town, such as Guimaraes or Braga, and avoiding the traffic in Lisbon or Porto? We will be exploring the northern areas, and thinking we could simply take the train or bus to a smaller place, rent the car then return it when we’re heading back for city activities. Does that make sense? Or is it easy enough to rent at Porto airport and drive directly out of town?

    We live in a small town, not very accustomed to rushed or heavy traffic. Thanks for your wonderful information pages.

    1. Author

      Hi Karen, Porto airport is north of the city so you could hire from there and get straight on the motorway to go further north. You’ll probably get a better price if you hire from there but compare with hiring from Braga/Guimarães to be sure. One thing to mention is that both of these are also fairly large cities and Braga’s ring road is frustrating to say the least!

  5. What do you think of the idea of renting a car in a smaller town, like Guimaraes or Braga, for exploring the northern areas? This way we could avoid driving out of Lisbon or Porto, or even around Coimbra, all places we want to visit. We could just train into one of those places and return to Porto by train at the end. Does that make sense? Or is it easy enough to simply rent at Porto airport when leaving town?

    I am enjoying your pages, very helpful for planning – and dreaming!

  6. Some of the credit card companies still offer collision caover age for up to 30 day rentals BUT it ONLY covers the rental car, not other cards or liability.

  7. Some of the credit card companies 9e.g., for me American Express and Citibank) still offer collision coverage BUT it covers ONLY the rental car, not other cars or liability.

  8. Hi Julie,

    I already rented a car for my upcoming vacation to Portugal but I was just reading the car rental company requires an International Driver’s license. I’ve rented cars in Europe before (Italy, Spain, France) and I’ve never needed that. Is it mandatory in Portugal? I have a driver’s license issued in Colorado, USA.


    Kind Regards,


    1. Author

      Hi Adriana, you’d need to confirm that with the car rental company, I’m afraid.

  9. Hi Julia, very informative site u have here. I do however have a question. I’m actually driving down there from the UK so I wanted to know if whether using Google maps or Waze and selecting avoid road tolls on the app menu will make me dodge the roll roads. Or maybe I have no option but to use the toll roads. Also I wanted to know where I can buy a transponder from when I get into Portugal from spain? Thanks for your advice and information. Greatly appreciated.?

    1. Author

      Hi Seraj, you should find the answers to your questions and a route planner to help you avoid tolls on this site http://www.portugaltolls.com/, athough you can select ‘avoid tolls’ on Google Maps too.

    2. Seraj, we’re just back from a 5 day family trip from Algarve, drove over 1000 kilometers and been using the A22 a lot. Google maps did work fine in avoiding tolled roads, still tries to put your route thru the highest ranked road possible (the wider ,the better quality, etc.. and sometimes nearly as fast as the paid motorways).

      Only downside I’ve experienced is when sudden route changes occurred. Re-planning happens in an instance but on 3 occasion (that I can recall 3 days after the return) the darn thing wanted me to leave the main road and drive on macadam road with tons of serpentine for 5km… this happened twice around Mnt. Foia near Monchique. One was scary enough as it was a serpentine road already and due to a Beligian cycle team training for maybe the Tour, in the tick fog you could barely see a thing, then in an instance turn right, said the voice in the head… I had to pull over, stop the car, close Gmaps and launch CoPilot to get it right towards to Aljezur

      Gmaps is free, you can download offline maps with ease, so you’re good to go even if there’s no 3G/LTE, but there’s still good gps/glonass coverage. However..not sure what system you’re on (Android, IOS, BB, Win) but i.e. on PlayStore there are some proven, decent offline navigation apps with a 7 day trial, 7 days meant (the last time) is you’re still on the trial period, but whatever countries/regions map you’ve downloaded did work! Friend been using this when he visited us and done the Ring of Kerry 🙂 Give a try to Ndrive, Sygic, copilot, just to name a few

      One important thing though, if savvy traveler wants to use a smartphone for navigation. Make sure to invest in a decent car charger with at least 2amps output , and good quality charging cable…(and some kind of suction holder). There’s nothing more annoying when an app gets stuck in the background and drains ur battery while you need the phone/navigation the most 🙂


  10. Hello Julia,
    I am beginning the process to rent a car with AutoEurope through your website.
    Is Rhodium a reliable car rental company?
    Thanks in advance for your answer.

