UAE Car Rental and Leasing Market - Ken Research

UAE Car Rental, Leasing and Limousine Market Size 2021 COVID-19 Impact Analysis by Business Opportunities, Applications, Geography, Growth Drivers, and Future Outlook till 2025

The report titled “The UAE Car Rental, Leasing and Limousine Market Outlook to 2025 (Second Edition) – Driven by Reviving Tourism, altered Customer Preference from Public Transport to Personal Cars owing to Covid-19” provides a comprehensive analysis on the status of the Car Rental, Lease and Limousine industry in UAE. With respect to the car rental and leasing market/industry the report covers various aspects including fleet size & market size, segmentation by Emirates (Dubai, Abu Dhabi, Sharjah, Others), Major Players in the market and their market share, Types of Cars (Economy, SUV, Luxury), End Users (Corporates or Individuals), Duration of the Rentals (0-1 Month, 1-6 Months and 6-12 Months), and Booking destinations (On – Airport and Off – Airport). Furthermore, the report provides insight into the Limousine Market in UAE by covering aspects such as Fleet Size over the years, the Market Size, Segmentation by Emirates (Dubai, Abu Dhabi, Sharjah, Others), Type of Limousines (Standard, Large Sized, Premium and Ultra Luxury), Revenue of Cab Aggregators, Revenue By Source (Events and Non-Events), and Major Players in the Limousine Space. Additionally, the report also provides details regarding the taxi business industry in UAE with specifics related to the number of trips done, number of people using the taxis, and, fare estimation between different companies. The report takes into account of the qualitative and expected effects of Covid-19 pandemic on the above mentioned segments, especially vis-à-vis the rental and leasing market, where growth factors, information regarding the strength, opportunity, potential threat to the industry is also mentioned. The UAE Car Rental and Leasing Market report concludes with projections for the future industry including forecasted sales revenue and volume by 2025, market segmentations and analysts’ take on the future.

UAE Car Rental Market Overview and Size:

UAE Car Rental market has increased at a negative CAGR of ~ 0.6% during 2015-2020, mainly due to the impact of taxation introduced by the government coupled with the less number of cars rented due the lockdown imposed in the country owing to the global pandemic Covid-19. However, an expected revival in tourism, strong vaccination rates, increased technological upgradation for both suppliers and customers, favorable government initiatives in the form of various events such as Expo 2020 and Abu Dhabi Grand Prix, and favorable changes in customer preference towards personalized vehicles are all factors that are expected to help the UAE Car Rental Market grow in the forthcoming years.

UAE Car Rental Market Growth Strategy Report

UAE Car Rental Market Segmentations

By Emirates

Dubai and Abu Dhabi lead as the Emirates with the highest number of rented fleets with a combined share of ~80%. The car rental market is expected to grow in other Emirates such as Sharjah but the bulk of the demand remains with these emirates.

By Types of Car

The two most preferred vehicles in the segment are the economy vehicle and the SUVs, which have a combined share of ~90% in the market. The economy segment dominates on all the other segments due to affordability and flexible with respect to the duration of rentals permitted by the companies.

By Location of Car Bookings

The majority of the bookings happen through the airports which accounted the highest share in the market. However, this trend is expected to change in the coming years with the introduction of apps by aggregators who provide vehicles free of delivery to major parts of various cities. Therefore, the number of booking off airports is expected to increase massively.

By End Users

Due to the pandemic, small corporates have turned towards leasing along with an increased demand by individuals. However, the corporates edge out individuals with a dominating share in the rented market.

By Duration of Car Rentals

The majority of car rentals are taken for a period of less than 1 month. The same stands as a characteristic for personal leasing and leasing done by small corporates. It has a share of ~45%. Larger corporates and government agencies prefer longer rentals that extends for either half a year or a complete period of 12 months. Due to the uncertainty in the commercial practices across the country owning to the pandemic, corporates and individuals shifted preference towards short term rentals

UAE Car Leasing Market Overview and Size

UAE Car Leasing sector is in a growth phase, having grown at a CAGR of ~1.6% during 2015-2020 (5.1% CAGR Pre-Covid during 2015-2019). The sector is expecting a revival based on factors such as increase in tourist footfall, increased commercialization post Covid-19, and a movement towards specialization of services provided to corporates such as providing chillers for logistic companies. The market has become less fragmented due to small players, who were majorly dependent on contracts of shorter duration being pushed out of the market as a result of the financial backlash of Covid-19 induced lockdown. Thus, for a steady flow of business in this uncertain environment, corporates have started working with the well-established players in the market.

