Saudi Arabia expects car rental market to grow by USD1.3B by 2028

(MENAFN) The car rental market in Saudi Arabia is undergoing significant changes, reflecting the Kingdom's broader economic and social advancements. A report by Glasgow Research and Consulting predicts the market will grow from USD772 million in 2023 to USD1.3 billion by 2028, with a compound annual growth rate of 9.7 percent. This expansion is fueled by an increasing number of companies adopting rental solutions and a rise in local and expatriate employees. Additionally, the decision to allow women to drive has spurred new demand, altering car rental consumption patterns across the Kingdom.

Corporate leasing dominates the market, accounting for 81 percent of operations, while private leasing comprises the remaining 19 percent. The report highlights that sedans, such as the Toyota Camry and Hyundai Sonata, are the most popular, making up 43 percent of rentals. SUVs follow with 39 percent, and luxury vehicles like the Mercedes-Benz E-Class and BMW 7 Series hold a smaller 8 percent share. Despite the smaller proportion, demand for luxury rentals is growing as customers increasingly seek premium experiences.

Digital transformation is playing a pivotal role in the sector's growth. Online platforms are projected to account for 62 percent of total revenues by 2029, underlining the need for companies to adopt digital solutions. These platforms are not only enhancing customer experience but also streamlining access to services, making rentals more accessible and convenient. This shift is reshaping how car rental businesses operate in Saudi Arabia.

The financial outlook for the market remains robust, with revenues expected to reach USD1.13 billion in 2024 and continue rising to USD1.32 billion by 2029. The combination of technological integration, evolving social dynamics, and growing corporate demand ensures a promising future for the car rental industry in the Kingdom.

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