What’s evolving in the car rental industry? Think diverse offerings and mobility

Visit Website View Our Posts

Car rental companies should be feeling good about opportunity for growth and expansion. If you’re willing to merge traditional standards and innovation, you can take advantage of new trends while navigating potential risk.

This article isn’t intended as an analysis, but rather to point out some areas that on-airport and off- airport companies can look to for benefit. We encourage you to read about the nuances of change within the industry and to talk to trusted sources. Our summary view is that overall car rental—hiring a passenger vehicle for business and leisure for short-term duration--has evolved intensely in recent years and will continue evolving. Your specific niche may determine your approach to working with this evolution, but you’ll want to make flexibility a mantra, avoid fear of rental alternatives hurting your business, and focus on the potential that mobility trends hold out.

Make car rental alternatives a value-add rather than a threat

We’ll start with car sharing, which can be viewed as car rentals with a short usage span per customer and a denser customer base. Zipcar, a pioneer in the field within the United States, was acquired by Avis in 2013 for its promise in offering more diversified customer services. Incorporating car sharing calls for extremely agile and accurate handling of customer records, payment, service, and vehicle allocation and monitoring. Car rental companies with robust skill and operational experience in fleet management, logistics and general rental operations are in a strong position to add car sharing to their portfolio. It’s likely they would agree that tailoring working practices and ensuring their IT platform is updated to handle the changes is critical. Examples that stand beside Avis Budget/Zipcar include: Sixt’s JV with BMW (DriveNow), Europcar’s JV with Daimler AG (Car2Go Europe), Hertz 24/7 in several European countries, and Enterprise Car Share in the UK.

P2P services such as Uber also offer new avenues for growth in the car rental industry, not erosion. Within Europe and other countries, P2P is usually confined to urban areas and parallels more directly with taxis than car rental. Travelers and city-dwellers already are more inclined to use taxis and other forms of public transportation than a rental car. While there is of course challenge to look at, car rental companies should consider exploring opportunities to take on low-margin but high-volume transport—you’ve got the foundational experience. You can make the challenge a chance to take your business models and IT innovations to the next level. The recent Hertz/ Lyft partnership for Las Vegas has been widely publicized and could be a useful starting point for exploration

"How will you position yourself within the car rental industry so that you can evolve? A more diverse portfolio and more ways to reach customers is within reach."


Mobility: The megatrend that will drive your success in the car rental marketplace.

Mobility is the force that will enable car rental companies to offer services anytime, anywhere, via devices and channels that reach the largest possible span of customers. Mobility will let customers manage whatever service option they turn to from first glance through final payment remotely, on their phone, at a kiosk, via a site.
On the business side, mobility solutions will enable companies to maintain precise and real-time information about all aspects of vehicles and the environments they’re used in. Data can be used for immediate action and longer-term insight. Usage, operations, maintenance, fleet allocation, market analysis are just the tip of what can be monitored, mined, and most importantly, shared.

Mobility’s potential spans smart phones, IoT, enhanced driver experience, even self-driving cars. The car rental industry is a key service provider at the heart of the mobility universe and has opportunity to strengthen current business and IT models with mobility solutions that speak to an evolving market.

Curious about possibilities, challenges, and solutions?

Please contact us to discuss possibilities, challenges and solutions - we also encourage you to take a look at our website for more industry specific information.

Leave a Comment

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Show Buttons
Hide Buttons