UAE Car Leasing Market Segmentations

By Emirates

The major commercial hubs of Dubai and Abu Dhabi alone accounted for more than 80% share in the market. Where Dubai accounted the highest share with respect to other Emirates. On the other hand, in the near future it is anticipated that Sharjah will increase of ~10% CAGR over the next 5 years.

By Types of Car

The most preferred vehicles in the segment is the economy vehicle with a share of ~60%. SUVs is the next most favored vehicle for the car leasing industry. Pick-up vans contribute a respectable 12% towards the segment and is majorly used by the corporates of all sizes. The economy segment dominates due to the fact that most of the vehicles leased are for lower level management and employees who have to attend meetings or supervise clients which requires features such as low cost, a satiable mileage limit and durability.

By Duration of Car Rentals

The majority of car leasing are taken for a period of 3 years or more as the fleet leased by the various companies in the industry for a period of 3 years or more is ~ 70%. The primary reason behind the same is that the companies offering the leasing to the companies are able to write off the depreciation as the duration of the leasing increases. However, established players to match customer expectations suggest a period of 3 years for leasing compared to a shorter duration of 1 years or 2 years. The time period further increases for commercial vehicles such as 15 seater or a chiller.

By End Users

The corporates tend to edge over individuals in the car leasing market. This pattern has accelerated further due to the pandemic as both the parties have moved towards a longer lease periods with more value addition services.

By End Users under Corporates

The corporate firms which lease the highest number of fleets in the industry is the facility management services under which pick-ups vans are the most used vehicles as facility management companies tend to use the most manual labors and thus, require these vans for transportation. The share of the facility management industry stands at more than 25%. It is followed by corporates engaged in the industrial sector and food services.

UAE Limousine Market Overview and Snapshot on the Landscape

The Limousine Market remains relatively fragmented compared to the rental and leasing market with a number of small players and a relatively small average fleet size of about 32 vehicles per company. The Limousine market suffered greatly during the lockdown in the 3rd Quarter of 2020 as almost 80% of the bookings taking place are for events and are dependent on bookings from the airports. Both of these activities were prohibited. Furthermore, one of the major player in the market is controlled by the Government and there has been a push towards making the Limousine space more eco-friendly by increasing the number of electronic vehicles and hybrid vehicles. Additionally, there have been heavy fines imposed on Limousines which have been running for more than 5 years in the market. On the positive side for the Limousine Market, reorganization of business events, fairs, expos and sporting events provide an opportunity.

Competitive Landscape of UAE Car Rental and Leasing Market

There exists intense competition between various companies prevailing in the market. The market is primarily dominated by 10-12 major players which include government backed organizations such as Emirates Transport, international players such as Avis and Hertz, and big regional players such as Fast Rent A Car. The market became slightly less fragmented due to the uniformity in price triggered by the aggregators as all these players are currently trying to register their fleets with these aggregators. Therefore, the major players are avoiding to engage in a price war and are trying to gain market share by providing differentiated valued added services. Furthermore, some players such as Hertz are moving almost exclusively towards providing vehicles to corporates. The medium and smaller players are competing in a more traditional way of providing rental and leasing services as per the demand of the businesses.

UAE Car Rental and Leasing Market Future Outlook & Projections

The Rental Market is supposed to see an increase in the market size with a CAGR of ~8% during 2020-2025. The growth factors behind this are the aggregators and change in consumer preference that is being experienced in the market. The role of the aggregators is still in the nascent stage with a few companies trying to gain the market. In terms of Emirates, Dubai and Abu Dhabi are expected to dominate the rental and leasing space due to the increased commercialization. Vis-à-vis Sharjah in the Rental Space, it is expected to see an increase of  CAGR 10% in the next 5 years owing to the increased commercialization taking place in the emirate. The Leasing Market is expected to grow at a CAGR of ~5% during 2020-2025. The Car Rental, Leasing and Limousine market has to be vary of government regulations that would be imposed with respect to the introduction of electronic vehicles in the market. The Government agencies have been slowly trying to move towards more eco-friendly options and there is a nudge towards the same with half of the taxi fleet in Dubai being either Electric or Hybrid.

