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Kuwait Car Rental and Leasing Market Forecast to 2020, Demand For Car Leasing to Drive Growth: Ken Research

08-17-2016 01:10 PM CET | Logistics & Transport

Press release from: Ken Research Pvt Ltd

Kuwait Car Rental and Leasing Market Forecast to 2020, Demand

How the Kuwait Car Rental andLeasing Market Is Positioned?

Kuwaitcar rental market showcased a significant growth in the previous years. In2015, Kuwait car rental market was valued at USD ~ million as compared to therevenue in 2010 which was USD ~ million. The growth in the revenue has beenlargely due to an inclination in the expenditure on travel by the people in thecountry, primarily caused by rising number of foreign visitors. In 2014, thecountry has witnessed an inclination of ~% in the car rental market in terms ofrevenue as compared to 2013. In 2010, the car rental industry had witnessedrevenue of USD ~ million which had further enhanced to USD ~ million in 2011and USD ~ million in 2012.

Investmentby government to support tourism such as development of Kuwait InternationalAirport to reach a lodging capacity of 25 million passengers per year is alsoproviding a boost to tourism and thus directly impacting the car rental marketpositively.

Significant rise in revenues have been witnessed for the carrental companies operating in the country due to diversification in theirbusiness opportunities in terms of new rental segments and business line. Majormultinational car rental companies such as Hertz has enhanced their business byappointing local companies such as Transworld Company as its GSA (General SalesAgent) in Kuwait in efforts to increase the amount of outbound car rentalreservations from Kuwait. Over the years, Kuwait car rental market has grown ata CAGR of ~% from 2010-2015 reaching to USD ~ million in 2015.

Moreover,the tourism sector is also impacting the revenues of car rental companiesdirectly since most of the tourists opt for a car rental when they visitKuwait, this provides them the flexibility of enjoying the clean and developedroad infrastructure in the country with ability to stop at various places.

Which Segmentshave driven Kuwait Car Rental and Leasing Market?

Most of the off airport car rental is dominated by the longterm car leasing and hence only a limited revenue of chauffeur driven cars isobtained through the off airport car rental. On the other hand Chauffeur drivencar rental market has been dominated by the on airport car rental since most ofthe people which arrive at the airport opt for the chauffeur driven cars.

Kuwait has one of thebest road systems among the Middle East countries with widely available car rental facilities in the country.In 2015, around ~% of the revenues of the car rental companies have beengenerated through the rental of luxury cars that comprises of limousineservices along with large sized cars such as Ford Lincoln, Lexus ES 350 andothers. Around ~% of the revenues were generated from medium sized cars in thecountry in 2015. Expats and tourist that prefer to rent cars for duration of 3months-6 months usually prefer to rent small sized cars such as HyundaiVeloster, Mitsubishi Mirage, Nissan Micra and others.

Kuwait car rentalmarket has been segmented on the basis of types of clients (corporate/ workexpats or retail/ tourists) that prefer to rent cars or book cars for theirtravelling purpose. Since Kuwait is home to a large expat population fromvarious countries therefore car rental companies generate a major portion (~ %)of their revenues through corporate clients.

It has been observedthat around 60% of the GDP of the country comes from oil and gas sectoraccounting for 95% of Kuwait’s exports. These companies need rented vehicles(mostly commercial or the SUVs) to travel to the work sites and thus command ~%of the share in revenues. The construction industry is expected to indulge intoa series of projects, owing to increasing demand from the private sector.Expansion of the Kuwait’s International Airport and increased focus oninfrastructural projects to attain non-oil led growth are some factors leadingto growth of construction sector in the country leading to a revenue share of ~%.Other sectors such as trading companies require most of the commercial vehiclesto move their goods to and from ports to other parts in the country and thusprovide revenues worth ~% of the industry revenues.

What isthe Competition Scenario in Kuwait Car Rental and Leasing Market?

Competitionin the vehicle rental industry is primarily based on price, service quality ofcustomers, including utilization of booking systems and easiness of rental andreturn, accessibility of vehicles, dependability and domestic and internationaldistribution. In addition to this, competition in the market is also influencedby advertising, marketing and brand reputation.

Mostof the Kuwait car rental market is captured by local players in the countrywhich command a major share in the industry. All Mulla has dominated the marketfor rental cars in Kuwait with 25.2% share in the total fleet of the car rentalindustry in the country. Al Sayer and Safeena are other major players whichcommanded a fleet size of 14.3% and 8.4% respectively.

Foreignplayers such as Sixt, Europcar, Avis and others also have their rental stationsacross the country.

Apart from all the major players, the rest of the Kuwait carrental market is tapped by small and independent as well as internationalplayers.

What is the Future Outlook for Kuwait Car Rental and Leasing Market?

A major part of the population in Kuwait comprisesof work expatriates that usually prefer to rent and change their cars on afrequent basis due to the culture of Kuwaiti society that encourages people torecurrently change their vehicles so they will always be driving a new car ofthe newest model. Therefore, various new car rental companies are expected tointroduce facilities such as “operational rent”, “rent promising to buyprogram” and others in order to cater to the demand of the car rental companiesin the country. The market for car rental services is expected to enhance inthe country due to the expansion of construction contracts of KNPC (KuwaitNational Petroleum Company). The company plans to produce gasoline and diesel90 kilometers south of the capital. This is further expected to augment thework force and car rental business in the country since employees would need totravel from the city to the work locations and the way back.

The car rental market in Kuwait is expected toreach USD 292.2 million by 2020 in terms of revenues and ~ in terms of thefleet size. It is also expected that the growth would be led by the car leasingmarket covering more than ~% of the market.



CompaniesCited in the Report

Competitive Landscape

Companies Covered in the Report List of Companies

Kuwait Car Rental Al-Mullah

Al Sayer

Sefeena

Hertz

Sixt

Ousol

National

Payless

Budget



Key Factors Considered in the Report

§ Comprehensiveanalysis of the Kuwait Car Rental and Leasing Market and its segments

§ Listedmajor players and their positioning in the market

§ Identifiedmajor industry developments in last few years and assess the future growth ofthe industry

§ Governmentroles to understand the regulatory environment in each country

§ Comprehensiveanalysis of major segments in the Car Rental and Leasing Market in Kuwait

To know more on coverage, click on the linkbelow:

https://www.kenresearch.com/automotive-transportation-and-warehousing/automotive-and-automotive-components/kuwait-car-rental-leasing-market/42907-100.html



Contact:

Ken Research

Ankur Gupta, Head Marketing &Communications

query@kenresearch.com

+91-124-4230204

Ken Research provides bespoke industry intelligence, equity research reports and business consulting services on gamut of sectors across the globe.

Unit no - 27A, Tower B2, spaze I tech park sec 49 Gurgaon Haryana

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