In the fast-paced world of travel, convenience and flexibility are key. Whether you’re planning a cross-country road trip, exploring a new city, or needing a quick, hassle-free way to get around on your next adventure, car rentals continue to be a go-to option for millions of travelers worldwide. Car rentals provide a convenient way for tourists to explore popular destinations, making them an essential transportation solution in densely populated urban areas.
With the industry undergoing rapid changes and adapting to modern travel demands, it’s the perfect time to explore the latest trends and projections for the global car rental market.
As we look ahead to 2024 and beyond, the car rental industry is expected to undergo significant growth, becoming an even more integral part of the global travel ecosystem. Whether you’re a frequent traveler or someone looking to rent for an upcoming holiday, understanding these trends can help you make more informed choices about your next rental experience.
In this blog post we look at the latest trends in the car rental industry according to Statista.
Car Rental Market Overview
The car rental market is a dynamic and rapidly growing industry, providing both individuals and businesses with the flexibility to access vehicles on a temporary basis. This market has seen significant expansion in recent years, driven by a surge in demand for car rental services, particularly within the tourism and business sectors. The competitive landscape is bustling with numerous car rental companies vying for market share, each striving to offer the best services and prices.
Technological advancements have played a pivotal role in this growth. Online booking platforms and mobile apps have revolutionized the way customers rent cars, making the process more convenient and efficient. These digital tools allow users to compare prices, check vehicle availability, and make reservations with just a few clicks, enhancing the overall customer experience. As a result, the car rental market continues to thrive, adapting to the evolving needs of modern travelers.
Top 5 Car Rental Industry Trends
The car rental industry is set for remarkable growth over the next few years. As travel continues to rebound and demand for convenient mobility options rises, the global car rental market is projected to reach a revenue milestone of US$104.40 billion by 2024. This signifies the growing importance of this market within the global travel and mobility landscape.
Here are the top 5 car rental industry trends.
Booming Car Rental Market Size Growth: A Snapshot of 2024-2029
According to the latest market projections, the global car rental industry is set to achieve US$104.40 billion in revenue by 2024. But that’s just the beginning of a robust growth trajectory. Between 2024 and 2029, the industry is anticipated to expand at a compound annual growth rate (CAGR) of 3.52%, reaching an impressive US$124.10 billion by 2029.
What does this mean for you, the traveler? More options, more competitive pricing, and likely a greater variety of vehicles to suit your specific travel needs. From compact cars for quick city trips to SUVs for rugged off-road adventures, the expansion of the market ensures that travelers can find exactly what they need, when they need it.
The Rising Number of Car Rental Users
In tandem with revenue growth, the number of global car rental users is projected to climb to 0.82 billion by 2029, reflecting the increasing popularity of rental cars for leisure and business travel alike. In 2024, 7.7% of the population will be using car rental services, but this number is expected to rise to 10.1% by 2029.
Why is this happening? Travelers are seeking more freedom in their journeys. While ride-sharing services and public transportation have their benefits, nothing compares to the flexibility and independence of having your own rental car at your disposal. This trend will likely continue to rise as people value private transport options, especially in a post-pandemic world where social distancing and personal space are priorities.
How Much Do Travelers Spend on Car Rentals?
Another key consideration for travelers is how much they can expect to spend on car rentals. By 2029, the average revenue per user (ARPU) is forecasted to reach US$175.40, indicating a stable pricing structure. For many, this means that car rentals will remain an affordable and accessible option, especially for those who book in advance or take advantage of online deals and loyalty programs.
Furthermore, the growth of long-term and luxury car rentals is contributing to this ARPU. Many travelers are now opting for premium experiences, including renting high-end vehicles for vacations or extended trips, adding a touch of luxury to their journeys.
The Rise of Online Sales: A Digital Transformation
Perhaps the most striking trend in the car rental industry is its digital transformation. By 2029, a staggering 75% of all car rental revenue is expected to come from online sales. The convenience of booking online—whether through dedicated apps, travel platforms, or the car rental company’s own website—has made renting a car easier and faster than ever before.
For travelers, this means a more seamless experience. You can compare prices, check vehicle availability, and even read reviews—all from the comfort of your home or while on the go. Many car rental companies have streamlined their processes, offering quick online check-ins, contactless pick-ups, and 24/7 customer service, making it an ideal option for tech-savvy and busy travelers.
This digital shift also brings exciting innovations, such as the integration of smart technologies in rental vehicles. Expect features like enhanced GPS navigation, real-time traffic updates, and mobile apps that allow you to control aspects of your rental car from your phone.
