A breakdown of the pros and cons of each type of vehicle for different travelers.
Car Rental Tips

Renting a Manual or Automatic Car in Iceland

24.02.2025

Iceland offers breathtaking landscapes, from black sand beaches to volcanic craters, but exploring these hidden gems requires access to a reliable vehicle. If you’re planning a trip to this spectacular country, deciding between a manual or automatic car is a crucial step in ensuring a safe and enjoyable experience. Renting a car suitable for Iceland's unique conditions and your driving abilities can significantly impact your road trip.

This guide will outline the key differences, pros, and cons of manual and automatic cars to help you make an informed choice. Whether you're an experienced manual driver or prefer the simplicity of automatics, we’ve got everything you need to know.

Why Choosing the Right Transmission Matters in Iceland

Driving in Iceland isn’t your typical road experience. Its landscapes are as rugged as they are mesmerizing, with roads varying from smooth highways to gravel paths and highland tracks. Your choice between a manual or automatic car will depend on factors such as:

  • Comfort with Driving Manual vehicles require gear changes, which can be challenging for less-experienced drivers, especially on Iceland’s winding routes.
  • Planned Destinations Some areas, such as the highlands, demand vehicles capable of handling rough terrain.
  • Budget Rental costs and fuel efficiency differ based on transmission type.

By the end of this guide, you’ll have a clear idea of which vehicle is better suited for your Icelandic adventure.

Why Choose a Manual Car in Iceland

Manual transmission

Pros of Manual Cars

  1. Cost-Effective

Manual cars are often less expensive to rent than automatic ones, making them a budget-friendly option for your trip.

  1. Fuel Efficiency

Manual vehicles are generally more fuel-efficient, which is beneficial given Iceland’s high fuel prices.

  1. Greater Control

Driving a manual car offers enhanced control, especially useful when navigating gravel roads and steep inclines commonly found in the countryside.

Cons of Manual Cars

  1. Steeper Learning Curve

If you’re unfamiliar with driving a manual, Iceland’s unique road conditions could make this a stressful option.

  1. Tiring in Traffic

Manual transmissions require constant gear shifting, which might become tedious in Reykjavik or other busy areas.

  1. Weather Challenges

Icelandic weather can change quickly, requiring swift adjustments to maintain control. This might be more difficult for drivers inexperienced with manual transmissions.

A manual car is an excellent choice for travelers confident in handling this transmission, particularly those aiming to stay within budget while traveling across diverse terrains.

Why Choose an Automatic Car in Iceland

Automatic transmission

Pros of Automatic Cars

  1. Ease of Use

Automatic vehicles are simple to operate, making them ideal for drivers who value convenience and minimal distractions.

  1. Stress-Free Driving

Shifting gears automatically allows you to focus on navigating Iceland’s stunning but challenging roads.

  1. Comfort in City and Off-Road Conditions

Whether you’re cruising through Reykjavik or exploring F-road trails, automatics provide a comfortable experience.

Cons of Automatic Cars

  1. Higher Rental Costs

Automatic cars generally come with a higher rental price tag than manual vehicles.

  1. Slightly More Fuel Consumption

While some modern automatics are fuel-efficient, older models might consume more fuel compared to manual cars.

  1. Limited Control on Gravel Roads

Drivers might feel less vehicle control in off-road conditions, though this is rarely an issue in standard driving scenarios.

If convenience and comfort top your priorities, an automatic car is the way to go, especially for travelers less confident with manual transmission.

Skoda Octavia Combi Near Godafoss in North Iceland

How to Decide Based on Your Travel Plans

When choosing between a manual and an automatic car for your Iceland trip, consider the following factors:

Your Experience

If you’re accustomed to driving a manual, you might feel comfortable opting for one. For those who rarely use manuals, automatics provide a hassle-free solution.

The Terrain

Planning on exploring Iceland’s highlands? You’ll want a 4x4 vehicle that can withstand tougher terrain. Many 4x4s come in both manual and automatic options, so choose based on your familiarity.

Your Budget

Manual cars typically have a lower rental rate, helping you save money on your trip. However, automatics are widely available and worth the extra cost for added convenience.

Weather Conditions

Iceland’s unpredictable weather can make driving challenging, especially during the winter. Automatics might provide greater comfort in variable conditions, enabling you to focus on the road.

Volkswagen Electric Car in Downtown Reykjavik Iceland

Frequently Asked Questions

Do I need a 4x4 in Iceland?

If you’re venturing into the highlands or F-roads, a 4x4 vehicle is mandatory. For city drives or main roads like the Ring Road, a 2WD might suffice.

Are automatic cars more expensive to rent?

Yes, automatics usually have higher rental costs, but they offer simplicity and comfort.

Are manual cars hard to drive in Iceland?

Manual cars require gear handling, which can be tricky for those unfamiliar or in challenging conditions like gravel or icy roads.

Can I drive any car on F-roads in Iceland?

No. Only 4x4 vehicles are permitted on F-roads, which are rugged and remote highland trails.

Is fuel expensive in Iceland?

Yes. Fuel prices in Iceland are among the highest in Europe, making fuel-efficient choices important.

Can I rent an electric car in Iceland?

Yes, electric cars are an option, especially for environmentally conscious travelers. However, charging stations may be limited in rural areas.

Is it safe to drive in Iceland during the winter?

Yes, but you’ll need to be extra cautious. Winter tyres come standard at no extra cost and 4x4 vehicles are strongly recommended.

Can I pick up a rental car at Keflavik Airport?

Yes, Höldur Car Rental offers convenient pick-up and return services at Keflavik International Airport. We are proud to be one of only three car rental companies with a dedicated desk inside Keflavik Airport. Conveniently situated in the arrivals hall, you'll find our desk on the left, just after clearing Customs.

Should I get additional insurance?

We highly recommend choosing our Medium or Premium Protection Packages for a safer driving experience in Iceland. Learn more by visiting our Guide to Vehicle Protection.

How early should I book my rental car?

It’s best to book as early as possible, especially during peak travel seasons, to secure your preferred vehicle.

Map of europcar locations in Iceland

When you book with Holdur Car Rental you´ll get:

  • Our Basic Protection Package. This includes third-party loss.
  • Collision damage waiver (CDW)
  • Personal Accident Insurance (PAI)
  • The option to upgrade your vehicle cover
  • -5 ISK Fuel Discount off every liter at N1 gas stations
  • Studded Winter Tyres during the snowy season at no additional cost
  • Flexible cancellation, with a 100% up to 48 hours prior to pick-up

Plan Your Iceland Road Trip Today

Exploring Iceland by car is an experience like no other. To make the most of your trip, choose a rental vehicle that aligns with your driving skills, travel plans, and preferences. Höldur offers a diverse selection of manual and automatic rental cars, from budget-friendly options to 4x4 SUVs tailored for Iceland’s rugged landscapes.

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