Global Car Rental Market Size and Share Outlook - Forecast Trends and Growth Analysis Report (2025-2034)

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Car Rental Market Trends

With the rise of smartphones and increased internet penetration, the car rental industry is evolving rapidly. Car rental operators are leveraging data management to optimise fleet operations, providing better services to global travelers. This technological shift allows for seamless bookings and efficient fleet management, enhancing customer satisfaction and meeting the growing demands of today’s modern car rental market. In 2022, UK residents spent £58.5 billion on overseas trips, £43 billion more than in 2021. The average spend per visit was £823, a 2% increase, boosting car rental demand.

The global car rental market is evolving with the rise of bleisure travel, where business trips are combined with leisure activities. Car rental companies are offering flexible rental services to cater to corporate travel, family travel, and the growing demand for environmentally conscious transportation options. With an increased focus on sustainability, many companies are incorporating eco-friendly vehicles like electric cars and hybrid cars into their fleets. This shift provides travelers with more sustainable choices while ensuring a seamless experience for both business and leisure needs, meeting the demands of the modern global traveler.

The global car rental market has experienced significant growth post-pandemic, with a resurgence in both airport and non-airport rentals. As global travel resumed, the car rental industry adapted by implementing strict hygiene and safety standards to boost customer confidence. While airport rentals saw a strong recovery, non-airport rentals also flourished, driven by the rise in domestic travel. This shift in demand highlights the industry's resilience and its ability to cater to evolving customer needs, ensuring a safe and convenient travel experience for all.

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Consumer Insights

Consumer insights in the global car rental market reveal that rental car preferences have evolved, with travellers seeking more flexible options for both vacation travel and leisure travel. Effective rental fleet management has become crucial for car rental companies to meet these demands, ensuring a diverse selection of vehicles for customers. Many prefer vehicles that offer comfort and reliability during their trips, with a growing interest in eco-friendly rental cars. As the demand for both vacation and leisure travel continue to rise, rental car companies are adapting to meet the evolving needs of consumers.

The car rental market shows a growing demand for high-end vehicles and luxury rental cars. Car renters are increasingly seeking premium options, with many opting for high-performance vehicles for both business and leisure trips. Rental car companies are responding by expanding their fleets to include more luxury vehicles. Aion, GAC Motor's all-electric brand, will launch in Australia in April 2025 with a hatchback comparable to the Toyota Corolla, adding more consumer options with another Chinese EV brand.

In the global car rental market, rental car accidents and rental car collisions remain significant concerns. To mitigate these risks, rental car companies and operators are increasingly turning to advanced telematics and fleet management software. These technologies help monitor vehicle usage in real time, enabling operators to track driving patterns and identify potential hazards. In September 2024, Cummins, Bosch, and KPIT Technologies partnered to launch Eclipse CANought, an open-source telematics software for commercial vehicles. This initiative, part of the Eclipse Software Defined Vehicle project, aimed to reduce development costs and standardise access to vehicle ECUs.

Affordability remains a key factor for consumers seeking rental cars. Many travellers opt for fuel-efficient vehicles to save on fuel costs during their trips. To further enhance cost-saving, the rental checkout process has become more streamlined, offering customers faster service. Additionally, consumers often balance the cost of rent with location trade-offs, choosing to rent cars from locations that may offer more competitive pricing, even if slightly further from their destination, ensuring they get the best value for their travel needs. The China Passenger Car Association and the European Automobile Manufacturers’ Association reported that global electric car sales reached about 3.5 million units in Q1 2024, a rise from 1.75 million units in Q1 2022.

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Vehicle Insights

In the global car rental market, economy car rentals have become a popular choice for budget-conscious travelers seeking affordable travel options. Economy cars, offering compact and efficient models, provide a cost-effective solution for both leisure travelers and business travellers. Car rental companies are expanding their fleets, with major players focusing on enhancing economy car offerings to meet the growing demand. These low-cost options appeal to travelers looking for affordability without sacrificing comfort. As demand for affordable rentals continues to rise, car rental companies are ensuring they offer a wide variety of compact and economy models, catering to the needs of cost-conscious customers. In February 2024, Savaari Car Rentals and MakeMyTrip, an Indian travel company, partnered to enhance the road travel network. MakeMyTrip acquired a majority stake, marking Savaari's entry into the fragmented inter-city cab rental market.

