The tourism vehicle rental market is anticipated to register a CAGR of 7.87%, during the forecast period (2020 - 2025).
- Over the decades, tourism has been rapidly growing, while experiencing deepening diversification and becoming one of the fastest growing economic sectors in the world. Modern tourism is closely linked to development and encompasses a growing number of new destinations. These dynamics have turned tourism into a key driver for socio-economic progress. As tourism is a huge market, the demand for vehicle rentals is growing around the world.
- Tourism Car rental companies are developing strategic partnerships with corporates, airlines, insurance companies and universities to reduce the percentage of single occupancy vehicles while touring .
- The major growth is expected to come from the Asia-Pacific countries, like Vietnam, the Philippines, India, and China, where tourism is expected to grow sharply. The tourism transportation sector is largely dominated by unorganized sector. The tourism sector in Iran is expected to boom, following the lifting of sanctions. Iran has a rich cultural heritage, important monuments, and tourist destinations. The number of foreign tourists is expected to rise exponentially. The local vehicle e-rental market in the country is underdeveloped and offers tremendous opportunities to the players.
- Increased concern and awareness of lower emissions have primarily led to an increase in car rental options. Additionally, vehicle rental also provides the option of increased mobility, without the concern of paying the costs associated with car ownership. These services are offered via websites and through other online platforms, which has helped the growth of the tourism vehicle rental market.
Key Market Trends
Rise in Tourism Sector and leisure travelling
The global travel and tourism sector grew at 3.9%, contributing a record of USD 8.8 trillion to the world economy, during 2018. The global tourism industry grew faster than the global economy for the eighth successive year (3.9% for travel and tourism versus 3.2% for the global GDP).
In 2018, travel and tourism increased its share of leisure spending to 78.5%, from 77.5% in 2017. Additionally, spending from international tourists increased to 28.8% in 2018. Europe and Asia-Pacific are the major tourist destinations for both domestic and international travels. Both the regions dominated the international tourist's arrivals with Europe reaching 713 million and Asia-Pacific reaching 343 million, in 2018. In Europe, France witnessed the highest footfall of international tourists, followed by Spain and Italy.
Increase in disposable income in emerging economies such as China and India has allowed customers to spend on travel. Air travel industry grew by 6% in 2018. This is resulted in increased usage of Airport transportation system. More than 50% of car rental revenue came from airport usage in 2019 which is expected to grow to 57.66% by 2025.
Outstation rentals and SUV rentals are expected to significantly grow during the forecast period.
North America - Leading the Tourism Vehicle Rental Market
The tourism vehicle rental market is dominated by North America, followed by Asia-Pacific and Europe. According to the US Travel Association, the number of domestic leisure trips accounted for 1,821.2 million in 2018 and is expected to reach over 1,900 million by 2022. More than 50% of US citizens hire a car during holidays.
Currently, both the people coming to the country and the people in the country touring to other parts of the country are opting for road trips during their vacations, which is a driving factor for the rising demand for car rentals in the country
In the United States, tourism vehicle rental services are present across the country. 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 car locally and the volume of foreign passengers visiting to 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 for 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 of the major hotspots for car renting in the country.
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 and among others. The companies are expanding their fleet size and launching. For instance:
Avis Budget Group Inc. added 6,000 Peugeot, Citroen, 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.
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Table of Contents
- 1.1 Study Assumptions
- 1.2 Scope of the Study
2 RESEARCH METHODOLOGY
3 EXECUTIVE SUMMARY
4 MARKET DYNAMICS
- 4.1 Market Drivers
- 4.2 Market Restraints
- 4.3 Industry Attractiveness - Porter's Five Forces Analysis
- 4.3.1 Threat of New Entrants
- 4.3.2 Bargaining Power of Buyers/Consumers
- 4.3.3 Bargaining Power of Suppliers
- 4.3.4 Threat of Substitute Products
- 4.3.5 Intensity of Competitive Rivalry
5 MARKET SEGMENTATION
- 5.1 By Vehicle Type
- 5.1.1 Economy
- 5.1.2 Luxury/Premium
- 5.2 By Booking Type
- 5.2.1 Online
- 5.2.2 Offline
- 5.3 By End-user Type
- 5.3.1 Self-driven
- 5.3.2 Rental Agencies
- 5.4 Geography
- 5.4.1 North America
- 22.214.171.124 United States
- 126.96.36.199 Canada
- 188.8.131.52 Rest of North America
- 5.4.2 Europe
- 184.108.40.206 Germany
- 220.127.116.11 United Kingdom
- 18.104.22.168 France
- 22.214.171.124 Spain
- 126.96.36.199 Rest of Europe
- 5.4.3 Asia-Pacific
- 188.8.131.52 China
- 184.108.40.206 Japan
- 220.127.116.11 India
- 18.104.22.168 South Korea
- 22.214.171.124 Rest of Asia-Pacific
- 5.4.4 South America
- 126.96.36.199 Brazil
- 188.8.131.52 Argentina
- 184.108.40.206 Rest of South America
- 5.4.5 Middle-East & Africa
- 220.127.116.11 United Arab Emirates
- 18.104.22.168 Saudi Arabia
- 22.214.171.124 South Africa
- 126.96.36.199 Rest of Middle-East & Africa
6 COMPETITIVE LANDSCAPE
- 6.1 Vendor Market Share
- 6.2 Company Profiles
- 6.2.1 Autoeurope LLC
- 6.2.2 Avis LLC
- 6.2.3 Budget Rent A Car System Inc.
- 6.2.4 Carzonrent India Pvt. Ltd.
- 6.2.5 Easycar (EasyGroup Holdings)
- 6.2.6 Enterprise Holdings Inc.
- 6.2.7 Europcar Mobility Group
- 6.2.8 The Hertz Corporation
- 6.2.9 Localiza Rent a Car SA
- 6.2.10 Sixt Inc.
- 6.2.11 Zoomcar India Pvt. Ltd.
7 MARKET OPPORTUNITIES AND FUTURE TRENDS