Having declined by a third during 2020 as a result of both domestic and international restrictions on movement and the economic shock of the pandemic, retail current value sales of car rental (destination) will rebound during 2021 but remain well below their pre-pandemic peak. Demand will continue to be affected by the slow recovery in inbound international tourism and a weak domestic economy.
Launched in 2019, FlexClub initially operated as an online car rental marketplace that offered monthly fixed all-inclusive subscription fees to Uber drivers who could not afford to buy their own vehicles. The company also adopted a strategy of offering flexible contract terms as a unique selling point, alongside a reward system that allowed customers to earn discounts based on their driving behaviour.
Retail current value sales of car rental (destination) will continue to recover during 2022, when they will exceed their pre-pandemic (2019) level. They will continue to expand through the remainder of the forecast period, albeit at a diminishing pace.
International e-hailing services like Uber and Bolt will pose an increased competitive threat to car rental companies during the forecast. During early 2021, Chinese e-hailing service DiDi launched a pilot programme in Gqeberha to gauge consumer interest in South Africa.
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Car rental covers the short-term rental of passenger vehicles for self-drive including small vans by both business and leisure users, whether from the airport or downtown locations. Small vans up to one tonne are included. For longer than average rental periods, eg rental of one month, provided the rental is sourced from the short-term rental fleet, this transaction is included. Car rental value covers the price of car hire to the consumer. Ancillary revenues are included, such as the hire of baby car seats, GPS navigation systems, optional roadside assistance services and collision and damage waivers. Volume is provided by the number of car hire transactions, fleet size and number of car rental operators. In underdeveloped markets, car rental companies offer chauffeur-driven cars. Most people prefer these options, due to unfamiliarity with the roads. Euromonitor International includes chauffeur-driven cars in car rental, when they concern car rental companies such as Hertz or Avis, which offer a chauffeur-driven service as an additional option. Car rental covers sales to inbound tourists and domestic tourists. i.e. from a destination point of view (also known as point of supply). For example, if a US citizen books a car rental service in France via the US offices of Hertz, the sales are attributed to Hertz France. The same applies for online sales. Car rental excludes long-term leasing, commercial vehicles, trucks and motorbikes and local car sharing schemes.
See All of Our DefinitionsThis report originates from Passport, our Car Rental (Destination) research and analysis database.
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