Car Rental Market to Record USD 277.2 Billion by 2032, Fuelled by Corporate Travel and Tourism Demand | PMR

Market Overview and Growth Trajectory

The global car rental market is experiencing robust expansion driven by rising travel activities and increasing demand for flexible transportation solutions. Estimated at US$ 140.4 billion in 2025, the market is projected to reach US$ 277.2 billion by 2032, registering a CAGR of 11.2% during the forecast period. The steady rise in international tourism, business travel, and intra-city mobility needs is significantly fueling this upward trend.

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Technology-enabled services, such as online booking platforms, GPS tracking, and app-based customer support, are further transforming the market. In 2025, economy cars are forecast to lead the market with a 33.5% share due to their cost-efficiency. North America emerges as the leading regional market, accounting for 37.4% of the total revenue, driven by high tourist influx, extensive corporate travel, and personalized rental packages for niche customer segments like students and solo travelers.

Key Highlights from the Car Rental Market Report

• Economy cars are forecast to command a 33.5% share in 2025, driven by affordability.
• Online booking channels will dominate with a projected 72.8% market share in 2025.
• North America is expected to account for 37.4% of the market by 2025.
• Corporate clients prefer short-term rentals for flexible mobility solutions.
• Key players are partnering with travel agencies and hotels to expand in emerging regions.
• Enhanced fleet management and personalized offerings are becoming strategic priorities.

Market Segmentation Overview

The car rental market is segmented based on vehicle type, booking mode, rental duration, and end-user type. Among vehicle types, economy cars dominate due to their accessibility and suitability for budget-conscious consumers. Luxury, SUVs, and executive cars cater to niche segments like corporate clients and affluent travelers, while electric vehicle (EV) rentals are gaining popularity amid sustainability trends.

In terms of booking mode, online platforms have revolutionized the rental experience, with nearly three-fourths of customers expected to book digitally by 2025. This is due to ease of comparison, instant confirmations, flexible payment options, and integration with other travel services. Mobile apps and web portals now offer seamless end-to-end solutions, from reservation to vehicle return.

Regional Insights

North America continues to lead the global car rental market, supported by a mature transportation infrastructure and a high rate of digital adoption. Tourist hotspots in the U.S. and Canada, along with strong business travel networks, further drive demand. Companies in this region are focusing on fleet upgrades and customer-centric service packages.

In Asia Pacific, the market is witnessing rapid growth, led by expanding middle-class populations, increased domestic tourism, and aggressive digitalization. Countries like India, China, and Southeast Asian nations are seeing a rise in app-based car rental services and partnerships with travel aggregators, positioning the region as a future growth engine.

Market Drivers

The primary growth driver is the surge in global leisure and business travel, which is fueling demand for temporary mobility. Coupled with changing consumer preferences toward on-demand services and app-based convenience, the sector is experiencing renewed momentum. The flexibility offered by short-term rentals appeals especially to tourists and business travelers alike.

Market Restraints

High maintenance costs and regulatory hurdles in certain regions may impede market growth. Taxation, licensing requirements, and fleet insurance complexities pose challenges for smaller operators. In addition, seasonal fluctuations in travel demand and rising fuel costs can affect profitability margins.

Market Opportunities

Emerging markets present a wealth of untapped opportunities, especially in urban centers with poor public transportation infrastructure. Additionally, growing environmental concerns are pushing rental providers to incorporate electric and hybrid vehicles into their fleets, aligning with customer expectations and sustainability mandates. Personalized rental services and AI-driven fleet optimization can further unlock value.

Reasons to Buy the Report

✔ Obtain an accurate forecast of the global car rental market up to 2032.
✔ Identify high-growth segments and regions to align business strategies.
✔ Benchmark performance against top competitors and industry leaders.
✔ Leverage insights into emerging trends such as EV adoption and digital bookings.
✔ Discover partnership and expansion opportunities in high-potential markets.

Company Insights

• Enterprise Holdings
• Hertz Global Holdings, Inc.
• Avis Budget Group, Inc.
• Europcar Mobility Group
• Sixt SE
• Localiza Rent a Car S.A.
• Carzonrent India Pvt. Ltd.
• Zoomcar
• Turo Inc.
• Getaround, Inc.

Recent Developments

1. Enterprise Holdings announced a major fleet electrification initiative in early 2025, committing to add 20,000 electric vehicles across its North American operations.

2. Hertz Global Holdings partnered with Uber to offer its fleet vehicles for ride-sharing, expanding its service model and tapping into the gig economy.

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This release was published on openPR.