The global car rental market is seeing significant growth in the demand for SUVs, with a strong CAGR forecasted for the coming years. SUV rentals offer spacious interiors and increased cargo capacity, making them an ideal choice for families and travelers seeking comfortable transportation. Compared to traditional sedans, SUVs provide enhanced safety and stability, especially on road trips or outdoor adventures. Their ability to navigate various terrains and weather conditions makes them a reliable option for those exploring different landscapes. SUV rentals have become particularly popular for long-distance travel and trips that require ample space, ensuring a comfortable and safe experience for all passengers. With their versatility, SUVs are increasingly becoming the preferred choice for those seeking both practicality and luxury in their rental vehicles.

Application Insights

Airport car rentals have seen a surge in demand, particularly among travelers seeking convenience upon arrival. With the growth of international tourism and air travel, airport car rentals offer a cost-effective solution for both business travelers and tourists. Rental desks at airports provide easy access to rental services, ensuring a smooth and efficient process. Car rental companies are expanding their fleets to cater to the increasing number of travelers, ensuring that there are ample options available. According to data from the Philippine DFA, South Korea led as the top source of international visitors in 2023 with 1,439,336 arrivals, followed by the United States with 903,299, and Japan with 305,580. This growing demand reflects the changing needs of tourists and business travelers, who prefer the flexibility and ease that airport car rentals offer, making travel more convenient and accessible.

The global car rental market is experiencing growth, with a significant shift towards car rentals for local usage, driven by urbanization and changing mobility preferences. This sector shows a strong CAGR as consumers increasingly prefer flexible, on-demand transportation solutions. Car rentals are now widely chosen for short-term travel, meeting the needs of both business and leisure travellers. Local rental options are becoming more popular in urban areas, where traditional car ownership is less desirable. Car-sharing models, such as Zipcar and Turo, are gaining traction, providing short-term solutions that complement personal vehicle use for local usage. Additionally, subscription-based services and digital platforms have made it easier for consumers to rent vehicles for brief periods. These trends reflect a broader shift away from traditional car ownership, with renters seeking convenient, cost-effective alternatives for short-term business and leisure needs.

Booking Mode Insights

The global car rental market is increasingly driven by online bookings, with consumers turning to digital platforms and online channels for convenience. These platforms enable users to make bookings in real time, streamlining the reservation process. Online bookings have become the preferred method for travellers, offering greater flexibility and a seamless experience. By using digital platforms, customers can easily compare prices, choose from a variety of vehicles, and secure their rental in just a few clicks. This shift towards online booking methods is reshaping the car rental industry, making it more accessible and efficient for modern travellers.

The global car rental market has witnessed various booking modes, with offline/direct car rental bookings being a significant trend. These offline bookings often involve face-to-face interactions at rental counters, where customers can directly engage with agents to finalise their rental agreements. Despite the growth of online platforms, offline rentals remain important for those seeking personalised service and immediate assistance. Rental counters continue to play a key role, offering customers the chance to ask questions, inspect vehicles, and make real-time decisions. These traditional methods of booking provide an alternative to the digital shift, appealing to a wide range of travellers. In April 2024, LOTTE Auto Global, a subsidiary of South Korea's leading car rental company, expanded its used car exports to the Middle East. The company offers transparent vehicle information and convenient online auctions, with over 1,000 cars available, including Hyundai and Kia models.

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If you choose to purchase the full report at a later stage, the amount already paid will be adjusted, and you will only need to pay the remaining balance.

Purchase the Regional Overview for USD 1099

If you choose to purchase the full report at a later stage, the amount already paid will be adjusted, and you will only need to pay the remaining balance.

Purchase the Regional Overview for USD 1099

If you choose to purchase the full report at a later stage, the amount already paid will be adjusted, and you will only need to pay the remaining balance.

