Spain Car Rental Market - Growth, Trends, Covid-19 Impact, and Forecasts (2023 - 2028)

Spain Car Rental Market - Growth, Trends, Covid-19 Impact, and Forecasts (2023 - 2028)

The Spain car rental market is anticipated to register a CAGR of about 6.25% during the forecast period (2019 – 2024).

• Rise in the number of tourists into the country, increase in the car rental fleet size, etc. are driving the car rental market in Spain.
• The country has 47 UNESCO World Heritage Sites, numerous beaches on the Atlantic & Mediterranean, and numerous ongoing festivals across the year, which aids in gathering millions of international tourists, along with domestic tourists.
• As per the UN World Tourism Organization, Spain registered 81.8 million international tourists during 2018. This helped Spain to hold the second position as the most visited country in the EU region, after France.
• Online booking channel of car rental is more popular in the country compared to offline booking. Many start-ups (online booking companies) have entered the market and are trying to capture a significant market share from the major players. My Tripcar, a GBP 48 billion European start-up, has entered the industry to provide transparency in pricing and thereby avoiding hidden costs.

Tourism is a growing sector in the country and is one of the key factors driving the growth of the economy. CEHAT, the Spanish hotel management association, predicts that the tourism industry will not grow with the same pace as of 2017 in the coming years, irrespective of it witnessing a boost of 28.5 million visitors.

Hoteliers estimate that this development will decline in the upcoming months due to fewer arrivals of British and German visitors, owing to the new level of competitiveness in the industry with the inclusion of countries in the Mediterranean (such as Egypt, Tunisia and Turkey) and the labor strikes in the airline sector of the country.

In spite of the aforementioned odds, Spanish tourism industry is expected to forecast positive figures for the summer season, as the negative impact of the arrival of a smaller number of foreigners would be offset by the increase in domestic tourism.

Spanish vehicle rental companies cater specifically to tourists looking to explore Spain on their own, with online and walk-in booking services making vehicle rental simpler, accessible, and efficient.

The economy car demand in Spain is high as they are more pocket friendly. Coupes, Sedans, hatchbacks, and SUVs/MPVs are the typical car models offered under economy prices by most of the rental companies. Currently, the rental prices for the above mentioned models in the country are as follows:

• Coupe car models, such as Fiat 500, are offered at EUR 2 per hour.
• Sedan and hatchback car models, such as Volkswagen Passat and Seat Leon respectively, are offered at EUR 3-4 per hour.
• SUVs/MPVs car models, such as Nissan QASHQAI, are offered at EUR 5-8 per hour.

Among the brands, SEAT car models (like Leon and IBIZ) witnessed the highest registration of 53.4% in 2017 compared to that of 2016.

• The demand for the above mentioned brand is expected to grow further in the coming years. Recently in February 2018, SEAT acquired Spanish start-up Respiro, a car rental company in city of Madrid, founded in 2010, with an annual turnover of EUR 1.8 million in 2016.

The Spain car rental market is growing swiftly and major players in the market are Budget Rent a Car System Inc., The Hertz Corporation, Advantage Rent a Car, Centauro Rent a Car, Europcar Mobility Group, Sixt SE, etc. As the rental car demand is growing in the country, car rental service providing companies are launching new facilities to make customers more comfortable. For instance, August 2018: Hertz Europe has launched free mobile Wi-Fi and other exclusive benefits for qualifying car rentals in more than 200 locations across Europe.

• The market estimate (ME) sheet in Excel format
• 3 months of analyst support