We will rent a car in Auckland and tour both the north and south islands. Which is cheaper, ferry car plus two seniors, Wellington to Picton, or drop car in Wellington, two seniors fly to Nelson, and rerent car in Nelson?

I'll admit it has been 10 years or so since we did a similar trip, but I recall that our car rental agreement prohibited us from taking the rental car on the ferry. We visited the South Island first, dropped the car off in Picton and re-rented in Wellington. That might be another option for you.

I am traveling in December, and touring both Islands as well, found a flight for $69.00 on Jet Star airlines. Way cheaper than car and ferry, ferry alone was $165.00. You should check them out just google jet star airlines.

We rented our car from Apex in 2009-2010, which included the ferry fare for the car. We paid for our tickets. I liked it because we could keep all our luggage in the car and didn't have to go through the hassle of carrying our luggage on the boat and picking up another rental car. We just drove off the ferry and continued on our way. Also enjoyed going through the Sound, which was quite nice.

I just checked the ferry rates - $228 plus car and two seniors, $98 for two seniors, no car.

http://www.interislander.co.nz/

You'll need to research flights and make a comparision. Keep in mind the ferry crossing takes about 2.5-3 hours.

Look for Smartsaver fares on Air NZ also.

I don't know where you want to rent your car, but you might ask the rental company if they have some cheap offers for the ferry. Apart from the price the trip with the ferry itself is stunning, you get a great impression of the sounds while traveling to Picton, and we saw a lot of dolphins on the way and also some seals.