Market Trends of Indonesia Car Rental Industry
This section covers the major market trends shaping the Indonesia Car Rental Market according to our research experts:
Growing Demand for Online Car Rental Services
An increasing number of smartphone-based online rental car booking apps are being used, significantly boosting the market growth.
Online booking services include booking cars through internet sites and mobile applications, among which renters opting for booking-via-sites is the most common method. The rise in internet users across the country is likely to increase the online booking services use. For instance, in 2021, internet users witnessed around 77.1% of the total country's population, which is expected to grow to 93.2% by 2030.
Renting cars via mobile applications is the second most common online booking type. Mobile applications must be downloaded and can be accessed easily by the car renter to change the booking details, among other services. For instance, in 2021, the number of smartphone users in the country witnessed 199.18 million, which will likely see significant growth for the online car rental booking service.
With technological advancement, renting a car through online booking is one of the most popular options for customers in recent years. It offers extra features for real-time monitoring of a rental vehicle's operation, performance, and maintenance. Such features significantly benefit drivers and fleet managers, allowing them to spot dangers and execute timely modifications to their rental services more efficiently and effectively.
Government Efforts to Boost Tourism Aiding the Market Growth
The tourism sector contributes a significant share of the car rental service market, owing to the rise in international tourist visitors across the country. The tourism sector contributes around 5% of the country's gross domestic product, which helps boost the country's economy.
The Ministry of Tourism and Creative Economy of Indonesia is investing in the country's tourism industry to foster sustainable and community-based tourism. Five super-priority tourism destinations, eight special economic zones, and 12 sustainable tourism projects are expected to benefit from the investments to increase demand for car rental services during the forecast period.
In March 2022, Minister of Tourism and Creative Economy SandiagaUno met with 18 foreign investors to offer sustainable tourism projects worth USD 1.5 billion. This investment would contribute around 20% to the national tourism industry growth, contributing to 5% national economic growth in 2022.
In August 2021, the Indonesia Investment Coordinating Agency (BKPM) and the Ministry of Tourism and Creative Economy signed an MoU for investment in the tourism and creative economy sectors. The MoU also stated the infrastructure development across the country would attract tourists, increasing the number of visitors across the country.
Owing to multiple such investments and government efforts to improve the market conditions for the car rental market, a considerable rise in tourism expenditure is being witnessed in the country and is projected to continue during the forecast period.
