The great vehicle rental business that is heading towards one million vehicles and a turnover of 6,000 million

2023-10-29 22:45:15

The long-term vehicle rental market, known as “renting”, has doubled in size in a decade and it is expected that in two years there will be more than one million vehicles in Spain under this ownership regime. Renting is a service through which you access a vehicle, without having to buy it, and in exchange for a fixed monthly fee it is used as if it were your own, although the client does not have to assume the expenses derived from its putting into circulation or maintenance. At the end of the contract period, the user can sometimes choose to purchase the vehicle for its residual value.

The AER – which brings together companies that offer “renting” services – estimates that the growth of the park under this type of long-term rental will remain around 7% and 8% year-on-year for next year, as explained to Eph. From 2009 to 2013, the vehicle fleet dedicated to renting decreased year after year, with drops of between 5% and 8% year-on-year. The sector’s turnover also fell during all those years, at rates also of between 3% and 7%. The AER believes that these setbacks were due to the effect of the economic crisis that broke out internationally in 2008. Companies had to “diversify the channels to dispose of their surplus used vehicles,” among other measures.

In 2013, the number of rental vehicle registrations was 119,836 units, a far cry from the more than 200,000 that were registered in 2007, before the crisis. From then on, the park grew again, in 2014 just 1.7%, but year after year the growth rate accelerated to 14% in 2108 and 13% in 2019. That year, the park renting added more than 80,000 vehicles in a single year, reaching more than 711,000 vehicles, and saw investments in this segment grow by more than 20% and turnover by 13% to exceed 6.3 billion euros.

Then, the pandemic arrived. In 2020, only 31,700 rental vehicles were registered, compared to 82,300 a year earlier. But the most striking thing was the decrease in the number of vehicles that were finally acquired by the user at the end of the contract. In addition, the customers who finally chose to purchase their vehicle fell drastically that year, and purchases fell by 30% to around 200,000 units, compared to more than 300,000 in 2019. Likewise, the sector’s turnover fell below of the 6,000 million, compared to the more than 6,300 that it registered a year before.

That year, the main challenge for vehicle rental companies was “to ensure the mobility of all customers, expanding and making contracts and products more flexible,” according to the AER. Since then, activity in the sector has been recovering strongly, so that in ten years the market has doubled and from the fleet of around 400,000 vehicles in 2013, 2022 closed with more than 850,000 units.

The accumulated turnover so far in 2023 exceeds 5,900 million, compared to 3,500 for the entire year 2013, and the registrations planned for the whole year will be around 900,000 vehicles, as recently indicated by the president of AER, José Martín Castro . By 2025, even one million vehicles are expected to be exceeded, as predicted by the business group, which was born in 1995 with five companies that were dedicated to this business and currently has 130 companies.

The total number of clients accumulated in 2023 is 255,902 -among companies, self-employed people and individuals- which in the case of individuals represents 50.73% of the total. In the third quarter of this year, the average term of contracts between companies in the sector and their users was 45.89 months, compared to 46.76 in the same period of 2022.