Market Trends of Car Rental Industry
Increasing Demand for Online Car Rental Services to Play a Key Role in the Market
Increased adoption of information technology is transforming the car rental industry and enabling operators to deliver improved services to their customers. This includes the utilization of optimized corporate and customer information management and the development of convenient internet booking applications.
The online booking model is at the forefront of identifying applications for beacons and near-field communications (NFC). Newer players, like Zipcar and BlaBlaCar, are benefiting from using innovative business models such as car-sharing and adopting technologies such as telematics. Uber and Lyft are using mobile technologies and devices to better meet consumers' personal transportation needs. These initiatives are contributing to the disruption of the car rental industry.
Further, online booking also serves a variety of purposes, such as verification of documents of the renter, offering information to the renter regarding the car, services like drop and pick-up of the rented car at a certain place, e-signing contracts, and cashless transactions. Additionally, the rising dependence of users on smartphones to carry out a variety of activities traditionally done by personal computers has significantly helped transform the car rental experience for customers.
Rental companies, such as Enterprise a Car and Europ Car, have also strengthened their position in the sector by expanding their operation of vehicle rental services in Spain's tourist airport. Though key companies have a strong presence in the country, they have not adopted the latest developments or active strategies, so the van rental market is witnessing slow demand.
This is further enhanced by the increased availability of comprehensive demand-oriented mobility solutions. Industry players such as Sixt SE, Uber, and Avis have launched their mobile apps, which allow customers to easily choose vehicles from a portfolio and carry out bookings.
North America is Expected to Remain the Largest Market
North America is expected to retain its dominance in the market between 2024 and 2029. The rising number of leisure and business trips across the region, both locally and internationally, is among the prominent factors influencing the growth of the regional market.
Further, a continuous shift in consumer preference toward rental services and the presence of prominent service providers in the region, like Avis Budget Group and Enterprise Rent-a-Car, are expected to accelerate the revenue generation prospects. Recently, the usage of these services increased in several cities, fueled by increased initiatives by service operators. For instance,
In June 2023, Uber Technologies Inc. disclosed its plan to bring Turo-like peer-to-peer car rental to North America. Customers will be able to rent by the hour or the day and can drop off the rented vehicle wherever it was picked up.
In addition, the rising adoption of electric cars and growing concerns and awareness of lower emissions among consumers in the region are some of the major factors fueling the market. Moreover, over 70% of Americans prefer to rent an EV as a way to test drive the technology before investing in it.
All these factors combined are expected to provide a boost to the positive market growth of the region between 2024 and 2029.
