Market Trends of Thailand Car Rental Industry
Tourism Application Segment to Hold a Significant Market Share
Tourism in Thailand is well-known for its attractions. Thailand is a popular holiday destination for people worldwide. Travelers have a variety of options for getting around the nation, including airlines that connect the major provinces, airport shuttles, rental buses and coaches, special transfers like limo services with experienced chauffeurs, car and other vehicle rentals, trains, boats and yachts, motorcycle and scooter rentals, cycling, and many other modes.
Prior to now, public transportation options like buses, trains, airplanes, and other kinds of transportation served both Thais and tourists' travel needs. A desire for an alternate mode of transportation has grown as a result of increased tourist numbers and traffic congestion in the nation's major cities.
- In 2023, the number of tourist arrivals amounted to around 28.15 million, which drastically increased from the previous years, which was approximately 11 million.
- Thailand's GDP depends heavily on foreign tourism income. The growth in tourism is expected to alter the travel industry's environment and generate a strong need for both the public and private associated sectors, like car rentals and hospitality.
In July 2022, The Tourism Authority of Thailand (TAT) unveiled its marketing strategy for 2023 to maintain the objective of revitalizing and transforming Thai tourism while focusing more emphasis on the sector's recovery in order to achieve stronger and more inclusive tourism growth.
Online Booking Segment to Fuel High Growth Rate in the Market
Online booking services include booking cars via internet sites and mobile applications, among which booking-via-sites is the most common method opted for by renters. Moreover, the rising internet penetration rate, coupled with the convenience of using online services for car leasing and rental services, are significant determinants of the growth of this market segment.
- In 2023, Thailand had over 58.25 million digital populations across the country. This figure is projected to grow over the forecast period, indicating a big market potential for online booking services for the country.
Thailand's car rental market is highly competitive, with both organized and unorganized players present. Thailand's organized car rental market controls the majority of the market. The organized channel is growing in popularity due to the large number of fleet sizes available, which include numerous benefits such as a technologically advanced online booking system, trained and verified drivers, and mileage-based discounts, among others.
With about a million private passenger cars on the road, Bangkok is the most crowded city in the world. This has created a chance for the nation's current car rental and taxi aggregator companies to test a ride-sharing or carpooling segment for their business model.
With government efforts to curb emissions, more hybrid-electric vehicles (HEVs), plug-in hybrid vehicles (PHEVs), and battery electric cars are anticipated to be added to rental car fleets as part of government measures to reduce carbon emissions. Due to the high retail price of electric vehicles, their rental rates are likely to be greater than those for gasoline-powered vehicles.
With more tourists seeking convenient and flexible transportation options, coupled with the widespread availability of online platforms and secure payment systems, the car rental and leasing industry is poised for substantial growth over the forecast period.
