The automotive industry finds renting and leasing vehicles and equipment to be a desirable option. In addition to offering the greatest selection of equipment for increased job versatility, it offers more advantages than outright purchase. Regular maintenance costs, storage, and transportation are some of the costs avoided by renting rather than purchasing. Because of these advantages, the market for the rental and leasing of automotive equipment has expanded.
Covid 19 Impact and Market Status
The worldwide COVID-19 pandemic has devastated economies all over the world, and it has had a significant negative impact on businesses in all industry sectors but has been especially severe on the transportation services sector. In many areas, the challenges resulting from the global lockdown are enormous and insurmountable. There has been a significant decline in commuter and non-essential travel as a result of the COVID-19 outbreak, which has led to an increase in the number of businesses requiring their employees to work from home. This has negatively impacted the car rental industry. The temporary lockdowns implemented to stop the COVID-19 outbreak are distressing automotive equipment leasing companies. Companies must adhere to safety protocols after the lockdown is lifted, which will raise the cost. These protocols include body temperature scanning, social isolation, and ensuring high standards of sanitization. Renting cars has become more popular as a result of the world financial crisis alone.
Following the pandemic, with safety and hygiene becoming more important, techniques for disinfecting automobiles are strictly followed. It is anticipated that industry conditions will improve as a result of the need for individual mobility and social distance norms. In recent years, the automotive equipment rental market has changed dramatically thanks to the subscription model. Because of this model, customers can take advantage of temporary ownership without worrying about supplemental expenses like maintenance and insurance premiums.
The Passenger Car Type to Emerge as the Most Lucrative Segment
The market for automotive equipment leasing has been split based on the type under rental and leasing of passenger cars, trucks, utility trailers, and recreational vehicles. During the forecast period, the passenger automobile rental segment is anticipated to increase at the greatest CAGR. The rising popularity of ride-hailing and car-sharing services is to blame for this.
Online Mode to Increase the market Drive
Big data and other technologies are being used by automotive equipment leasing companies to improve customer service and vehicle longevity. Large data sets that can be analysed to produce new information and inform decision-making are known as "big data." The leasing company could use big data to remind the driver to schedule a service appointment or change the engine oil. By providing the leasing companies with information about the driving behaviours and whereabouts of their fleet, this technology may also assist them in reducing driver risk and reducing the number of accidents. Businesses like Lex Auto Lease have been utilising big data more and more to drive cost reduction and risk mitigation.
The Most Popular Lease Type Segment is the Option To Buy a Lease
The market for leasing automotive equipment has been divided into closed-ended leases, option-to-buy leases, and subvented leases based on the form of lease. During the forecast period, the option to buy the lease category is anticipated to increase at the greatest CAGR. This might be due to its advantages, which include cheaper monthly expenses and flexibility in terms of miles and duration.
Asia Pacific to hold Largest Share in Market
With 33% of the market share in 2020, Asia Pacific was the largest region in the world market for leasing automotive equipment. With 31% of the global market for leasing automobile equipment, Western Europe was the second-largest region. The automotive equipment leasing market was most concentrated in Africa.
The market is expanding as more people switch from buying to leasing cars, as leasing is becoming more widely adopted and people are becoming more aware of its advantages. The cost of the original equipment at the time of the crashes is predicted to limit the market growth. The rise in management software usage and the development of new mobile technologies present market opportunities.
Big data and other technologies are being used by automotive equipment leasing companies to improve customer service and vehicle longevity. Big data refers to vast amounts of data that can be analysed to produce new knowledge and influence decision-making. The leasing company could use big data to remind the driver to schedule a service appointment or change the engine oil. By providing the leasing companies with information about the driving behaviours and whereabouts of their fleet, this technology may also assist them in reducing driver risk and reducing the number of accidents. Big data is being used more and more by businesses like Lex Auto Lease to drive cost reduction and risk mitigation.
Over the forecast period, the Automotive Rental And Leasing Market are expected to be primarily driven by increasing sales of electric vehicles. Particularly in developed nations, leasing is being used more frequently as a key strategy to support the electric vehicle industry. Leasing, when compared to other purchasing processes, significantly reduces consumer concern about the cost of electric vehicles and the rate of technological obsolescence by offering affordable monthly instalments and options for vehicle replacement.
