The Tourism Vehicle Rental Market was valued at USD 61.28 billion in 2021 and is expected to reach USD 63.48 billion by 2026 registering a CAGR of around 8.58% during the Forecasts period (2021 - 2027).
The COVID-19 pandemic hindered the growth of the Tourism Rental Market as there were global factory shutdowns, travel bans, and border lockdowns, to combat and contain the outbreak, impacting every industry and economy worldwide. As tourism is a huge market, the demand for vehicle rentals halted with continuous lockdowns across the world.
However, as the unlocking process began restoring economic activities Tourism vehicle rental market is expected to witness a nominal growth during the Forecasts period. People tend to prefer rental vehicles to any other means of transportation to maintain social distancing and hygiene protocols.
Other driving factors of the tourism vehicle rental market are, comfort, quality of life, freedom of moment, affordability, and low cost of traveling. The luxury vehicles segment will grow at the fastest pace during the Forecasts period owing to increased travel budgets of tourists around the world.
Region-wise, Asia-Pacific is one of the fastest-growing regional markets for tourism vehicle rental within the Forecasts period due to the growing population coupled with transportation issues in the region. Tourism vehicle rental service is very useful in Asian countries like India, Australia, Cambodia, Japan, China, etc. North America is expected to witness significant growth amid rising road trips by people during Forecasts period. According to the US Travel Association, the number of domestic leisure trips accounted for 1,676.2 million in 2021 and is expected to reach over 1,998 million by 2024.
Increased concern and awareness about the containment of the virus have primarily led to an increase in vehicle rental options. Additionally, the tourism vehicle rental market also provides the option of increased mobility without the concern of paying the costs associated with vehicle ownership. These services are offered via websites and through other online platforms attributing to the growth of the market.
Increasing penetration of the internet and smartphone among consumers is estimated to shift consumers’ inclination toward online booking mode. The growth is attributed to consumers’ preference to have detailed access to the offerings of accommodation, amenities, and other benefits. For instance, in 2021 more than 60% of the total vehicle rental booking were made through online means. Additionally, owing to the increased internet usage, this number is expected to cross 70% by 2026.
With the growing trend in technology, renting a vehicle through online booking has become the most preferred choice of customers over the past few years. Moreover, it provides additional facilities to monitor a rental vehicle’s operation, performance, and maintenance in real-time. Such features are tremendous assets for drivers and fleet managers, enabling them to better identify risks and implement timely improvements to their rental services.
Value for money, convenience, and search for authentic travel experiences are major factors fueling the growth of online booking. The increasing number of startups and third-party travel booking companies are offering services via application and website only. Hence, consumers are shifting their preferences from offline booking mode to online. These aforementioned factors are boosting the growth of online booking mode.
With a total vehicle fleet size in excess of several million, the United States is the leader in the tourism vehicle rental market, but the market is saturated and will post modest gains as the impact of COVID-19 is inevitable. However, the tourism vehicle rental market is expected to be dominated by North America during the Forecasts period (2021 -2027).
Major car-renting companies have their fleets in almost all the major cities. The size of the fleet for any player depends on the number of tourists preferring to rent a vehicle locally and the volume of foreign passengers visiting a city. Canada has a large domestic and foreign tourism industry.
Being the second-largest country in the world, Canada's incredible geographical variety and the presence of around 20 world heritage sites are significant tourist attractions across the country. Much of the country's tourism is centered in regions like Toronto, Montreal, Vancouver/Whistler, Niagara Falls, Vancouver Island, Calgary/Canadian Rockies, British Columbia's Okanagan Valley, and the national capital region Ottawa. Therefore, these regions are some major hotspots for tourism vehicle renting.
Apart from these factors, increasing demand for rental vehicles is mainly driven by people's interest in road trips and the rising importance of comfort and safety in the wake of the pandemic. The tourism rental market is expected to grow gradually as transport operations returned to their normal functioning with a new normal, i.e., following social security guidelines for safety.
The tourism vehicle rental market is consolidated and dominated by few players, such as Enterprise Holdings Inc., Hertz Global Holdings Inc., Avis, Europcar Mobility Group, Sixt SE, Budget, among others. The companies are expanding their fleet size and launching. For instance,
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The COVID-19 pandemic hindered the growth of the Tourism Rental Market as there were global factory shutdowns, travel bans, and border lockdowns, to combat and contain the outbreak, impacting every industry and economy worldwide. As tourism is a huge market, the demand for vehicle rentals halted with continuous lockdowns across the world.
However, as the unlocking process began restoring economic activities Tourism vehicle rental market is expected to witness a nominal growth during the Forecasts period. People tend to prefer rental vehicles to any other means of transportation to maintain social distancing and hygiene protocols.
