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Saudi Arabia Car Rental Market Research Report, 2028

Saudi Arabia Car Rental Market Research Report, 2028

Actual Market Research 30-01-2023 57 Pages Figures : 5 Tables : 10 Region : MEA Country : Saudi Arabia Category : Automotive & Transport Transportation

The car rental market in Saudi Arabia is highly competitive, with several local and international companies operating in the market. n terms of future growth, the car rental market in Saudi Arabia is expected to continue to expand as the country continues to invest in infrastructure and tourism. The increasing number of domestic and international travelers is expected to drive demand for car rental services, and new technologies and business models are likely to emerge, further shaping the market. The government is attempting to increase investment in tourist infrastructure development, which is propelling the market in the region. With technology improving the private car rental experience for visitors, Saudi Arabia's car rental market is being bolstered by rapidly growing investments in the tourism sector, robust development in the logistics sector, and corporate players' growing preference for leasing cars. According to the research report, "Saudi Arabia Car Rental Market Research Report, 2028," published by Actual Market Research, the market is anticipated to add USD 1.29 billion by the end of 2028. Economy cars had the largest market share in the car rental market. One of the most important factors to consider when renting a car is its fuel economy as it has an effect on operating costs. Because of the low maintenance and procurement costs, most market players prefer economy cars for car rental services. Furthermore, economy cars are compact in nature and provide adequate comfort to the passengers. A significant increase in the number of people travelling for business and pleasure across the country is fueling demand for car rental services and propelling the industry's growth. Employees travelling to Saudi Arabia for business purposes increase the demand for Saudi Arabia car rentals in order to become acquainted with the location and business details. Rising internet penetration across developing as well as developed countries has further helped companies in the market capture a larger customer base with the help of dedicated mobile apps for the convenience of customers. The availability of a broader range of rental car types, such as SUVs and MUVs, increases demand for Saudi Arabia car rental.The convenience of booking cars offline by visiting car rental outlets or online through a website or app has increased the Saudi Arabia car rental market's share. Saudi Arabia is a well-known pilgrimage destination, with holy sites such as Mecca and Medina attracting large crowds during the Eid Al-Fitr and Eid Al-Adha festivals. As a result, the country receives approximately 16 million visitors per year, the majority of whom arrive during Ramadan. As a result, religious tourism accounts for the vast majority of tourism in the country. The demand for car rentals in Saudi Arabia has been steadily increasing, particularly among local players in the Middle East region. Hertz Corporation, Sixt Corporation, Avis Corporation, and Europcar are a few of the major players. Tourism contributed approximately 9% of Saudi Arabia's GDP of approximately USD 65 billion, according to the WTTC. The majority of visitors to the country come from Asia and neighboring Middle Eastern countries. The growth of the car rental market is encouraged by the country's stringent government legislation on car purchase and driving. Notably, tourists from Middle Eastern countries visit during Ramadan. Renting a car is preferred by people from Bangladesh, Pakistan, Indonesia, Yemen, and Egypt. Furthermore, the country recently lifted a ban on women driving vehicles. This decision enabled many women to drive and helped the car rental market grow by leaps and bounds, as many women with valid driving licenses could now access rented cars on their own. The total number of branches of rental car offices that worked with the unified e-contracts of car rental were approximately 2,891 offices of approximately 794 establishments working in the rental car sector in Saudi Arabia across 81 cities and governorates. The total number of cars used in the sector was approximately 247,204, with an average daily contract exceeding 13,000 e-contracts. Rent a Car and Uber are the leading mobility start-ups, with the company's app allowing you to rent a vehicle of your choice and have it delivered to your door. Telgani, which was founded in 2018, was founded on this premise. As a business model, it appears to be uniquely tuned to the means and expectations of wealthy Saudi customers, which may explain why the company has yet to expand beyond its borders. Car rental services are used by both tourists and locals for daily commuting. As the number of companies establishing themselves in Saudi Arabia grows, so does the population of office workers, and the demand for car rental services grows even faster. The major factors driving the growth of car rental services in the country are shifting consumer preferences away from traditional lifestyles and towards the use of technologically advanced personal vehicles, backed by an increase in disposable income. Furthermore, as part of Saudi Arabia's Vision 2030, the government encourages private organisations to establish offices in the country. The demand for corporate rentals and leases is expected to rise as a result. The Kingdom of Saudi Arabia intends to discontinue doing business with corporations and commercial organisations with regional headquarters outside the Kingdom. Beginning January 1, 2024, the halt will apply to government-owned agencies, institutions, and funds. Furthermore, in order to capture the growing market, some market players are increasing their fleet size with the latest models, forming new partnerships, and raising funds from investors, while others are focusing on collaborations and acquisitions to expand their service offerings in the country. For example, in January 2022, ekar, the Middle East's largest personal mobility company, activated car subscriptions across Saudi Arabia in collaboration with some of the country's largest car rental companies. Aljomaih Auto Rental (Ajar), a Saudi Arabian franchisee of Enterprise Holdings' rental brands, announced in June 2021 that it has begun purchasing new vehicles to meet rising demand. In Saudi Arabia, the company's fleet increased by 27% year over year to 5,700 vehicles. The SUV segment has been rapidly expanding, increasing its market share, as most tourists prefer to rent an SUV for family outings because it can accommodate more people and has more luggage space. The car rental market in the country is directly related to automotive market trends. To stay ahead of their competitors, service providers must include the most recent SUVs in their fleet if SUV sales increase. Recent events, however, such as Saudi government officials relaxing the rules governing the purchase of SUVs seating seven passengers, Expats in Saudi Arabia can now buy a 7-passenger SUV without restriction or compulsion. These incidents are expected to encourage consumers to buy SUVs while also limiting market growth. SUVs are expected to grow in recent years, with various startups offering subscription-based cars and key players focusing on capturing rising market share by adding to the SUV fleet. Similarly, Udrive intends to expand its presence in Saudi Arabia. For example, in August 2022, Udrive, the UAE-based dedicated pay-per-minute and daily car rental platform, announced its expansion into Saudi Arabia. The new operations will meet the growing demand from residents, tourists, students, and startups in the kingdom. Considered in this report • Geography: Saudi Arabia • Historic year: 2017 • Base year: 2022 • Estimated year: 2023 • Forecast year: 2028 Aspects covered in this report • Saudi Arabia Car Rental market with its value and forecast along with its segments • Various drivers and challenges • On-going trends and developments • Top profiled companies • Strategic recommendation By car Type • Luxury car • Executive car • Economy car • Sports utility vehicle (SUV) car • Multi utility vehicle (MUV) car By application Type • Leisure/Tourism • Business The approach of the report: This report consists of a combined approach of primary as well as secondary research. Initially, secondary research was used to get an understanding of the market and listing out the companies that are present in the market. The secondary research consists of third-party sources such as press releases, annual report of companies, analyzing the government generated reports and databases. After gathering the data from secondary sources primary research was conducted by making telephonic interviews with the leading players about how the market is functioning and then conducted trade calls with dealers and distributors of the market. Post this we have started doing primary calls to consumers by equally segmenting consumers in regional aspects, tier aspects, age group, and gender. Once we have primary data with us we have started verifying the details obtained from secondary sources. Intended audience This report can be useful to industry consultants, manufacturers, suppliers, associations & organizations related to car rental industry, government bodies and other stakeholders to align their market-centric strategies. In addition to marketing & presentations, it will also increase competitive knowledge about the industry.

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