An expanding travel & tourism industry and rapid urbanization drive the rental cars market growth

Rental Cars Procurement Intelligence

Rental cars procurement has become a game changer amidst burgeoning urbanization and growth in business and leisure travel. The global market size stood at USD 132.48 billion in 2023. The rising urban population with an increasing tendency towards adventure and travel is boosting growth. In essence, North America accounts for the largest share of the market. Companies are focusing on adopting various strategies such as investments, partnerships, and mergers & acquisitions. For instance, in April 2022, SIXT, a leading global mobility provider, announced the opening of two new branches in Charlotte and Baltimore, expanding its presence on the East Coast. The new branches offer customers a wider range of rental choices and provide SIXT with a stronger foothold in this region. 

Mobility-as-a-Service (MaaS) is a service that offers users the ability to plan, reserve, and pay for a variety of mobility services through a single digital channel. A transition from privately owned modes of transportation to mobility as a service is outlined in the concept. This is made possible by bundling transportation services from both public and private transportation providers through a single payment portal that initiates and manages the journey.

Companies are either looking to develop their (own) platform or trying to partner with those companies that have such offerings to enhance their technologies to meet growing customer needs. For instance,

• In March 2023, Woodford Group and Enterprise Holdings signed a collaboration agreement. Enterprise Holdings declared launching its service in South Africa as part of the cooperation. The company provides point-to-point services, long-term subscriptions, and short-term car rentals with chauffeurs.

• In February 2023, Udrive, a pay-per-minute car rental platform, launched a new offering that helps users to explore tourist attractions in the highlights of Dubai. Under this offering, the company is offering an exclusive fleet to and from Hatta.

• In January 2023, Hertz signed a public-private partnership with the regulatory body of Denver, Colorado, to accelerate the transition of EVs in the rental industry. The company will switch towards providing rental electric cars contributing towards sustainability.

• In October 2022, ERGO partnered with SIXT and agreed to perform a pilot project using a pay-as-you-drive pricing model. Under this partnership, ERGO would offer an exclusive insurance solution that caters to the needs of SIXT’s rental cars in Germany.

The industry growth is expected to be driven by rising urbanization around the globe. The increasing traffic congestion and tougher automobile ownership laws are key factors driving this trend. The rising demand for on-demand transportation services is attributed to the low rate of car ownership among millennials, the increasing cost of car ownership, and the demand for flexible and cost-effective transportation options.

Request a free sample copy or view report summary: Rental Cars Procurement Intelligence Report

Rental Cars Sourcing Intelligence Highlights

• The global rental cars market is characterized as fragmented, with a large number of small and large players operating in different regions. This fragmentation has led to intense competition between players, as they strive to gain a wider customer base and improve customer experiences.

• The suppliers have increased over time, reducing the supplier’s bargaining power to some extent.

• Asset depreciation, fuel, accident insurance, and maintenance form the most significant cost component in providing rental cars. The overall cost also depends on factors such as local tax, registration, and administrative overheads.

• Most of the service providers offer complete services from rental cars, pickup & drop-off, insurance, chauffeurs, and others.

Rental Cars Procurement Intelligence Report Coverage

Grand View Research will cover the following aspects in the report:

• Market Intelligence, along with emerging technology and the regulatory landscape

• Market estimates and forecasts from 2024 to 2030

• Growth opportunities, trends, and driver analysis

• Supply chain analysis, supplier analysis with supplier ranking and positioning matrix, supplier’s recent developments

• Porter’s 5 forces

• Pricing and cost analysis, price trends, commodity price forecasting, cost structures, pricing model analysis, supply and demand analysis

• Engagement and operating models, KPI, and SLA elements

• LCC/BCC analysis and negotiation strategies

• Peer benchmarking and product analysis

• Market report in PDF, Excel, PPT, and online dashboard versions

Cost Intelligence Highlights

As part of the rental cars procurement intelligence report, Grand View Research has identified the following key cost components:

• Asset Depreciation

• Fuel

• Accident Insurance

• Maintenance

• Consensus Protocol

• Local Taxes

• Registration

• Administrative Overheads

Asset depreciation, fuel, accident insurance, and maintenance volume form the largest cost components of rental cars.

Rental Cars - Key Suppliers

• Sixt SE

• Localiza

• Avis Budget Group

• Europcar

• Enterprise Holdings Inc.

• The Hertz Corporation

• Toyota Rent-a-Car

• Alamo Rent-a-Car LLC

• Carzonrent India Pvt Ltd

• ANI Technologies Pvt. Ltd