The U.S. Leads the Way
When it comes to global market leaders, the United States stands out, expected to generate US$31.54 billion in car rental revenue in 2024 alone. U.S. car rental companies have recognized the need to stay competitive against the rise of ride-sharing services, such as Uber and Lyft, and have responded by offering more flexible rental options, improved loyalty programs, and perks like one-way rentals or monthly subscriptions. Major rental companies are expanding their fleets to include electric and hybrid vehicles to appeal to environmentally conscious customers while also adapting to shifting market trends and preferences.
For travelers heading to the U.S., this means more competitive offers, whether you’re renting a car for a short weekend getaway or a month-long road trip across the country.
Travelers can expect user-friendly platforms, greater vehicle availability, and a wide range of services tailored to meet individual needs, including eco-friendly vehicles, luxury car options, and specialized travel packages.
Market Size and Share
The global car rental market size was valued at an impressive USD 129.1 billion in 2023, and it shows no signs of slowing down. Projections indicate a robust compound annual growth rate (CAGR) of over 7% from 2024 to 2032. This growth is largely driven by a few dominant players in the industry, including Enterprise Holdings Inc., Hertz System Inc., and Avis Budget Group. These companies hold a significant market share and are continuously investing in digital transformation and sustainability initiatives to maintain their competitive edge.
As these major car rental companies innovate and expand their offerings, they are setting the pace for the entire industry. Their focus on enhancing customer experience through technology and sustainable practices is not only beneficial for their business but also for the environment and the overall market growth.
Car Rental Companies
The car rental market is characterized by intense competition, with numerous companies operating on a global scale. Some of the major players in this industry include:
Enterprise Holdings Inc.
Hertz System Inc.
Avis Budget Group
SIXT
Getaround
Turo
These companies offer a diverse range of car rental services to cater to various customer needs. From economy cars that provide cost-effective and fuel-efficient options to luxury cars that offer a premium driving experience, there is something for everyone. Additionally, the inclusion of electric vehicles in their fleets reflects a growing commitment to sustainability.
Rental options are also varied, with short-term rentals for quick trips, long-term rentals for extended use, and subscription-based services for those who prefer a more flexible arrangement. This variety ensures that customers can find the perfect rental solution to meet their specific requirements.
Vehicle Type Insights
When it comes to vehicle types, the economy cars segment stands out as the largest in the car rental market, accounting for over 33% of the market share. Economy cars are highly favored by customers due to their affordability and fuel efficiency, making them an ideal choice for budget-conscious travelers.
However, the market is not limited to economy cars. The SUVs segment is expected to grow at the fastest CAGR of 11.5% during the forecast period. This growth is driven by the increasing demand for spacious and comfortable vehicles, particularly for family trips and off-road adventures. As more travelers seek out these versatile vehicles, the car rental market continues to diversify its offerings to meet changing preferences.
Rental Car Pricing Statistics
Rental car prices can be quite volatile, influenced by factors such as demand and supply. The average weekly rental price varies significantly depending on the rental company and location. For instance, Thrifty is currently the cheapest rental car company, with an average weekly rental price of $414.34.
Timing also plays a crucial role in rental car pricing. Booking a rental car last-minute can often result in lower prices, as companies aim to fill their inventory. On average, booking a car rental 91 days in advance can cost around $555 per week, while booking just 7 days in advance can reduce the price to $481, offering a 13% discount.
Understanding these pricing dynamics can help travelers make more cost-effective decisions when renting a car, ensuring they get the best value for their money.
What Does the Future Hold?
The car rental industry is evolving to meet the modern traveler’s needs. As sustainable travel becomes more popular, we can expect to see more green initiatives from car rental companies, including the increased availability of electric vehicles (EVs) and hybrid cars in rental fleets. These options are perfect for the eco-conscious traveler looking to reduce their carbon footprint while exploring the world.
Additionally, shared mobility services are likely to become more integrated with traditional car rentals. This means travelers could have access to cars for shorter periods of time, renting by the hour or even by the minute in some urban locations.
Flexibility will be key in the future of car rentals, making it easier than ever for travelers to get from point A to point B on their own terms.
Final Thoughts: The Car Rental Market’s Impact on Travel
For the modern traveler, the rise of the car rental industry presents new and exciting opportunities.
From improved digital experiences and sustainable travel options to more competitive pricing and greater flexibility, the future of car rentals is bright. As the market grows and adapts to changing travel trends, it’s an exciting time to be on the road.
Whether you’re planning your next adventure or a business trip, car rentals are sure to remain a cornerstone of modern travel, providing convenience, choice, and the freedom to explore on your own schedule.
