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The Car Rental (Self Drive) Market is estimated to grow by USD 1,702.15 million between 2022 and 2027 accelerating at a CAGR of 35.8%. The growth of the self-drive online car rentals market depends on several factors, such as growing interest in self-driving vehicles, growth of the travel and tourism industry, and rise in disposable income and easy availability of autonomous car rentals.
This car rental (self drive) market research report extensively covers market segmentation by vehicle type (economy cars and luxury cars), mode of booking (offline and online), and geography (North America, Europe, APAC, South America, and Middle East and Africa). It also includes an in-depth analysis of drivers, trends, and challenges.
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The report includes the adoption lifecycle of the market, covering from the innovator’s stage to the laggard’s stage. It focuses on adoption rates in different regions based on penetration. Furthermore, the report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their growth strategies.
Global Car Rental (Self Drive) Market Customer Landscape
Our researchers analyzed the data with 2022 as the base year, along with the key drivers, trends, and challenges. A holistic analysis of drivers will help companies refine their marketing strategies to gain a competitive advantage.
The growing interest in self-driving vehicles is the key factor driving the global car rental (self drive) market growth. Self-driving vehicles (SDV) evolved from the pages of science fiction to a new urban reality. Several parties are already working on autonomous vehicle technology. The SDV has various features like single-lane driving on highways, autonomous driving, and autopilot in traffic jams. Nearly every major industry player, including original equipment manufacturers (OEMs), technology providers, suppliers, and regulators, has begun efforts to expand the reach of autonomous vehicle technology.
The idea of self-driving cars is also in line with the United Nations' goal of making cities safer, more resilient, more inclusive, and more sustainable. As technology takes over the driver's seat with minimal or no human intervention, intelligent traffic management is expected to make urban travel a seamless process for years to come. Like self-driving cars, robotaxis also have many customers. Hence, such factors are expected to increase the adoption of SDV, driving the growth of the self-drive online car rentals market during the forecast period.
The use of telematics in self-drive car rentals will fuel the global car rental (self drive) market growth. Telematics is a revolutionary technology used in self-driving car rentals. For self-driving car rentals, telematics provides real-time data on vehicle location, speed, and status. This data can be used by car rental companies to monitor vehicle mileage and fuel consumption and identify vehicle problems before they occur. In addition, the system allows car rental companies to ensure that drivers comply with traffic rules and adhere to rental policies. The integration of telematics technology into self-driving car rentals has also greatly improved the rental process. This has enabled landlords to provide customers with an automated check-in and check-out experience while simplifying the payment process. By using telematics, car rental companies can associate vehicle usage with payments, thus avoiding misunderstandings and ensuring billing transparency.
The tendency of car rental companies to overcharge for extra days or miles, a common problem encountered by traditional car rental companies, is greatly reduced by telematics technology. Additionally, telematics has enabled car rental companies to implement more reliable and secure theft recovery systems. With the help of GPS, car rental companies can track a car's location and remotely disable it, making it harder to steal. This increases the safety of the vehicle and, ultimately the safety of the renter. Therefore, the above factors are anticipated to drive the growth of the self-drive online car rentals market during the forecast period.
The high cost of self-driving car rental can majorly impede the growth of the self-drive online car rentals market. Renting a car for an expedition or vacation can be an exciting experience, but it can also be expensive, especially for a self-driving car. There are many factors driving the high cost of self-driving car rentals. One of these is the daily rental fee, which can be substantial. Prices vary by vehicle type, season, and location. Car rental prices tend to be significantly higher in popular tourist destinations and during peak travel times than in less traveled areas. Another factor contributing to high costs is compulsory insurance. Most car owners require renters to have comprehensive insurance, which can be expensive. This is because the insurance policy must cover not only the rental car but also the occupants, driver, and any other vehicle or person involved in the accident. Taxes and fees are another part of the rental cost.
Prices vary by location and may include airport taxes, local taxes, and registration fees. In addition, car owners sometimes charge additional fees for additional services such as GPS navigation system, child seat rental, and paid transponder. In addition, car rental companies often demand large security deposits. This security deposit will be held until the vehicle is returned. Finally, fuel costs are another variable that can have a big impact on the cost of self-driving car rentals. Fuel costs add up quickly, depending on the vehicle's fuel efficiency and mileage. Therefore, the above factors are expected to hinder the growth of the car rental (self drive) market during the forecast period.
Vendors are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the self-drive online car rentals market.
Aurora Innovation Inc: The company was founded in 2017 by leaders having decades of experience in the autonomous driving industry. It offers autonomous trucking and robotaxi services.
DriiveMe Ltd: The company provides car rental and carpooling services.
We also have detailed analyses of the market’s competitive landscape and offer information on 10 market vendors, including:
The report offers clients a deeper understanding of the market and its players through a combined qualitative and quantitative analysis of the vendors. The analysis classifies vendors into categories based on their business approach, including pure-play, category-focused, industry-focused, and diversified. Vendors are specially categorized into dominant, leading, strong, tentative, and weak to understand the dos and don’ts of business which in turn can help a client make the best decision.
