Market Size of UAE Car Rental Industry
| Study Period | 2019 - 2029 |
| Base Year For Estimation | 2023 |
| Forecast Data Period | 2024 - 2029 |
| Historical Data Period | 2019 - 2022 |
| CAGR | 11.80 % |
| Market Concentration | Medium |
Major Players
*Disclaimer: Major Players sorted in no particular order |
Car Rental in UAE Market Analysis
United Arab Emirates car rental was valued at USD 885.83 million in 2021 and expected to surpass a net valuation of USD 1,729.80 million by 2027 end, registering a solid CAGR growth of 11.8% during the forecast period.
The COVID-19 pandemic has partially affected the market for the United Arab Emirates car market with strict lockdown and a decrease in traveling to restrain the spread of the virus. However, with an increase in the number of tourists visiting the UAE, the demand for car rental services has picked up the pace by the end of 2021 and is likely to continue over the forecast period.
Consumer preferences shifted as a result of a variety of circumstances. Most notably, health concerns drove people and families to hire vehicles rather than public transportation. The rise of digital platforms in the marketplace has also facilitated the selection of cars for hire or leasing.
Significant growth in the population of individuals traveling for business and leisure travel is driving demand for car rental services. Rising internet penetration across the country has enabled enterprises in the sector to attract a wider consumer base through the use of smart mobile applications for customer convenience.
- Udrive, the app-based pay-per-minute car rental service, has announced a USD 5 million Series B round of funding, in which it will welcome commercial, institutional and private investors. Such funding will positively impact the market growth in the upcoming years.
Thus, growing commercial events and reviving tourism activities will positively impact the market growth during the forecast period.
Car Rental in UAE Industry Segmentation
Car renting refers to the business of leasing and renting a car from rental service providers based on some valuation. This renting can be on an hourly basis or for a longer time span.
The car renting market is segmented by rental duration type, booking type, application type, driving type and vehicle type. By rental duration type , the market has been segmented into short term and long term. By booking type, the market has been segmented into online and offline. By application type, the market has been segmented into daily utility and tourism. By driving type, the market has been segmented into self-driven and chaffeur and by vehicle type, the market is segmented into economy cars, luxury cars and SUV. For each segment, the market sizing and forecasting are based on value (USD million).
| Rental Duration | |
| Short Term | |
| Long Term |
| Booking Type | |
| Online | |
| Offline |
| Driving Type | |
| Self-Driven | |
| Chauffeur-Driven |
| Vehicle Type | |
| Budget/Economy | |
| Premium/Luxury |
UAE Car Rental Market Size Summary
The car rental market in the United Arab Emirates is experiencing significant growth, driven by an increase in both business and leisure travel. The market has rebounded from the impacts of the COVID-19 pandemic, with a surge in tourist arrivals boosting demand for rental services. Consumer preferences have shifted towards private vehicle rentals due to health concerns, and the rise of digital platforms has made it easier for customers to book and lease cars. The expansion of internet access has further facilitated this trend, allowing companies to reach a broader audience through mobile applications. The market is also benefiting from trends such as staycations and the blending of business and leisure travel, which are becoming more popular among younger professionals.
The UAE's car rental industry is supported by stringent government regulations on vehicle ownership and public transportation limitations, particularly in cities like Dubai where distances between attractions are considerable. This has led to a preference for rental cars among both tourists and residents. Companies are introducing innovative solutions, such as subscription-based services and virtual marketplaces, to enhance customer convenience and expand their offerings. The market is characterized by a competitive landscape with key players like Sixt SE, The Hertz Corporation, and AVIS Rent a Car, who are investing in fleet expansion and improved connectivity to meet the growing demand. The adoption of online booking systems and transparent payment processes is expected to further drive market growth in the coming years.
UAE Car Rental Market Size - Table of Contents
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1. MARKET DYNAMICS
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1.1 Market Drivers
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1.2 Market Restraints
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1.3 Porters Five Force Analysis
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1.3.1 Threat of New Entrants
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1.3.2 Bargaining Power of Buyers/Consumers
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1.3.3 Bargaining Power of Suppliers
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1.3.4 Threat of Substitute Products
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1.3.5 Intensity of Competitive Rivalry
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2. MARKET SEGMENTATION (Market Size in Value USD Million)
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2.1 Rental Duration
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2.1.1 Short Term
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2.1.2 Long Term
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2.2 Booking Type
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2.2.1 Online
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2.2.2 Offline
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2.3 Driving Type
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2.3.1 Self-Driven
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2.3.2 Chauffeur-Driven
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2.4 Vehicle Type
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2.4.1 Budget/Economy
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2.4.2 Premium/Luxury
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UAE Car Rental Market Size FAQs
What is the current UAE Car Rental Market size?
The UAE Car Rental Market is projected to register a CAGR of 11.80% during the forecast period (2024-2029)
Who are the key players in UAE Car Rental Market?
SIXT SE, Avis Budget Group, The Hertz Corporation, Speedy Drive Car Rental LLC and Uber Technologies are the major companies operating in the UAE Car Rental Market.
