Car Rental Market Size to Hit USD 137.25 Billion by 2029 | Exhibit a CAGR of 7.5%
Fortune Business Insights
6 min read
Fortune Business Insights
Overburdened Public Transport and Extensive Social Distancing Guidelines to Aid Global Car Rental Market Growth
Pune, India, July 26, 2022 (GLOBE NEWSWIRE) -- The global car rental market size hit USD 68.84 billion in 2021. The market value is slated to rise from USD 82.54 billion in 2022 to USD 137.25 billion by 2029, exhibiting a CAGR of 7.5% during the forecast period. The market has declined significantly as a result of COVID-19, owing to lack of demand in all areas throughout the pandemic. Due to the growing popularity of smartphone-based online rental car booking apps, the car rental industry received a lot of attention. Customers can rent cars from companies for a short or long period of time, says Fortune Business Insights in its report titled, “Car Rental Market, 2022-2029”.
COVID-19 Impact -
Substantial Decline in Global Tourism Industry owing to COVID-19 Pandemic
According to the International Civil Aviation Organization (ICAO), an overall decrease of 2,703 million passengers compared to 2019 and a loss of approximately USD 372 billion in airline passenger operating revenues impacted the airport transportation car rental business in 2020. Furthermore, as tourism declined globally, rental car companies were forced to sell large portions of their fleets.
The market is divided into four segments based on vehicle type, luxury cars, executive cars, economy cars, Sports Utility Vehicles (SUVs), and Multi-Utility Vehicles (MUVs).
Growth Drivers
Market Growth will be Driven by On-Demand Transportation Services
North America Dominated the Global Market Share
Market Drivers-
Market Growth will be Driven by On-Demand Transportation Services
Increasing vehicle prices, limited parking spaces, and high car maintenance costs encourage people to use on-demand transportation services for travel and daily commuting. As a result, rising demand for on-demand transportation is expected to drive market growth during the forecast period.
Increased smartphone sales also influence people's preferences for on-demand transportation services. For ride-hailing and rental services, smartphone apps allow for easy booking and online payment. As a result, the growing popularity and use of smartphone apps and online platforms for rental services provided by ride-hailing companies, such as Uber, Lyft, and others, are driving the market growth. However, during the forecast period, rising oil or fossil fuel prices are expected to hinder the car rental market growth.
The report provides a detailed analysis of the market, focusing on key aspects such as leading companies, vehicle types, and leading service applications. Apart from that, the report provides insights into market trends and highlights key industry developments. In addition to the factors mentioned above, the report includes a number of other factors that have contributed to the market's growth.
Regional Segmentation-
North America Dominated the Global Market Share
Consisting of 36.07% in 2021, North America dominated the global car rental market share. This can be attributed to lack of flexibility in public transportation routes and shift to environment-friendly rental vehicles, further increasing the demand for rental cars for leisure activities and business trips. Furthermore, rising tourism in North America and Europe is increasing the demand for rental services.
The introduction of a dedicated electric vehicle rental service and the entry of leading automobile industry players are expected to grow the business in the European market.
The scenario in Asia Pacific and Latin America, on the other hand, is very different. In these regions, rising vehicle and fuel prices are increasing demand. As the majority of the region's population has middle-class disposable income, renting a car is a popular way to meet travel needs. Furthermore, the Asia Pacific market is expected to grow significantly due to favorable macroeconomic factors and key players' introduction of self-driving vehicle rental fleets.
The Middle East and Africa is expected to grow at the fastest CAGR during the forecast period, owing to increased business and tourism in the region.
During the COVID-19 pandemic, Hertz Rental, a market leader, faced critical challenges and declared bankruptcy. Despite the company's extensive distribution network, particularly in the U.S., it failed to manage funds effectively during the lockdown. To deal with difficult times, the company recently sought USD 1.65 billion in financing.
List of Players Operating in the Car Rental Market are as follows:
Fortune Business Insights™ offers expert corporate analysis and accurate data, helping organizations of all sizes make timely decisions. We tailor innovative solutions for our clients, assisting them to address challenges distinct to their businesses. Our goal is to empower our clients with holistic market intelligence, giving a granular overview of the market they are operating in.
