China Car Rental Market Size, Share, Opportunities, And Trends Type (Economy Cars, Luxury Cars, Executive Cars, SUVs, MUVs), Mode of Booking (Online, Offline), Rental Category (Local Transport, Airport Transport, Outstation Transport, Others) - Forecasts From 2022 to 207

Description

China Car Rental Market is anticipated to expand at a high CAGR over the forecast period.

China Car Rental Market Key Highlights

• New Energy Vehicle (NEV) Fleet Penetration: Government policy and consumer preference drive a mandated fleet transition, positioning major car manufacturers (e.g., BYD, Geely, SAIC) as critical supply chain partners in the rental market.
• Digital Booking Channel Dominance: Over 85% of car rental bookings now route through mobile applications and proprietary online platforms, rendering the offline agency model increasingly marginalized in terms of transactional volume.
• Policy-Driven Demand Catalyst: Stringent municipal vehicle ownership restrictions, specifically license plate quotas in Tier 1 cities (e.g., Beijing, Shanghai), directly convert latent ownership requirement into immediate rental and mobility service demand.
• Strategic Vehicle Procurement Shift: Major domestic rental operators are forging direct, deep strategic partnerships with leading NEV original equipment manufacturers (OEMs), such as the alliance between CAR Inc. and BYD, to secure cost-competitive, high-tech fleet volumes.

The Chinese Car Rental Market operates within the world’s most dynamic mobility ecosystem, characterized by rapid technological integration and powerful regulatory influence. This environment necessitates a unique operational paradigm where car rental is not merely a transport alternative but an intrinsic component of the country’s managed urban mobility and domestic tourism strategy. The market's trajectory is primarily shaped by a growing urban professional class seeking convenience and flexibility, coupled with a surge in self-drive domestic tourism, which has become a primary driver of non-urban rental services. Furthermore, the Chinese government’s aggressive push for electrification compels rental companies to undertake massive fleet reconfigurations, transforming them from general automotive consumers into specialized purchasers of New Energy Vehicles and associated digital infrastructure.

China Car Rental Market Analysis

Growth Drivers

Urban population density and stringent municipal vehicle ownership policies are the foremost demand catalysts. Specifically, restrictive license plate quotas in major metropolitan areas, such as Beijing and Shanghai, effectively constrain private car ownership, compelling a large segment of the consumer base to rely on high-frequency, short-term rental solutions, thereby increasing the overall rental demand pool. Concurrently, the post-pandemic surge in domestic self-drive tourism drives higher utilization rates for weekend and holiday rental categories. This shift in leisure preference directly increases demand for larger segment vehicles (SUVs/MUVs) for extended outstation travel, translating travel intentions into direct rental transactions.

Challenges and Opportunities

A primary challenge remains the capital intensity of mandated fleet electrification. The high initial procurement cost of New Energy Vehicles (NEVs) and the rapid depreciation of existing internal combustion engine (ICE) fleets impose significant financial constraints on operators, potentially decreasing net profitability and slowing overall capacity expansion. However, this challenge simultaneously presents a major opportunity: the government’s robust support for NEVs, including substantial subsidies for charging infrastructure expansion, acts as a powerful growth catalyst for NEV rentals. Operators who successfully integrate new models and charging services can increase demand by catering to a tech-savvy consumer base seeking lower running costs and adherence to green mobility mandates.

Supply Chain Analysis

The car rental supply chain is primarily a sophisticated fleet acquisition and management lifecycle, heavily dependent on domestic Original Equipment Manufacturers (OEMs). The foundational logistical complexity lies in the large-scale, systematic procurement of vehicles, now dramatically pivoting toward NEVs, requiring strategic partnerships with manufacturers like BYD, SAIC, and Geely. This shift introduces a new dependency on battery supply chain stability and localized after-sales service network capacity. Key dependencies include the consistent supply of high-performance EV batteries and the logistical complexity of deploying and maintaining a geographically distributed fleet of specialized vehicles that require distinct charging and maintenance infrastructure, thereby directly influencing fleet availability and subsequent consumer demand.

Government Regulations

In-Depth Segment Analysis

By Type: Economy Cars

The Economy Car segment remains the core volume driver, fundamentally rooted in high-frequency, price-sensitive use cases such as local business commutes and short-term urban travel. Its necessity is directly driven by the cost-sensitivity of the growing middle class and the tactical, daily mobility needs of a vast urban population unable to secure private vehicle plates. The segment benefits disproportionately from high utilisation rates in Tier 1 and Tier 2 cities, where the competitive pricing model—supported by domestic OEM relationships providing low-cost, mass-market fleet vehicles—makes rental a highly viable economic alternative to ride-hailing for full-day or multi-day journeys. Furthermore, the push for smaller, entry-level NEVs, often categorized as economy models, receives government support, which effectively subsidizes the rental companies’ capital costs, allowing them to increase the affordability and, consequently, the demand for this segment. The simplicity of maintenance and low operating expenditure inherent in a large, standardized economy fleet further secures its position as the foundational block of market trends.

