Indonesia Car Rental and Leasing Market Outlook to 2029

Indonesia Car Rental and Leasing Market Overview

• The Indonesia Car Rental and Leasing Market is valued at  IDR 70 TN, reflecting robust growth driven by rising demand for flexible mobility, rapid urbanization, and an expanding middle class seeking convenient transportation. Tourism, especially in Bali, and increased business travel further fuel market expansion. Consumers increasingly prefer renting vehicles for flexibility and cost-effectiveness over ownership, supported by digital booking platforms and improved infrastructure. The market is projected to grow, reshaping mobility options across Indonesia.
• Key cities like Jakarta, Bali, and Surabaya dominate Indonesia’s car rental market due to high population density, strong economic activity, and tourism. Jakarta, the capital and business hub, attracts many travelers and professionals. Bali, a top international tourist destination with over 6.3 million foreign visitors in 2024, drives significant rental demand. Surabaya, a major trade center, supports strong demand from local and visiting business communities, making this city central to the market.
• In recent years, the Indonesian government has required car rental companies to register with the Ministry of Transportation. These regulations aim to improve service standards, ensure safety compliance, and promote transparent pricing, boosting consumer trust and market growth. Regulations like the Ministry of Transportation Regulation No. 108/2017 also govern vehicle operations and cooperation with ride-hailing services, reflecting efforts to formalize and regulate the sector amid ongoing enforcement challenges.

Indonesia Car Rental and Leasing Market Segmentation

By Consumer Type: The market is segmented into B2B Consumers, B2C Industry clients, and B2C Personal Users. B2B Consumers, including corporate clients and logistics firms, account for a significant share due to long-term leasing and fleet management needs. B2C Industry clients, such as travel agencies and event organizers, drive demand for short-term rentals during peak seasons. Meanwhile, B2C Personal Users are increasingly adopting rental services for leisure, daily commuting, and special occasions, supported by rising disposable incomes and improved digital booking platforms.

By Time-Based Product Type: The market is segmented into monthly and yearly rental contracts for B2B consumers. Yearly rentals contribute the highest revenue share, driven by corporate clients seeking long-term fleet solutions for employee mobility and logistics. These contracts offer cost stability and operational continuity for businesses. Monthly rentals are gaining traction among SMEs and project-based industries due to their flexibility, allowing companies to scale fleets based on short-term operational needs without long-term commitments.

Indonesia Car Rental and Leasing Market Competitive Landscape

The Indonesia Car Rental and Leasing Market features a competitive landscape with prominent players such as Bluebird Group, TRAC Astra, and Hertz Indonesia. These companies are recognized for their extensive fleets, strong brand presence, and commitment to customer service. The market remains moderately concentrated, with both local and international firms competing on pricing and service innovation.

Indonesia Car Rental and Leasing Market Industry Analysis

Growth Drivers

• Pro-Tourism Initiatives and National Events Driving Rental Demand: Indonesia’s tourism recovery is accelerating, with over 0.7 trillion domestic trips recorded in 2023, supported by government campaigns such as “Wonderful Indonesia.” National events and festivals boost short-term vehicle rental demand in key regions like Bali, Jakarta, and Yogyakarta, causing booking spikes during peak travel periods and driving seasonal revenue for rental companies.
• Infrastructure Growth & Rising Disposable Incomes Fueling Mobility: Major infrastructure projects like the Trans-Java Toll Road and new airports are improving connectivity in Indonesia. In 2024, Indonesia’s GDP per capita reached approximately IDR 0.0786 trillion (78.6 million rupiah). The country’s total GDP at current prices was around IDR 22,139 trillion in 2024. This rising purchasing power, combined with better infrastructure, is driving increased demand for flexible mobility options such as car rentals, especially among the expanding middle class.
• Corporate Leasing & E-Commerce Logistics Accelerating Market Growth: The rise in corporate fleet leasing is being driven by businesses optimizing travel costs and operational efficiency. Simultaneously, the booming e-commerce sector, with players like Tokopedia and Shopee, is driving last-mile delivery needs. This dual demand is encouraging rental providers to expand B2B offerings, diversify vehicle types, and invest in fleet scalability to serve both enterprise clients and logistics operators.

Market Challenges

• Rising Operational Costs & Elevated Vehicle Logistics: Rental companies are facing increasing operational expenses driven by higher fuel prices, maintenance costs, and elevated vehicle shipping charges, especially for fleet distribution across islands, impacting overall profitability and service scalability.
• Market Disruptions from Unorganized Players & Resale Value Decline: Intense price competition from unorganized local operators is eroding margins for established firms, while shifting consumer demand and EV adoption trends are reducing the resale value of conventional vehicles, posing financial challenges for fleet renewal strategies.

Indonesia Car Rental and Leasing Market Future Outlook

The future of the Indonesia car rental and leasing market appears promising, driven by evolving mobility preferences and innovative ownership models. As MPVs gain traction for family and group travel, and more users turn to digital platforms for bookings, tech-enabled services will define competitive advantage. Additionally, the introduction of co-ownership models and a growing focus on sustainability are prompting rental companies to diversify fleets and adopt greener alternatives. Overall, the market is set for robust growth, with flexibility, convenience, and eco-consciousness shaping the next wave of service innovation.

Market Opportunities

• Introduction of Co-Ownership Models & Growing Focus on Sustainability: With rising vehicle costs and environmental concerns, car rental firms in Indonesia are exploring co-ownership and car-sharing models to reduce capital burden and increase fleet utilization. Simultaneously, the government’s push for low-emission mobility, including incentives for electric vehicles, is encouraging companies to adopt greener fleets, aligning business models with sustainability goals, and shifting consumer expectations.
• MPVs Gaining Traction & Growing Popularity of Digital Platforms: Multi-purpose vehicles (MPVs) are witnessing increased demand in Indonesia due to their versatility and suitability for family and group travel, especially across tourism hubs. Simultaneously, with over 212 million internet users and growing smartphone adoption, car rental firms are leveraging digital platforms to enhance booking efficiency and customer engagement, aligning with the shift toward online mobility solutions.