GCC Car Rental Market Overview and Outlook
An increase in expat population and growing trend of affordability among millennials were the key factors that drove growth in the car rental market in the major GCC countries over the past several years
Other contributors to growth include rising inflow of international tourists, improvement in the overall business environment, etc.
However, growth slowed down in the last couple of years, mainly attributable to a decline in economic activity which had a negative impact on household incomes and business environment
The overall car rental market is segmented into rental model and lease model, depending on the duration. The car leasing segment accounted for the higher share in terms of the fleet size, though in value terms it’s much lower than the car rental segment
In terms of the industry structure, it’s a relatively concentrated market with the large players accounting for a majority share on account of wider geographic reach, larger fleet size, etc.
Key players operating in the GCC car rental segment include global companies such as Avis, Carzonrent, Europcar and Hertz; and regional players such as Careem, Al-Mulla and Al Sayer. There are also newer players such as Udrive which is the first car sharing provider in the Middle East that provides car rental by the minute.
Going forward, the market is likely to grow at a robust pace in the next five years led by macro and micro factors; however, in the near term, growth will slow down significantly on lower tourist inflows and business travelers owing to the COVID-19 pandemic
Market Growth Drivers and Trends
Most primary factors driving the GCC car rental market are:
- Increasing number of tourists
- Declining oil prices and lower per capita income
- Growing preference for short-term rentals
- Rising usage of smartphones and growth in the number of users aged between 25 and 34 years, who prefer to book vehicle rentals through online channels
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Potential Challenges
Key factors likely to restrain or slow down growth in the car rental market in GCC include:
- Operating challenges including maintenance & repair work
- Regulatory challenges
- Seasonality of the business
GCC Car Rental Market Research Scope
The base year of the study is 2019, with forecast done up to 2024. The report provides a detailed assessment of the GCC car rental market, including insights on the market dynamics, key drivers, challenges, regulations impacting the market, and value chain analysis.
We have also estimated the current market size in GCC and by countries, rental type, car type, 5-year outlook of the market, factors driving growth along with regional and country-level insights and trends
The study also presents a thorough analysis of the competitive landscape, considering the market shares of the leading companies. These provide the key market participants with the necessary business intelligence and help them understand the future of the GCC car rental market.
Author – Prasanth R Krishnan
Associate Director – Operations
Connect to the author of the report at reports@avalonglobalresearch.com or contact us at https://www.agrknowledge.com/contact-us