Car rental market overview
The trends highlight that the car rental market accounted for USD 92.02 billion in 2021, and it is expected to reach USD 139.65 billion, projecting a CAGR of more than 7% during the forecast period. The trends highlight the rising need of car rental market in the global scenario and hence, will add to the market share in the market.
The COVID-19 pandemic outbreak has devastated economies worldwide, and the impact was felt by businesses across verticals and hit transportation services particularly hard. Some challenges that emerged from the worldwide lockdown are immense and impossible in many areas. With reduced global air traffic, the demand for rental cars has slowed down at airports as there were travel restrictions worldwide to contain the spread of the virus. Also, the rising prices of petrol and diesel in developing countries are likely to hamper the market's growth during the forecast period.
The global crisis has merely accelerated the adoption of rental cars worldwide. However, post-pandemic practices for disinfecting cars are followed meticulously, with safety and hygiene becoming the need of the hour. The need for individual mobility and social distancing norms is bound to improve industry conditions.
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Renting a car provides unparalleled convenience and flexibility for travelers and locals alike. Whether for a business trip, a vacation, or simply to replace a vehicle temporarily, the option to rent a car offers numerous benefits. Car rental agencies offer a wide variety of vehicles to suit different needs, from compact cars for city driving to spacious SUVs for family trips. When you rent a car, you gain the freedom to explore new destinations at your own pace without relying on public transportation schedules. Additionally, the cost of maintenance and insurance is typically included in the rental agreement, making it a hassle-free option for many.
The demand to rent a car has surged with the growth of tourism and business travel. Car rental companies have responded by enhancing their services, providing more options, and implementing user-friendly booking systems. Whether you need to rent a car for a day, a week, or longer, the process is straightforward and can often be completed online or via a mobile app. Many people prefer to rent a car for the convenience of picking up and dropping off at different locations, adding to the flexibility of their travel plans. As a result, choosing to rent a car has become an essential service in the travel industry, ensuring that individuals and families can travel comfortably and efficiently.
Market segmentation
The car rental market is segmented by booking type, that is, offline access and online access, based on the application type and includes leisure/tourism and business, vehicle type segmentation that includes luxury/premium car and economy/budget cars, followed by the end-user that includes self-driven and chauffeur-driven cars. The market segments further extend to rental length, including short term and long term, and geography of North America, Europe, Asia-Pacific, South America, and Africa.
Regional analysis
The market in the Asia-Pacific region is expected to register significant growth in terms of CAGR over the forecast period, owing to increasing travel and tourism and increasing availability of high-end luxury and economy vehicles, especially across developing countries. The North American region led the overall market in 2019, and it is expected to retain its dominance over the forecast period. The rising number of leisure and business trips across the region, both locally and internationally, is among the prominent factors influencing the regional market's growth. Additionally, there has been a continuous shift in consumer preference toward rental services followed by the presence of prominent service providers in the region, like Avis Budget Group and Enterprise Rent-a-Car, are expected to accelerate revenue generation prospects.
North America is expected to be the largest car rental market globally during the forecast period, as the United States remains the largest country for car rental services. For instance, Uber Technologies Inc. adopted mobile technologies and other devices to more efficiently meet consumers' transportation requirements.
Industry news
Technology is a critical component that is expected to boost the market over the forecast period. It includes the utilization of optimized corporate and customer information management and the development of convenient internet booking applications.
Newer players, like Zipcar and BlaBlaCar, benefit from using innovative business models such as car-sharing and adopting technologies such as telematics. Uber and Lyft use mobile technologies and devices to meet consumers' personal transportation needs better.
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