What happened? The pandemic, the chip shortage, and the war in Ukraine, for starters. But this isn’t just a short-term shock; the car rental market could be changed forever. That’s likely to mean permanently higher prices, an influx of electric cars, and the appearance of Chinese brands–and perhaps even the rise of peer-to-peer car sharing as a mainstream alternative, if enough people are willing to share their cars with strangers.
Things started to break down in early 2020, when lockdowns around the world resulted in the car rental market falling off a cliff. Almost two-thirds of Avis-Budget’s rental business at airports vanished, with revenues company-wide sliding 41 percentyear-on-year in 2020. At Europcar, 2020 revenue was down 42 percent, and Hertz’s revenue fell 46 percent before it filed for bankruptcy–though it has since restructured and recovered.
In response to the mayhem, rental companies sold off their cars. In the UK, fleets were slashed by 30 percent, according to the British Vehicle Rental and Leasing Association (BVRLA), a car rental membership organization. In 2019, Hertz had 700,000 vehicles globally. In the first quarter of 2022, that collapsed to 481,000, according to a company spokesperson. Europcar’s fleet size numbered 293,000 vehicles in the first quarter of 2020 but plunged to 187,200 in 2021.
***
lennyesq 