The market for renting or leasing automotive equipment is made up of companies (organisations, sole proprietors, and partnerships) that rent or lease utility trailers, and recreational vehicles (RVs) without drivers, passenger cars, trucks, and vans. Usually, these companies provide a facility similar to a retail store where customers can rent and lease automotive components.
The market for renting and leasing automotive equipment will be significantly influenced by technological advancements during the forecast period. Leasing firms for automobiles are increasingly utilising digital technologies like the internet of things (IoT) and big data to manage their fleets more efficiently, save costs, and improve customer satisfaction. As mobility technologies advance, such as in-car navigation and automation, there will be greater demand for leased cars, especially among millennials.
The rental or leasing of automotive equipment by businesses (organisations, sole proprietors, and partnerships) that offer passenger cars, trucks, vans, utility trailers, and recreational vehicles (RV) without drivers are referred to as the automotive equipment leasing market. For the renting and leasing of automotive equipment, these businesses typically run a facility that resembles a retail store. Short-term or long-term rentals are offered by some rental and leasing businesses for automotive equipment, while both are offered by others.
The primary driver of the automotive leasing market in the upcoming years is anticipated to be an increase in electric vehicle sales. Additionally, the market will continue to grow as a result of the rising popularity of electric cars, e-commerce, rising investments in big data and IoT, and the penetration of blockchain in the automotive leasing and rental industries. In the market for automotive rental and leasing, there are two key trends. To improve customer service and extend vehicle life, automotive leasing and rental companies are using technologies like big data. With the help of big data, businesses can remind drivers to schedule an oil change or service appointment for their vehicles.
At a CAGR of 14.0% over the forecast period, the market for leasing automotive equipment is expected to increase from USD 9.7 billion in 2019 to USD 24.8 billion by 2029.
The rise in online users, rising demand for passenger cars and commercial vehicles, and the expanding trend of vehicle sharing are all factors that have contributed to the market's expansion.
Since lockdowns imposed by governments around the world as a result of the COVID-19 outbreak have reduced demand for the services provided by these businesses, the market for leasing automotive equipment has been severely constrained. COVID-19 is an infectious illness that causes flu-like symptoms such as fever, coughing, and breathing difficulties. The market for car rentals and leases is expected to experience growth due primarily to the on-demand taxi industry's growing popularity.
An in-depth analysis of the global market is provided in the study report titled "Global Automotive Rental And Leasing Market." The top companies operating in the market are Toyota Financial Services, Honda Canada Finance Inc., Enterprise Holdings, Daimler Group, The Hertz Corporation, Avis Budget, Ford Credit, LeasePlan, GM Financial, and Ally Financial Inc.
Latest Innovations in the Global Automotive Equipment Leasing Market: A Snapshot
- May 2021: Kyte, a new car rental service, has opened in New York City, becoming its fifth location. An app-based car rental service called Kyte delivers vehicles directly to customers.
- November 2020 - Skoda Auto India and Orix Auto Infrastructure Services Ltd. have joined forces to offer leasing options to salaried people, professionals in the workforce, SMEs, government agencies, and corporate entities.
- In October 2020, the OLX Group, which is owned by Proses, paid an undisclosed sum to acquire the majority of CarSmile, a Polish startup that offers car leasing and rental services. The investment will assist OLX in expanding into the new car segment.
Automotive Equipment Leasing Devices Market Scope
|Revenue forecast in 2029
|USD 24.8 billion.
|CAGR of 14.0% during 2019-2029
|Type, Mode, Lease Type, Regions
|North America, Europe, Asia Pacific, South America, Middle East and Africa
|Key Players Profiled
|Toyota Financial Services, Honda Canada Finance Inc., Enterprise Holdings, Daimler Group, The Hertz Corporation, Avis Budget, Ford Credit, LeasePlan, GM Financial, and Ally Financial Inc.
Key Segments of the Automotive Equipment Leasing Devices Market
Type Overview (USD Billion)
- Passenger Car Rental
- Passenger Car Leasing
- Utility Trailer and Recreational Vehicle Rental & Leasing
Mode Overview (USD Billion)
Lease Type Overview (USD Billion)
- Closed Ended Lease
- Option To Buy a Lease
- Subvented Lease
Regional Overview (USD Billion)
- Rest of Europe
- Rest of Asia Pacific
- Rest of South America
Middle East and South Africa