Car Rental Market Set to Soar: Projecting USD 105.7 Billion by 2033 with a 2.6% CAGR

IMARC Group, a leading market research company, has recently released a report titled “Car Rental Market Size, Share, Trends and Forecast by Booking Type, Rental Length, Vehicle Type, Application, End User, and Region, 2025-2033”. The study provides a detailed analysis of the industry, including the global car rental market share, trends, size, and industry trends forecast. The report also includes competitor and regional analysis and highlights the latest advancements in the market.

Report Highlights:

How Big Is the Car Rental Market?

The global car rental market size reached USD 83.9 Billion in 2024. Looking forward, IMARC Group expects the market to reach USD 105.7 Billion by 2033, exhibiting a growth rate CAGR of 2.6% during 2025-2033. North America currently dominates the market, holding a car rental market share of over 37.8% in 2024. The market is experiencing steady growth driven by the escalating need for cost-effective and short-term mobility options, the expanding middle class, and continuous technological advancements, particularly the integration of smart technologies and online platforms. Request to Get the Sample Report: https://www.imarcgroup.com/car-rental-market/requestsample

Market Key Highlights:

✔️ Strong market expansion driven by rising travel demand and urban mobility trends

✔️ Growing preference for flexible, short-term, and subscription-based rental options

✔️ Surge in digital bookings, contactless rentals, and app-based service models

The Future of the Car Rental Market

The global car rental market is undergoing a profound transformation, driven by shifting consumer expectations, technological innovation, and growing environmental awareness. By 2025, the demand for flexible, convenient, and cost-effective mobility solutions is projected to increase significantly. This growth is fueled by rising business and leisure travel, rapid urbanization, and a gradual move away from traditional car ownership models.

Technology is at the forefront of this evolution. Digital platforms are revolutionizing the rental experience through mobile bookings, contactless check-ins, real-time vehicle tracking, and personalized service offerings. These innovations are streamlining operations while enhancing customer convenience.

Simultaneously, sustainability is becoming a key market driver. Rental companies are progressively electrifying their fleets, introducing electric and hybrid vehicles to meet eco-conscious consumer demands and comply with environmental regulations. As climate concerns intensify, sustainable mobility is emerging as a core competitive advantage.

The market is also seeing the rise of subscription-based rental models, offering a flexible alternative to ownership. These services cater especially to urban consumers and younger demographics who value access and convenience over long-term vehicle commitments. Subscription packages, often including insurance, maintenance, and roadside assistance, are reshaping the industry’s traditional business model.

As the market continues to evolve, rental providers that embrace innovation, digital transformation, and sustainability will be best positioned for long-term success. The outlook for the car rental industry is highly promising, with strong growth potential anchored in adaptability and customer-centric strategies.

Market Dynamics of the Car Rental Industry

• Shift Toward Sustainable Mobility Solutions

Environmental sustainability is rapidly becoming a cornerstone of the car rental industry. With increasing consumer awareness and regulatory pressure, rental companies are accelerating the integration of low-emission vehicles—primarily electric and hybrid models—into their fleets. By 2025, sustainability is expected to be a key differentiator, influencing both customer decisions and compliance requirements.

To support this transition, companies are investing in EV infrastructure, such as on-site charging stations, and forming strategic partnerships with electric vehicle manufacturers. Collaborations with local governments to promote clean transportation are also gaining traction. As travelers become more environmentally conscious, demand is rising for greener rental options, compelling companies to reconfigure their fleet strategies to reflect both customer preferences and climate goals.

• Rise of Technology-Driven Services

Digital transformation is reshaping every facet of the car rental experience. Consumers now expect intuitive, on-demand services akin to those offered by ride-sharing platforms. In response, rental companies are deploying mobile apps, AI-driven tools, and cloud-based platforms to enhance the efficiency, personalization, and convenience of their offerings.

By 2025, digital-first service models will likely dominate the industry. Technologies like artificial intelligence, machine learning, and predictive analytics are being used to optimize pricing, forecast demand, and tailor services to individual users. Features such as digital ID verification, automated customer support, and contactless vehicle access are quickly becoming standard. Companies that fully leverage these innovations will gain operational efficiencies, stronger customer loyalty, and a clear competitive edge.

• Growth of Subscription-Based Rental Models

The emergence of subscription-based rental models is redefining traditional notions of car usage. These models offer an all-inclusive, flexible alternative to vehicle ownership—appealing particularly to urban residents and younger consumers who prioritize convenience and mobility over long-term commitments.

Under this model, users pay a monthly fee that typically covers the vehicle, insurance, maintenance, and other services, simplifying access to personal transportation. By 2025, subscription models are expected to capture a growing share of the market, as rental companies introduce tiered plans tailored to diverse user needs—from daily commuters to occasional drivers.

This shift reflects broader cultural and behavioral trends that favor flexibility, simplicity, and digital access. For rental providers, expanding into subscription services represents both a growth opportunity and a pathway to align with the evolving expectations of modern consumers.

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Car Rental Market Report Segmentation:

By Booking Type:

• Offline Booking
• Online Booking

Family travelers dominate the market, as they typically opt for comprehensive travel insurance that covers multiple members and a wide range of potential risks during their trips.

By Rental Length:

• Short Term
• Long Term

The short-term segment held the largest market share, driven by strong demand for car rentals for business travel, weekend trips, and other short-duration needs.

By Vehicle Type:

• Luxury
• Executive
• Economy
• SUVs
• Others

Luxury emerged as the leading segment, driven by the preference of high-income individuals and travelers for premium vehicles that offer superior comfort, status, and a more refined travel experience.

By Application:

• Leisure/Tourism
• Business

The leisure and tourism segment holds the largest market share, driven by the high number of tourists and vacationers who prefer renting cars for convenient and flexible travel.

By End User:

• Self-Driven
• Chauffeur-Driven

The self-driven segment held the largest market share due to its enhanced flexibility, privacy, and control over travel schedules, making it a preferred choice for both leisure and business travelers.

Regional Insights:

• North America
• Asia Pacific
• Europe
• Latin America
• Middle East and Africa

North America leads the market due to its robust tourism sector, high levels of disposable income, and well-established transportation infrastructure that facilitates car rental services.

Competitive Landscape with Key Players:

The competitive landscape of the car rental market size has been studied in the report with the detailed profiles of the key players operating in the market.

Some of These Key Players Include:

• Avis Budget Group, Inc.
• Carzonrent India Private Limited
• Eco rent a car
• Enterprise Holdings, Inc.
• Enterprise Rent-A-Car
• Europcar
• Localiza
• Sixt SE
• The Hertz Corporation

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Key Highlights of the Report:

• Market Performance (2019-2024)
• Market Outlook (2025-2033)
• Market Trends
• Market Drivers and Success Factors
• Impact of COVID-19
• Value Chain Analysis

If you need specific information that is not currently within the scope of the report, we will provide it to you as a part of the customization.

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IMARC Group is a leading market research company that offers management strategy and market research worldwide. We partner with clients in all sectors and regions to identify their highest-value opportunities, address their most critical challenges, and transform their businesses.

IMARC’s information products include major market, scientific, economic and technological developments for business leaders in pharmaceutical, industrial, and high technology organizations. Market forecasts and industry analysis for biotechnology, advanced materials, pharmaceuticals, food and beverage, travel and tourism, nanotechnology and novel processing methods are at the top of the company’s expertise.

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