Market Trends of Europe Tourism Vehicle Rental Industry
Rising Tourism Activities is Likely to Drive Leisure/Tourism Application Segment of the Market
- The outstanding growth industry of tourism-supplementing business, professional, and student travel-brings employment and foreign exchange to many Europeans, especially in the Mediterranean countries, with their combination of sunshine, beaches, scenery, and historical monuments. The world-renowned cities of Europe attract large numbers of tourists as well. In fact, European countries are consistently among the top tourist destinations of the world; they draw visitors from within Europe as well as from other continents.
- In July 2023, The European Commission announced the 2024 European Capital of Smart Tourism and European Green Pioneer of Smart Tourism competitions, inviting cities to submit their leading examples of smart and sustainable tourism practices in Europe.
- The Spanish government has authorized a total expenditure of EUR 110 million from Next Generation EU funding to strengthen tourist competitiveness in numerous territories, including the Balearic Islands, Canary Islands, Ceuta, and Melilla. The government stated on June 14 that the Council of Ministers had also enacted a Royal Decree permitting the government to pay EUR 50 million to each of the autonomous island communities and EUR 5 million to each of the autonomous cities.
- According to an industry association, Spain's tourist sector has witnessed an increase in revenues above pre-pandemic levels, while inflation might trigger a downturn in activity for the remainder of 2022. Domestic visitors led the significant recovery, offsetting a drop in arrivals from certain important overseas markets.
- The administration has also stated that these special subsidies for the island, as well as Ceuta and Melilla, are designed to satisfy the Spanish government's obligation. It further states that by the second quarter of 2025, at least 400 off-peninsular territory beneficiaries must have completed initiatives to strengthen their competitiveness and capacity to respond to changes in international markets.
- Based on such developments, the market is expected to boom during the forecast period.
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Online Booking Segment Likely to Drive Demand in the Market
- The online booking segment of the market studied is anticipated to contribute significantly during the forecast period. As online rental services have the advantage of reliability, convenience of use, vehicle and data management, fast payments, and better sales management over conventional new ones, the demand for rental vehicles, especially by tourists, is expected to rise over the forecast period. The concern of paying expenses associated with possessing the ownership of a car is reduced due to vehicle rental services.
- With the advent of digital and sharing economies, the online tourism vehicle rental industry is witnessing positive growth, and the pandemic aggravated the necessity and benefits of its offline booking services. The presence of vehicle rentals on online platforms has increased sales significantly. Besides, the agencies are offering seasonal offers, group discounts, etc., attracting a lot of consumers. Additionally, the reach of tourism vehicle rentals has increased drastically due to digitization. For example, companies such as Enterprise Holdings Inc. are offering customers an interactive tool for vehicle modification, helping customers reduce procurement time.
- In addition, rental service providers are also entering into collaborations with airlines to attract consumers, especially tourists, through online booking mediums, as it is expected to ease the process of booking vehicles for rental purposes.
- In July 2023, Electric vehicle subscription service Onto raised USD 60 million in funding for its European expansion. Because of the innovative business model, people can subscribe to an electric car on a monthly basis. With no upfront deposit or long-term commitment, the subscriptions include public transportation, insurance, and breakdown coverage. By offering consumers a truly flexible subscription option, Onto is upending traditional ownership models.
- Hence, such developments are expected to rise, and hence, the demand in the market is anticipated to increase with influx of travelers across the region during the forecast period.
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