    1. Author

      Hi Cesar, I’m afraid I have no personal knowledge of or experience of Rhodium so I can’t say one way or another, other than to have faith in the partners that AutoEurope choose to work with.

  11. Having driven hire cars in many, many countries throughout the world I absolutely agree with all your tips. I find the whole electronic toll thing the hardest thing about rental cars, although it is getting easier now that electronic tolls are so much more common and rental companies more universally offer electronic toll tags.

    1. Author

      Hi Lyn, in Portugal, at least, it’s a legal requirement for rental companies to make the electronic devices available to clients if they want to use this option.

  12. Hi Julia,
    Excellent post. Very helpful indeed. I will most probably rent with autoeurope through your website.

    1. Author

      Thanks, César. Happy to have helped.

  13. We often rent cars when we’re in Europe, we find it convenient for visiting smaller towns that are off the train routes. Thanks for the great tips, I’m sure they will help many.

    1. Author

      Thanks, Nathalie. Many of the places I have written about on my blog are difficult if not impossible to get to without a car so I thought it was about time I put together a useful guide for hiring a car in Portugal. Public transport is great but it only takes you so far. I love the freedom of having my own wheels.

  14. Julie, I can honestly say that this is one of the most comprehensive and useful posts I’ve read!!! I did pretty much all of these things before we visited, but it was a process that took me tons of time to research eall of the bits and pieces. (When I found out about those excess insurance standalone policiesI was thrilled!!!) Well done!

    1. Author

      Thanks Jane! Praise indeed 🙂 I agree about those standalone policies – a great way of avoiding those ridiculous fees. I used to take the risk but I’d feel happier with some cover, as long as it’s reasonably priced.

  15. Great tips and you covered any questions that I could think of, Julie. We rented a car for 3 months this winter in Lagos and found the low season prices and insurance to be a pretty good deal – about 340€ per month – which I’m assuming triples during the high season. From conversations we’ve had with other friends, one of the real “hidden” charges might be renting a GPS as we heard the figure 10€ per day quoted which is extortionate. We brought our own GPS (Tom-Tom) from the US and bought a larger size memory card to load both US and European maps on it. So much more economical and we never leave home without it! Anita P.S. Loved your posts on the Way of Saint James – I’ll be contacting you at some point to discuss this!

    1. Author

      Hi Anita, that’s a great tip about the extra memory card for the GPS. I was shocked at how expensive they are to rent.

      As for the Way of St. James, there’s more to come, and please do come to me if you have questions.

  16. i might be going to Portugal so I was interested in how driving there would be different from France where I visit frequently. Most interesting was the prepayment to pay the tolls. I just always assumed I could pay at the toll booth with cash or credit.

    1. Sadly it’s no longer that simple, although the rental companies have ways of making it painless for you so no need to stress but something to be aware of.

  17. Before renting any car in the U.S. or Europe, I always take photos of the outside and inside. Also make note of any scratches, damages – and ask the rental agent to also note any damages found and to give me a signed copy. Otherwise you may be charged for damages not noted when you return the car.

    1. Author

      Good idea, Arline. My husband got stung once in the UK and we are super cautious now. We get everything signed off but haven’t gone as far as photos.

      1. Even better is to take a video of the car before and after.

  18. Last year we rented a car at Lisbon airport and returned it there… it was super easy.

    1. Author

      Good to hear. I like the fact that when you’re coming to Lisbon airport via the A1 motorway, it’s so easy to access.

  19. I do not tip anyone at the car rentals in either Europe or the U.S. – nor have I ever had anyone appear to expect a tip.

    1. Author

      Tip in this context = advice, useful information, not money for services 🙂

  20. Hi Julie – is it safe for two single, 60 year old, women to drive alone in Portugal (and Spain)?

    1. Author

      Absolutely, as long as you’re fit to drive 😀

Over to you. Please share your thoughts in a comment.