CAR RENTAL MARKET ANALYSIS

The Global Car Rental Market is projected to reach around US$ 361.6 Billion by the end of 2030, in terms of revenue, growing at a CAGR of 15% during the forecast period (2023-2030).

Global Car Rental Market: Growth Drivers

• Transfer to online bookings: The growth of the global car rental market is driven by the significant advantage of convenient online booking services. This trend can be attributed to the widespread use of smartphones and the increasing internet usage worldwide. Furthermore, online booking platforms also provide attractive discounts and offers, contributing to the overall expansion of the global car rental market.
• Economic progress in developing countries: The global car rental market is poised for growth due to the rapid GDP expansion in developing countries. This economic progress is expected to boost the consumer spending power, coupled with increased disposable income, is expected to contribute to the market growth of car rental services. According to India Brand Equity Foundation, India overtook the U.K. to take over as the fifth-largest economy in the first quarter of FY 2022-23. Currently, the real GDP in the first quarter of 2022-23 is around 4% greater than the equivalent quarter in 2019-20.

Global Car Rental Market: Restraints

• Cheaper rates of public transportation: The affordable fares of public transportation options like buses and trains compared to the cost of car rentals, may present challenges to the growth of the global car rental market.  According to the Coherent Market Insights analysis, the average cost of a taxi in Los Angeles, North America is US$ 1.80/km and that of a bus is US$ 1.50/km.
• Rapid change in price of crude oil: Fluctuating prices of crude oil due to the gap between demand and supply is projected to restrict the growth of the global car rental market over the forecast period. Companies are switching from traditional rental cars to electronic rental cars in order to solve the problem by collaborating with other businesses and building an infrastructure for electric vehicles.

Global Car Rental Market: Opportunity

• Increasing improvement in road infrastructure: Improved road infrastructure across emerging economies and the rising number of leisure and business trips are projected to provide potential opportunities to the global car rental market. According to India Brand Equity Foundation 2021, The Indian government has planned to build roads extending 313 km for Rs. 11,000 crore (US$ 1.48 billion) to transform the road infrastructure in Punjab, Haryana, and Rajasthan. The growing adoption of information technology across the industry in order to deliver efficient services and strengthening their regional as well as global presence is projected to shape the market growth over the forecast period.

Global Car Rental Market: Trends

• Introduction of mobile apps for car renting facilities: Various industry players are introducing mobile apps for customers in order to ease the booking process and allow consumers to choose the vehicle of their choice from the portfolio. For instance, in August 2021, the well-known e-mopeds made by partner TIER are now a part of SIXT share, a global mobility service. Users of the SIXT app in Berlin, Cologne, Hamburg, and Munich can access the brand's about 3,500 e-mopeds in addition to the thousands of TIER e-scooters. The rising trend of sharing cars among consumers is expected to bolster the global car rental market.

Global Car Rental Market: Key Developments

• In May 2023, Hertz (American Car Rental Company) and the City of Orlando (provides public services launched Hertz Electrifies Orlando, a partnership to accelerate electric vehicle adoption, expand EV rentals and charging infrastructure, and provide education and training opportunities
• In February 2023, Sixt SE (offers vehicle rental services to corporate and individual consumers) inaugurated a new branch at Toronto Pearson International Airport (YYZ) by providing premium car rentals. Sixt is strategically expanding in North America following the establishment of a branch in Vancouver, Canada.
• In March 2021, Europcar Mobility Group (provider of integrated mobility services) announced the continuation of its strategic alliances with ECO Rent a Car in India and Shouqi Car Rental in China, specifically for its Europcar brand.
• In July 2022, The delisting of the company's shares and the implementation of a squeeze-out procedure for Europcar Mobility Group shares at a cost of €0.51 per share have been requested by Green Mobility Holding S.A., a bidder consortium made up of Volkswagen, Attestor, and Pon Holdings.

Global Car Rental Market: Market Segmentation

Global Car Rental Market Share (%) in terms of Value, By Region, in 2022

The North America region dominated the global car rental market in 2022, accounting for a 40% share in terms of value, followed by Asia Pacific and Europe, respectively. Rapid growth in the number of leisure and business trips locally and internationally drives the North America market.

Figure 1: Global Car Rental Market Share (%) in terms of Value, By Region, in 2022

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Global Car Rental Market: By Car Type

On the basis of application, in 2022, the economy cars section accounted for the largest market share of 31% in terms of value, followed by executive cars and luxury cars.

Figure 2: Global Car Rental Market Share (%) in terms of Value, By Car Type, in 2022

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Global Car Rental Market: Impact of Coronavirus (COVID-19) Pandemic

Companies all over the world are increasingly requesting that employees work from home, which has reduced commuting in cities and caused a sharp decline in transportation during the pandemic situation. It is anticipated that this situation will continue to lower demand for car rental services all over the world. For instance, Hertz Global Holdings Inc., an American car rental company, faced soaring cancellations and lack of new bookings. The company has been cutting off staff and reducing high capital spending to reserve liquidity.

Global Car Rental Market: Key Companies

The key companies operating in the global car rental market are Enterprise Holdings, The Hertz Corporation, Avis Budget Group, Europcar Group, Carzonrent, Sixt SE, Al Futtaim Group, Localiza - Rent a Car, Eco Rent a Car, and GlobalCARS.

Definition: A car rental service is a company that arranges for customers to rent cars at reasonable prices. Typically, this agency is situated close to busy city centers and airports. People who need a car temporarily typically choose car rental services. Additionally, those who own damaged cars and are looking for repairs or insurance compensation could also find car rental services to be ideal. Additionally, car rental services offer extra advantages like child safety seats, entertainment systems, portable Wi-Fi, and navigation systems.