Global Car Rental Market Size, Share, Growth and Trend Analysis Report, 2032

Summary
Market Landscape
Methodology
Table of Content

Global Car Rental Market Size, Share & Growth and Trend Analysis Report, By Vehicle Type (Economy, Luxury, SUVs, and Others), By Booking Type (Online, Offline), By End User (Business and Leisure), By Rental Duration (Short-term, Long-term), and By Region (Asia Pacific, Europe, North America, Latin America and Middle East & Africa) and Forecasts 2024 – 2032

The Global Car Rental Market involves the provision of vehicles, typically ranging from a few hours to several weeks, without ownership by the renter. Vehicles are rented by individuals or businesses from rental agencies or platforms, rather than being personally owned. The market caters to leisure and business travelers and includes a variety of vehicle types, such as economy, luxury, and SUVs. It is driven by factors like tourism, business travel, and the demand for flexible transportation options.

The Global Car Rental Market was valued at approximately USD XX billion in 2024. It is projected to grow to USD XX billion by 2032, with an estimated compound annual growth rate (CAGR) of around 8% from 2025 to 2032.

Industry Trends

The global car rental market forms a dynamic mobility service ecosystem, offering temporary vehicle access to individuals and businesses across various rental durations and vehicle categories. Catering to a wide range of transportation needs from short-term leisure and business travel to long-term corporate leasing and subscription-based models, the market operates through both traditional brick-and-mortar outlets and digital platforms.

As an integral part of the modern transportation landscape, the industry provides flexible mobility solutions, effectively bridging the gap between public transit and vehicle ownership.

The car rental industry has experienced significant growth in recent years, fueled by the rise in tourism, business travel, and the growing popularity of mobility-as-a-service solutions. Car rental services cater to a wide range of needs, including business trips, leisure travel, airport transfers, and temporary vehicle replacement.

To meet diverse customer demands, rental companies are expanding their fleets with various vehicle options and integrating digital technologies to improve customer satisfaction and streamline operations.

However, the market faces challenges such as high operational expenses, vehicle maintenance costs, and competition from ride-sharing platforms, which may hinder its growth.

Industry Expert’s Opinion

Abdullah Al Moosa, Chairman of Al Moosa Enterprises

“Our journey began over 50 years ago with a vision to introduce innovative concepts to the UAE, including establishing the nation’s first-ever car rental business at a time when the idea of rental cars was virtually unknown. With this pioneering spirit and our newly revamped facilities, we remain steadfast in our commitment to shaping a brighter future. By continuing to innovate and adapt to the ever-evolving needs of our employees, associates, and, most importantly, our customers, we aim to uphold our legacy of excellence and progress.”

Gaurav Aggarwal, Founder and CEO of Savaari Car Rentals

“By partnering with local service providers, rental companies can offer an expanded network of pick-up and drop-off locations, making vehicle access more convenient for customers. This growth is further supported by investments in technology-driven solutions, such as mobile apps and user-friendly online platforms, which simplify the process of booking and managing rentals, ensuring a seamless experience for users.”

TT Consultants’ Perspective

The future perspective of the global car rental market is poised for significant transformation, driven by advancements in technology, changing consumer preferences, and evolving environmental concerns. The increasing adoption of electric vehicles and sustainable practices is expected to reshape the market, as consumers become more eco-conscious and demand greener transportation options.

Autonomous vehicles may also play a role in the future, potentially reducing the need for human-driven rentals and offering new business models for car-sharing services. The rise of digital platforms will continue, with mobile apps and online booking systems becoming more sophisticated, offering greater convenience and personalized experiences. Additionally, peer-to-peer car rental services are likely to grow, providing more affordable and flexible rental options.

As urbanization increases and car ownership declines, shared mobility services such as car subscriptions and ride-hailing will complement the traditional rental model, further diversifying the market. Overall, the car rental industry will increasingly align with evolving trends in sustainability, convenience, and innovation, ensuring a dynamic and competitive future.