Regional Insights

The car rental market has seen varied growth across different regions, with car rental operators adapting to the diverse needs of travelers. In major tourist destinations, car rental services are increasingly popular for both leisure trips and business trips, offering flexibility and convenience. In regions with high tourist traffic, such as Europe and North America, car rentals are essential for visitors seeking to explore local attractions. Additionally, with the rise of international travel, car rental operators have focused on enhancing their fleet and services to cater to the increasing demand. As more travelers seek hassle-free transport options, the car rental market continues to expand globally.

U.S. Car Rental Market Trends

The car rental industry has experienced significant changes, especially in the post pandemic era. As leisure travel rebounds, demand for rental cars has surged, with many travellers opting for short-term vehicle rentals for road trips and exploring new destinations. Business travel has also seen a resurgence, contributing to increased bookings. Domestic tourists, seeking safe and flexible travel options, have further boosted the market. Car rental operators are adapting to changing preferences by expanding their rental fleets, with a growing emphasis on electric vehicles (EVs) to meet the demand for ecofriendly transportation. As sustainability becomes a priority, rental operators are focusing on offering greener options, ensuring that they remain competitive in an evolving market. The future of the car rental industry looks promising as it embraces innovation and eco-conscious choices.

Europe Car Rental Market Trends

The Europe car rental industry has witnessed robust growth, driven by the region's thriving tourism industry. As international travellers increasingly seek flexibility, rental cars have become a popular choice for exploring diverse destinations. With a variety of options available, car rentals offer convenience for visitors wishing to travel at their own pace, particularly in areas with high tourist demand. In February 2025, Poppy Mobility launched Belgium’s first remote-driven car rental service, in collaboration with Ush. Test operations around the Port of Antwerp-Bruges allowed users to request rental cars via the Poppy app, with vehicles remotely driven to their location. Poppy plans a full launch in Antwerp by 2026.

Asia Pacific Car Rental Market Trends

The car rental industry in the Asia Pacific region has shown significant regional market growth, with a strong CAGR driven by rising demand for car rental services. Business travel has played a key role in this expansion, especially in major markets like China and India. In China, the government has introduced several initiatives to combat pollution and traffic congestion, affecting car rental operations in urban areas. However, demand for rental cars continues to rise, particularly in second-tier cities. India has also witnessed increasing demand, driven by a growing middle class and more travellers seeking flexible transport options. Despite regulatory challenges, the Asia Pacific market remains a dynamic and rapidly evolving space for the car rental industry.

Key Car Rental Company Insights

Key Car Rental Companies

• The Hertz Corporation
• Avis 
• Enterprise Holdings
• Sixt
• Europcar
• Uber Technologies Inc.
• Localiza
• ANI Technologies Private Limited (Ola Cabs)
• Carzonrent
• Bettercar Rental LLC
• Shenzhen Zhizun Car Rental Co., Ltd. 
• Ace Rent A Car Reservations, Inc.
• Budget Rent A Car System, Inc.
• Midway Auto Group
• EMMANKO AG
• ALD Automotive
• Movida
• Al-Futtaim Vehicle Rentals (AVR)

Recent Developments

January 2025

Finalrentals, a rapidly growing car rental firm based in Cardiff, expanded into South America by securing its first partners in Argentina and Chile. In Argentina, partnerships were formed in Cordoba and Mendoza, while Chile's first partner is in Puerto Montt. These expansions align with strong growth projections for both markets between 2025-2029.

October 2024

Enterprise Mobility extended its footprint in Asia-Pacific by launching Enterprise Rent-A-Car, National Car Rental, and Alamo branches in Thailand via its franchise partner, Thai Rent a Car. This expansion follows similar efforts in Japan, South Korea, and New Zealand, enhancing travel options for business and leisure travellers.

February 2024

Enterprise Mobility has partnered with Thai Rent a Car to introduce Enterprise Rent-A-Car, National Car Rental, and Alamo brands in Thailand. Thai Rent a Car, a prominent provider, will oversee the new locations, improving car rental services for both domestic and international customers in the country.

May 2023

Car Karlo launched self-driven car rental services in Pune, allowing customers to rent vehicles without a driver. This initiative aimed to offer more flexibility for those who wanted to drive themselves. It marked a significant expansion for the company, responding to the increasing demand for self-driven rentals in urban areas, with a range of vehicles available for consumers in Pune.

Global Car Rental Market Report Segmentation