Other driving factors of the tourism vehicle rental market are, comfort, quality of life, freedom of moment, affordability, and low cost of traveling. The luxury vehicles segment will grow at the fastest pace during the Forecasts period owing to increased travel budgets of tourists around the world.
Region-wise, Asia-Pacific is one of the fastest-growing regional markets for tourism vehicle rental within the Forecasts period due to the growing population coupled with transportation issues in the region. Tourism vehicle rental service is very useful in Asian countries like India, Australia, Cambodia, Japan, China, etc. North America is expected to witness significant growth amid rising road trips by people during Forecasts period. According to the US Travel Association, the number of domestic leisure trips accounted for 1,676.2 million in 2021 and is expected to reach over 1,998 million by 2024.
Key Market Trends
Online Booking Expected to Witness Growth
Increased concern and awareness about the containment of the virus have primarily led to an increase in vehicle rental options. Additionally, the tourism vehicle rental market also provides the option of increased mobility without the concern of paying the costs associated with vehicle ownership. These services are offered via websites and through other online platforms attributing to the growth of the market.
Increasing penetration of the internet and smartphone among consumers is estimated to shift consumers’ inclination toward online booking mode. The growth is attributed to consumers’ preference to have detailed access to the offerings of accommodation, amenities, and other benefits. For instance, in 2021 more than 60% of the total vehicle rental booking were made through online means. Additionally, owing to the increased internet usage, this number is expected to cross 70% by 2026.
With the growing trend in technology, renting a vehicle through online booking has become the most preferred choice of customers over the past few years. Moreover, it provides additional facilities to monitor a rental vehicle’s operation, performance, and maintenance in real-time. Such features are tremendous assets for drivers and fleet managers, enabling them to better identify risks and implement timely improvements to their rental services.
Value for money, convenience, and search for authentic travel experiences are major factors fueling the growth of online booking. The increasing number of startups and third-party travel booking companies are offering services via application and website only. Hence, consumers are shifting their preferences from offline booking mode to online. These aforementioned factors are boosting the growth of online booking mode.
Rising Demand for Tourism Rental Vehicles in North America
With a total vehicle fleet size in excess of several million, the United States is the leader in the tourism vehicle rental market, but the market is saturated and will post modest gains as the impact of COVID-19 is inevitable. However, the tourism vehicle rental market is expected to be dominated by North America during the Forecasts period (2021 -2027).
Major car-renting companies have their fleets in almost all the major cities. The size of the fleet for any player depends on the number of tourists preferring to rent a vehicle locally and the volume of foreign passengers visiting a city. Canada has a large domestic and foreign tourism industry.
Being the second-largest country in the world, Canada's incredible geographical variety and the presence of around 20 world heritage sites are significant tourist attractions across the country. Much of the country's tourism is centered in regions like Toronto, Montreal, Vancouver/Whistler, Niagara Falls, Vancouver Island, Calgary/Canadian Rockies, British Columbia's Okanagan Valley, and the national capital region Ottawa. Therefore, these regions are some major hotspots for tourism vehicle renting.
Apart from these factors, increasing demand for rental vehicles is mainly driven by people's interest in road trips and the rising importance of comfort and safety in the wake of the pandemic. The tourism rental market is expected to grow gradually as transport operations returned to their normal functioning with a new normal, i.e., following social security guidelines for safety.
Competitive Landscape
The tourism vehicle rental market is consolidated and dominated by few players, such as Enterprise Holdings Inc., Hertz Global Holdings Inc., Avis, Europcar Mobility Group, Sixt SE, Budget, among others. The companies are expanding their fleet size and launching. For instance,
- Avis Budget Group Inc. added 6,000 Peugeot, Citroën, and DS vehicles to its connected car rental fleet in Europe. These vehicles may operate across the company’s Avis and Budget brands in Austria, Belgium, the Czech Republic, France, Germany, Italy, Luxembourg, the Netherlands, Portugal, Spain, Switzerland, and the United Kingdom, along with the Maggiore brand in Italy.
- Hertz Europe launched free mobile Wi-Fi and other exclusive benefits for qualifying car rentals in more than 200 locations across Europe.
Additional Benefits:
- The market estimate (ME) sheet in Excel format
- 3 months of analyst support
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Table of Contents
1 INTRODUCTION
4 MARKET DYNAMICS
5 MARKET SEGMENTATION
6 COMPETITIVE LANDSCAPE
Companies Mentioned (Partial List)
A selection of companies mentioned in this report includes, but is not limited to:
- Auto Europe Deutschland GmbH
- Avis Budget Group, Inc.
- Seera Group Holdings Co.
- Carzonrent India Private Limited
- Enterprise Holdings, Inc.
- Europcar Mobility Group
- The Hertz Corporation
- Sixt SE
- ZoomCar, Inc.
Methodology
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