The economy cars segment will contribute a major share of the market, as economy cars are the cheapest and most popular type of car rental, especially among budget travelers. The economy cars segment showed a gradual increase in market share with USD 135.97 million in 2017 and continued to grow by 2021. Economy cars have less equipment and smaller engine sizes, making them more fuel efficient and less expensive. Self-driving economy cars are in high demand among individuals and businesses as they provide a reliable and convenient means of transportation. One of the main benefits of self-driving economy cars is the savings in transportation costs as it doesn't require a human driver, and car rental companies can offer low rates, making it an attractive option for those looking to save money. In addition, self-driving cars are more economical than conventional cars, saving even more on fuel costs.
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Self-driving economy cars are also beneficial for individuals and businesses that travel short distances. Compact and easy to operate, it is ideal for maneuvering on busy roads and tight parking spaces. As a result, these cars are often rented for quick errands, short business trips, and weekend getaways. Demand for self-driving economy cars is expected to continue to grow as more and more people become interested in experiencing self-driving technology and its benefits, which will drive the growth of the economy car segment in global car rentals. It is likely to drive the growth of the market during the forecast period.
Offline booking allows customers to pre-book self-driving cars without relying on an internet connection. This is especially useful if users travel to remote areas or are in areas with poor internet connectivity. Customers simply provide information to the rental company by phone, email, or in person and the company handles the rest. The demand for offline bookings has surged in recent years as more and more customers seek that convenience. Rental companies are aware of this trend and are now offering this feature as part of their standard service. This makes the car booking process much easier and gives customers the freedom to rent a car anytime, anywhere. Thus, such factors are anticipated to drive the growth of the offline segment in the market during the forecast period.
North America is estimated to contribute 36% to the growth by 2027. Technavio’s analysts have elaborately explained the regional trends, drivers, and challenges that are expected to shape the market during the forecast period.
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North America dominates the car rental (self drive) market and accounts for a significant portion of industry revenue. The region's strong position is due to a number of factors, including the growing demand for autonomous vehicles, the presence of major market players, and supportive government regulations. Increasing demand for self-driving cars is one of the main drivers of the growth of the market in this region. Consumers are increasingly interested in experiencing the comfort and safety benefits of autonomous vehicles, especially on long journeys. This trend is boosting the demand for self-driving car rentals and may further drive the market in the coming years. In addition, North America's strong position in the car rental market is also due to the presence of important market players in the region. Leading car rental companies such as Hertz Global Holdings Inc. (Hertz) and SIXT SE (SIXT) are already offering self-driving vehicles in their fleets. In addition, automakers such as Tesla Inc. (Tesla), Ford Motor Co. (Ford), and General Motors Co. (General Motors) have also invested heavily in self-driving technology, with self-driving cars for rental purposes.
The COVID-19 pandemic increased the demand for rental cars due to personal transportation choices. Consumers preferred personal travel over public transport amid fears of catching coronavirus. This increased the demand for rental cars globally in 2020. With the lifting of lockdowns, the resumption of travel and tourism, and the start of vaccination campaigns from 1st half of 2021 onwards, the scenario did more favor to the market. Moreover, several advantages of self-driving cars over conventional vehicles contributed to the market growth during the forecast period. Therefore, the self-drive online car rentals market is expected to witness significant growth during the forecast period.
The car rental (self drive) market report forecasts market growth by revenue at global, regional & country levels and provides an analysis of the latest trends and growth opportunities from 2017 to 2027.
Car Rental (Self Drive) Market Scope |
|
Report Coverage |
Details |
Page number |
155 |
Base year |
2022 |
Historic period |
2017-2021 |
Forecast period |
2023-2027 |
Growth momentum & CAGR |
Accelerate at a CAGR of 35.8% |
Market growth 2023-2027 |
USD 1702.15 million |
Market structure |
Concentrated |
YoY growth 2022-2023(%) |
34.12 |
Regional analysis |
North America, Europe, APAC, South America, and Middle East and Africa |
Performing market contribution |
North America at 36% |
Key countries |
US, Japan, China, Germany, and France |
Competitive landscape |
Leading Vendors, Market Positioning of Vendors, Competitive Strategies, and Industry Risks |
Key companies profiled |
Aspark Holidays Pvt. Ltd., Aurora Innovation Inc., Autorent Car Rental LLC, Avis Budget Group Inc., DriiveMe Ltd., Enterprise Holdings Inc., Hertz Global Holdings Inc., Localiza Rent a Car SA, Primemover Mobility Technologies Pvt. Ltd., SIXT SE, Volkswagen AG, and Zoomcar India Pvt. Ltd. |
Market dynamics |
Parent market analysis, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID-19 impact and recovery analysis and future consumer dynamics, Market condition analysis for forecast period |
Customization purview |
If our report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
We can help! Our analysts can customize this market research report to meet your requirements. Get in touch
1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation by Vehicle Type
7 Market Segmentation by Mode of Booking
8 Customer Landscape
9 Geographic Landscape
10 Drivers, Challenges, and Trends
11 Vendor Landscape
12 Vendor Analysis
13 Appendix
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