Key Segments Covered for Car Rental

  • By Emirates
  • Dubai
  • Abu Dhabi
  • Sharjah
  • Others (Ras Al Khamiah, Sharjah, Al-Ain, Ajman and Umm Al Quwain)
  • By Types of Car
  • Economy
  • SUV
  • Luxury
  • By End User
  • Corporate
  • Personal
  • By Source of Booking
  • On-Airport
  • Off-Airport
  • By Duration of Car Rental
  • 0-1 Month
  • 1-6 Months
  • 6-12 Month

Key Segments Covered for Car Leasing

  • By Emirates
  • Dubai
  • Abu Dhabi
  • Sharjah
  • Others (Ras Al Khamiah, Sharjah, Al-Ain, Ajman and Umm Al Quwain)
  • By Types of Car
  • Economy
  • SUV
  • Luxury
  • Pick-Up Vans
  • By Type of Car Leased
  • Corporate
  • Personal
  • By Duration of Car Leasing
  • 1 Year
  • 2 Years
  • 3 Years
  • More than 3 Years
  • By End User
  • Facility Management
  • Industrial Sector
  • Food Services
  • Logistics
  • Others

Key Segments Covered for Limousine Car

  • By Emirates
  • Dubai
  • Abu Dhabi
  • Sharjah
  • Others (Ras Al Khamiah, Sharjah, Al-Ain, Ajman and Umm Al Quwain)
  • By Limousine Companies in Emirates (Number of Companies)
  • Dubai
  • Abu Dhabi
  • Sharjah
  • Others (Ras Al Khamiah, Sharjah, Al-Ain, Ajman and Umm Al Quwain)
  • By Types of Car
  • Standard
  • Large Sized
  • Premium
  • Ultra Luxury
  • By Business
  • Event
  • Non – Event
  • By Source of Business (for Cab Companies)
  • Airport
  • Non – Airport
  • By Source of Business
  • Cab Companies
  • Non – Cab Companies
  • By Source of Payment
  • Direct from Corporate
  • Corporate Payments
  • By Purpose of Limousine
  • Leisure
  • Corporate

Companies Covered

  • Rental and Lease Companies
  • Thrifty Rent a Car
  • Emirates Transport
  • Hertz
  • Diamondlease
  • Massar Car Rental
  • Leaseplan
  • Shift Rent a Car
  • National Car Rental
  • Avis Rent a Car
  • Europcar
  • Budget Rent a Car
  • Fast Rent a Car
  • Dollar
  • Nirvana Travel and Tourism
  • AutoRent

Limousine Companies

  • Dubai Taxi Corporation
  • Emirates Transport
  • CityLink Limousine
  • Private Limousine
  • Avis Limousine
  • Transguard Limousine
  • Limoinuae
  • National Transport
  • Sharjah Roads and Transport Authority
  • Hot Wheels Limo
  • Global Wings Limousine
  • Cityway Limousine
  • Royal Falcon Limousine
  • Insaf Limousine
  • Onak Limousine
  • Dubai Exotic Limo

Major Dealer

  • Al Habtoor
  • Al Futtaim
  • Al Rostamani
  • Al Tayer Group
  • Ali and Sons

Key Target Audience

  • Car Rental companies
  • Car Leasing companies
  • Limousine Companies
  • Tourism Industries
  • Tour and Travel Aggregator
  • Automobile companies
  • Cab taxi companies
  • Cab Aggregators
  • Technology Provides
  • Investors and Venture Capitalist
  • Government Associations

Time Period Captured in the Report:-

  • Historical Period – 2015-2020
  • Forecast Period – 2021-2025

Key Topics Covered in the Report

  • Overview of the UAE Car Rental, Leasing and Limousine Industry
  • Government Regulations, Initiatives and Procedure to Start Car Rental & Leasing Business
  • Car Rental Market Overview
  • Car Rental Market Size
  • Car Rental Market Segmentation
  • Future Outlook of the UAE Car Rental Market, 2020-2025F
  • Car Leasing Market Overview
  • Car Leasing Market Size
  • Car Leasing Market Segmentation
  • Future Outlook of the UAE Car Leasing Market, 2020-2025F
  • Competition in Car Rental and Leasing Market
  • Company Profiles of Rental and Lease Companies
  • Limousine Car Market Overview
  • Limousine Car Market Segmentation
  • Competition in Limousine Service Market Overview
  • Future Outlook of the UAE Limousine Car Market, 2020-2025F
  • Covid-19 Impact on the Industry & the way forward
  • Analysts’ Recommendations

For More Information, refer to below link:-

UAE Car Rental Market Research Report 2021

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Ankur Gupta, Head Marketing & Communications


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