By Mode of Booking: Online

The Online Mode of Booking segment has achieved critical mass, with over 85% of total transactions executed via mobile applications and direct online channels. The need for this mode is purely driven by the imperative for instant, transparent pricing and the cultural expectation of seamless digital integration. Proprietary operator apps enable real-time fleet availability checks, guaranteed reservations, and integrated digital payment solutions, which drastically reduce friction in the transaction process. The ability to manage the entire customer journey digitally—from booking and keyless vehicle access to digital contract signing and post-rental payment—is a non-negotiable expectation for the young, tech-native Chinese consumer. This digital infrastructure directly increases consumer demand by enhancing speed, reliability, and service transparency, thereby allowing operators to capture impulse bookings and successfully manage surge demand during peak travel periods, such as major national holidays.

Competitive Environment and Analysis

The Chinese Car Rental Market features a competitive landscape where international firms compete with dominant, agile domestic players. The operational scale and localized network density of domestic firms often provide a competitive edge, especially concerning compliance with evolving NEV fleet mandates and localized service delivery. Key players leverage distinct strategic positioning to capture different market segments.

CAR Inc.

CAR Inc. is one of the largest domestic operators, focused on nationwide network density and fleet scale. Its strategic positioning is centered on leveraging technology for efficient fleet management and maximizing market share in the fast-growing NEV sector. The company is actively forging deep supply chain alliances.

In May 2025, CAR Inc. and BYD officially signed a strategic cooperation agreement focused on deepening NEV procurement for the 2025 summer season and collaborating on used car business models and brand synergy. This move secures a major NEV supply stream and addresses fleet residual value management, a critical operational component.

Hertz

Hertz maintains a premium position, leveraging its global brand recognition to target international business travelers and high-end domestic tourism. The company typically focuses on airport and high-traffic business district locations.

Hertz, in partnership with other global players, continues to utilize its long-established global reservation system and brand standards to secure the high-margin international corporate travel segment, relying on a localized, joint-venture operational structure in China to adhere to domestic regulations.

Avis Budget

Avis Budget operates a multi-brand strategy, segmenting its offering to address both premium corporate clients (Avis) and value-conscious leisure travelers (Budget). Portfolio brand differentiation and technology integration for seamless check-in/out experiences.

The company leverages its global fleet purchasing power and technological platforms to offer a differentiated service suite, focusing on corporate leasing and long-term rental solutions as a stable revenue anchor alongside its core short-term rental business.

Recent Market Developments

• May 2025: In a critical development for fleet transition and supply chain security, CAR Inc. and automaker BYD announced a deeper strategic cooperation, signing a partnership agreement to expand NEV vehicle procurement for the 2025 peak summer season. This alliance extends beyond simple sales, incorporating collaboration on operational optimization, joint marketing, and used car business models. This move directly increases the rental sector's NEV capacity and establishes a formal channel for managing the residual value of battery-electric rental assets, a key industry constraint.
• December 2024: SAIC Anji Logistics, a major logistics arm of automaker SAIC Motor, secured strategic investment from COSCO SHIPPING and Shanghai International Port (Group) Co., Ltd. (SIPG). COSCO SHIPPING and SIPG each subscribed to new shares. This injection of capital and expertise from two major state-owned logistics and port entities directly enhances the capacity and efficiency of the automotive and rental fleet supply chain, particularly for managing the distribution and export of vehicles, thereby indirectly stabilizing the domestic supply for rental companies.

China Car Rental Market Segmentation

• Type
  • Economy Cars
  • Luxury Cars
  • Executive Cars
  • SUVs
  • MUVs
• Mode of Booking
  • Online
  • Offline
• Rental Category
  • Local Transport
  • Airport Transport
  • Outstation Transport
  • Others

Table Of Contents

1. Introduction

2. Research Methodology

3. Executive Summary

4. Market Dynamics

4.1. Market Overview and Segmentations

4.2. Drivers

4.3. Restraints

4.4. Opportunities

4.5. Supplier Outlook

4.6. Industry Outlook

4.7. Porter's 5 Forces Analysis

4.8. Industry Value Chain Analysis

4.9. Scenario Analysis

5. China Car Rental Market Forecast by Car Type (US$ billion)

5.1. Economy Cars

5.2. Luxury Cars

5.3. Executive Cars

5.4. SUVs

5.5. MUVs

6. China Car Rental Market Forecast by Mode of Booking (US$ billion)

6.1. Online

6.2. Offline

7. China Car Rental Market Forecast by Rental Category (US$ billion)

7.1. Local Transport

7.2. Airport Transport

7.3. Outstation Transport

7.4. Others

8. Competitive Intelligence

8.1. Market Share of Key Players

8.2. Investment Analysis

8.3. Recent Deals

8.4. Strategies of Key Players

9. Company Profiles

9.1. Hertz

9.2. Europcar

9.3. Avis Budget

9.4. Sixt

9.5. Carzonrent

9.6. Six Rent A Car

9.7. Enterprise Rent-A-Car

9.8. Enterprise Holding

9.9. Irish Car Rental

9.10. Trust Middle East Car Rental

LIST OF FIGURES

LIST OF TABLES

Companies Profiled

Hertz

Europcar

Avis Budget

Sixt

Carzonrent

Six Rent A Car

Enterprise Rent-A-Car

Enterprise Holding

Irish Car Rental

Trust Middle East Car Rental

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