- The Rent-a-Car market has seen a significant increase to 779 thousand units from January to June this year, compared to the same period last year, representing a growth of 24%.
- In 2019, the total rental market was 1,111 thousand vehicles in the same period.
- In 2024, only 30 thousand EVs have been registered, which is 10 thousand units fewer than in 2023. Low customer demand and operational difficulties make EVs unpopular.
- The strongest growth comes from Stellantis, VAG and the Renault Nissan alliance.
You will have noticed that car rental prices are lower than they have been in previous years. This is a clear indication that the car market is returning to normal. There is no doubt that the rental market is back. In the first half of 2024, the number of rental car registrations in Europe has risen by 24% compared to the same period last year. While it has not yet returned to pre-covid levels, when over 1.1 million short-term rental vehicles were registered in 2019, the market is on its way back.
1 in 10 registered vehicles in Europe is a Rent-a-Car (RAC)
The reduction in supply during the pandemic and the war in Ukraine has resulted in a decline in rental firms’ access to vehicles. Given the difficult circumstances OEMs faced in managing their sales channels, they had to turn to private consumers and SMEs as alternative avenues for revenue generation. Now that supply has stabilised, there is a renewed focus on short-term rental providers, who can effectively optimise vehicle allocation.
Spain highest RAC share, UK highest growth in 2024
Spain is a major holiday destination with the highest rental penetration of the seven biggest markets. One in four vehicles ends up on the rental market. Spain is normally the fifth largest market in Europe, but in the rental market it is just behind Germany. There were 152 thousand rental registrations in the first half of 2024, compared to 190 thousand in Germany.
The UK saw the biggest growth with an impressive 111% year-on-year increase. It’s likely that some actual rental registrations have gone unnoticed in recent years. Many brands have been surprisingly inactive in the rental market, which is inconsistent with their operations in other countries.
Preferably not an electric vehicle please
The average rental car user does not appear to have a strong interest in driving an EV on holiday or business trips. A few points may indicate why
- Where will the car be charged, and what pass(es) will be required?
- What is the cost for charging the vehicle
- Range anxiety
- How to (quickly) refill the vehicle before returning it. (and in case this is not needed, how will the rental company deal with this)
For the Rent-A Car companies, the current low residual value makes the cars less popular. The high depreciation of the vehicle increases the rental price, which is further compounded by low customer demand.
The share of EVs among newly registered vehicles has dropped from 6.4% to 3.8% this year. This means that just under 30,000 electric vehicles have been registered as rentals this year. If it must be an EV, the Renault Megane E-Tech is the most popular model, followed by the Tesla Model Y.