Car rental Market Research Reports,Industry Analysis,Industry Research Report,Market Research Reports Consulting : Ken Research

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• Car Rental Industry The Threat Of Car Sharing To
  The Business Of Short Term Car Rental

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Introduction

• In April 2018, two companies, Ekar and Udrive
  were awarded contracts by the Dubai Road and
  Transport Authority for launching their ride
  sharing startups that allow users to share rides
  paying by the minute. Udrive has 70 of the
  market as of now. The introduction of ride
  sharing has allowed consumers to avail a larger
  variety of cars, instantaneous transport on
  demand and the comfort of travel in a car, all
  without having to bear the expense of purchasing
  or servicing a car. Although car rental market
  had a way to minimize the purchase of cars by
  allowing consumers to rent cars on a required
  basis, the high cost of renting a car for a day
  from a car company had led to an inverse effect
  with consumers. The increased need for rental
  cars became a dependency only for travelers. The
  growth of the market has been due to the
  increasing needs of business and leisure
  travelers. This was the major purpose of renting
  a car, to have it available when you need to
  travel anywhere, anytime.

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Ride Sharing

• March 2009, pegged the launch of Uber , the
  worlds largest ride sharing company, which was
  created as a solution to the issues of car
  rental allowing customers to order a car for
  their travel based on need for which the car
  would arrive in a few minutes . The cost of
  travel would be including everything required.
  Since then there have been petitions and protests
  by taxi drivers in multiple countries asking to
  ban apps like Uber although there has been
  regional adoption of the Uber business model in
  many countries as well. The advent of
  applications like Uber led to a major hit in the
  business of the taxi market. And today, ride
  sharing as a whole poses a threat to the rental
  car market. The largest rental car company in the
  US, Enterprise car rentals, was losing
  significant business due to the introduction of
  Turo, an app that allows users to list their own
  cars to be rented to make income and also allows
  users on the app to find their dream car to rent
  or to finance a new car. The point of the app is
  connecting car owners to people in need of a car
  just as Uber connects people in need of a car
  ride to people capable of providing one. The
  usage of applications like these has led to a
  major problem for rental car companies. Uber
  itself exists in 72 countries as of March2018.
  The availability of cars allows most business and
  vacation travelers the opportunity to avail a
  ride on demand by ordering a car for a trip with
  a driver and ensuring that there is no further
  need for the car. The only time this is an issue
  is if the car is needed to wait for the customer
  or if there is luggage that needs to be stored
  and hauled around. Usually, in business travel
  especially, there is a very minimal need for
  luggage to be carried around allowing most
  travelers to book an Uber between destinations
  for business travel and for a majority of
  vacation travel purposes as well. Hence the need
  of a rental car is not as high as before.
  Multiple car rental companies like Hertz and Avis
  have been constantly losing business due to the
  intrusion of Uber in the car travel market.
  Although the effect is not major yet, there is an
  expected trend that companies like Uber will
  become a major substitute to travelers who feel
  the cost of renting a car is too high to be
  justified as it is already happening with premium
  travelers and car rental is virtually inexistent
  among locals, there seems to be a growing threat
  to the car rental market from the ride sharing
  market

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Conclusion

• The companies that use ride sharing are taking
  away a portion of business for short term car
  rentals. The portion is expected to increase over
  time. The adoption of strategies such as
  gamification, increasing customer service, Real
  time GPS positioning and system automation are
  efforts made in improving operations and customer
  experience but cannot be adequate to win consumer
  confidence if the cost and satisfaction factor is
  not improved.

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  rtation-and-warehousing/car-rental/161.html
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• Ken Research
• Ankur Gupta, Head Marketing Communications
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