GCC Car Rental Market Report and Forecast 2032

GCC Car Rental Market Insights & Analysis

The GCC Car Rental Market was USD 882.2 Million in 2023 and further is projected grow at a CAGR of around 13.8% during the forecast period, i.e., 2024-32, and the market size is further forecast at USD 2.55 through 2032.  The market growth is attributable to the growing influx of tourists across the regional nations and an upsurge in the demand for rental cars to travel places.

Car rental organizations provide vehicles for a convenient fee, usually for a specified duration, which can range from a few hours to several days or even weeks. Hence, renting cars has gained popularity in the GCC markets owing to its hassle-free nature, low maintenance requirements, and affordability. The market in the regional nations, particularly in countries like the United Arab Emirates (UAE) & Oman, has seen noteworthy expansion driven by their expanding economies.

Furthermore, the market is benefiting from a heightened public awareness of a wide range of rental options, including luxury & eco-friendly vehicles, which is escalating the customer base & supporting industry growth. The expansion of urban infrastructure, the rising need for transportation in business hubs, and local car rental platforms that offer personalized rental solutions tailored to individual needs are contributing to enhancing the market size.

Government initiatives focused at promoting tourism and business travel, along with regulations that ensure quality & safety in rental practices, are reinforcing the market. Moreover, the growing preference for flexible commuting options, along with the strategic placement of car rental services at key locations like airports, hotels, and commercial centers, is accelerating market growth.  Also, customized rental packages, long-term leasing options, and significant investments in customer service excellence create a positive outlook for the GCC Car Rental Market in the forthcoming years.

GCC Car Rental Market Dynamics

• Increasing Tourist Inflow to Drive the Market Growth

The GCC region boasts numerous tourist attractions, including iconic landmarks, cultural sites, and natural wonders. Tourists often favor the suitability and flexibility provided by car rentals, enabling them to explore these attractions at their preferred pace. Renting a car grants tourists the liberty to travel independently, visit less-traveled destinations, and enjoy a hassel-free travel experience.

Furthermore, the proximity of GCC nations facilitates multi-country exploration during tourists' visits, and car rental services facilitate border crossings, permitting them to immerse themselves in the region's diverse cultures and landscapes. As a result, the surge in the number of tourists looking to explore various GCC countries and engage in business activities stands as a significant driving force behind the growth of the GCC Car Rental Market.

• Mounting Investments in Public Transport to Hinder the Industry Expansion

The governments of the countries across the GCC region have been making substantial investments in augmenting the public transportation infrastructure, intended to improving the lifestyle in urban areas, and establishing a global logistics hub. The government's infrastructure projects include the construction of trains, metro lines, and public transport buses, all of which contribute to better road connectivity in several countries like the UAE, Saudi Arabia, Qatar, etc.

Thus, the advancement of robust public transportation infrastructure has led a significant portion of consumers, especially those seeking affordable transportation options, to shift from car rental to public transportation services, thereby hindering the growth of the GCC Car Rental Market.

GCC Car Rental Market Segment-wise Analysis

By Booking Channel:

• Online
• Offline

The Online Booking Channel is estimated to grow at a substantial pace, holding the potential share of the GCC Car Rental Industry during the forecast period. The trend of renting cars online via numerous apps due to its one-click process is prompting the adoption of car rental services.

App developers have been creating mobile rental applications that incorporate advanced booking features, offering users with increased vehicle options and the ability to compare rental prices within a single platform. For instance, Ejaro launched a licensed car-sharing application in Saudi Arabia in August 2020. This app serves as a platform connecting car owners with individuals seeking to rent vehicles online.

By Application:

• Leisure
• Commercial

In recent years, the Commercial sector captured a significant share of the GCC Car Rental Market and is presumed to follow the similar trend in the forthcoming years as well. This dominance can be attributed to the rapid expansion of the service industry in the region, coupled with proactive initiatives by the governments of the countries to encourage foreign direct investment (FDI). These factors have significantly contributed to the augmented demand for rental cars for business-related transportation requirements.

Furthermore, the presence of domestic & international organizations in the region has grown steadily, engrossed by favorable macroeconomic conditions, such as a skilled workforce, ease of establishing & terminating operations, and business-friendly policies. Consequently, this has further fueled the demand for rental cars to facilitate mobility services for their employees.      

Country Projection of the GCC Catering Services Industry

The GCC Car Rental Market is geographically diversified, covering:      

• Saudi Arabia
• The UAE
• Kuwait
• Qatar
• Bahrain
• Oman

The UAE is anticipated to be the dominant country in the GCC Car Rental Market in the coming years. The UAE Car Rental Market is significantly influenced by both tourists & corporate clients. The government's initiatives to promote technology-based platforms and customer-oriented services have played a pivotal role in driving the market forward. In the UAE, airports are typically situated outside city limits, making car rental services highly profitable, especially in cities like Dubai & Abu Dhabi. The nation's growing economy, coupled with the convenience of on-demand car rentals has made car rental services more accessible and sustainable.

Moreover, the mounting population, particularly in major cities, has led to a shortage of space, rising fuel prices, and taxes. These factors have encouraged individuals to seek more sustainable transportation options. Hence, there is a growing trend towards environmentally friendly vehicles, including electric vehicles (EVs), as the UAE Car Rental Market shifts towards eco-friendly solutions.                                                                                               

What Does Our GCC Car Rental Market Research Study Entail?

• GCC Car Rental Market Research Report highlights the forecast growth rate or CAGR by anticipating the market size & share.
• The market analysis puts light upon the primary industry trends, driving aspects, potential opportunities, growth challenges, and other major factors.
• GCC Car Rental Market Research Report entails details about the most critical shifts in market share in the prominent regions.
• Considering the statistics & the developments by the primary market competitors, our report also strives to demonstrate the most sought-after strategies of the key players.