Market Segmentation

1. By Vehicle Type (Economy, Luxury, SUVs, and Others)

The economy car segment held the largest revenue share of XX% in 2024. This dominance can be attributed to the cost-effectiveness and fuel efficiency of economy vehicles, making them popular among both business and leisure travellers.

The SUV segment is expected to experience the highest CAGR of XX% between 2025 and 2032, driven by increasing preference for spacious vehicles among families and travellers with substantial luggage requirements.

2. By Booking Type (Online and Offline)

The online booking segment held the largest revenue share of XX% in 2024. The high market share is driven by the convenience of digital platforms, mobile applications, and the ability to compare prices and vehicle options easily.

The segment is expected to maintain its dominance during the forecast period, supported by technological advancements in booking platforms and increasing smartphone penetration globally.

Online bookings, made through websites or mobile apps, have gained significant popularity due to the convenience, real-time availability, and often discounted rates they offer. This segment has grown rapidly with the rise of digital platforms and the increasing demand for flexibility in travel arrangements.

On the other hand, offline bookings, made through traditional methods such as direct visits to rental offices or phone calls, remain prevalent among certain customer groups, particularly older travellers or those in areas with limited internet access, though this segment is gradually declining as online options become more dominant.

3. By Source (Conventional, Organic)

The business segment dominated the global car rental market in 2024 with USD XX bn and is projected to maintain its leading position throughout the forecast period. This segment's growth is driven by increasing corporate travel, expanding global business operations, and the need for flexible mobility solutions.

On the other hand, the leisure segment is anticipated to show significant growth, supported by rising disposable incomes and growing tourism activities worldwide.

4. By Rental Duration (Short-term and Long-term)

The short-term rental segment dominated the global car rental market in 2024 with a share of XX%, driven by tourism activities and business travel requirements. However, the long-term rental segment is expected to grow at a faster rate during the forecast period, supported by increasing adoption of car leasing solutions by corporations and the rising popularity of subscription-based car rental services.

5. By Region (North America, Europe, Asia Pacific, Latin America, Middle East & Africa)

North America led the global car rental market with a value of USD XX billion in 2024 and is projected to maintain its dominant position throughout the forecast period. The region's strong performance is attributed to well-established tourism infrastructure, high business travel volume, and the presence of major car rental companies.

The Asia Pacific region is expected to experience the highest CAGR of XX% during the forecast period, driven by rising disposable incomes, expanding tourism sector, and increasing business activities in countries like China and India.

Competitive Scenario

The competitive scenario in the global car rental market is shaped by a combination of large multinational companies, regional players, and emerging peer-to-peer platforms. Major players dominate the market by offering a wide range of vehicle options, extensive networks of rental locations, and loyalty programs.

Meanwhile, peer-to-peer car rental services introduce competition by allowing individuals to rent out personal vehicles, often at lower prices with unique offerings. The market is also increasingly driven by the rise of online booking platforms, where convenience, customer experience, and competitive pricing are key differentiators.

Regional players further intensify competition by catering to specific local needs and preferences. Additionally, sustainability initiatives, such as the incorporation of electric vehicles, are becoming important competitive factors as companies strive to attract eco-conscious consumers.

Key market players include Enterprise Holdings, Hertz Global Holdings, Avis Budget Group, Sixt SE, and Europcar Mobility Group. These companies are focusing on fleet expansion, technological integration, and strategic partnerships to strengthen their market position. Other prominent players include Budget Rent a Car, National Car Rental, Alamo Rent A Car, Dollar Rent A Car, and Thrifty Car Rental.

Recent Developments and Strategic Activities:

In February 2024, Hertz Global Holdings announced a significant expansion of its electric vehicle fleet, adding various EV models to meet growing customer demand for sustainable transportation options.
In January 2024, Avis Budget Group introduced a new contactless rental service across major locations, leveraging digital technologies to streamline the rental process.
In December 2023, Sixt SE expanded its presence in the Asia Pacific region through strategic partnerships with local operators in key markets.
In November 2023, Europcar Mobility Group launched a new subscription-based rental service targeting long-term corporate clients.