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Europe Vehicle Rental Market Size, Share & COVID-19 Impact Analysis, By Duration (Short Term Rental and Long Term Rental), By Vehicle (Passenger Car, Light Truck, Heavy/Medium Truck), By Propulsion (IC Engine Vehicles, Electric Vehicles, Hybrids, and Others), By Application (Passenger Transport, Freight & Logistics, Petrochemicals, Construction & Mining, Industry & Food, Healthcare, and Others), and Regional Forecasts, 2023-2030

Last Updated: May 06, 2024 | Format: PDF | Report ID: FBI107852



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The Europe vehicle rental market size was valued at USD 11.92 billion in 2022. The market is projected to grow from USD 12.55 billion in 2023 to USD 19.46 billion by 2030, exhibiting a CAGR of 6.5% during the forecast period.

Vehicle rental in Europe is the practice of renting or leasing a passenger car or commercial vehicle for the short term and long term. Several companies offer vehicle rental services in Europe, providing a wide variety of vehicles for rent, such as luxury cars, economy cars, and commercial vehicles. Rental vehicles can be picked up at airports, train stations, and other locations throughout Europe. They can be rented for use in a single country or for multiple countries in the region. Rental rates for vehicles in Europe vary depending on the type of vehicle, the length of the rental period, and other factors such as location and demand.

The increasing tourism in Europe is a major factor that drives the market growth in the region. People opt for rental vehicles instead of owning one; companies rent vehicles for their employees for business travel; and the convenience of the rental vehicle over the owned vehicle drives the market. However, high rental prices and strict terms & regulations restrain the market. Also, the low residual value of the vehicle challenges the rental companies for the future growth of the market.


Sharp Decline in the Tourism Industry Owing to Lockdown Hampered the Market

COVID-19 had a massive impact on the European economy. Travel restrictions imposed due to the pandemic resulted in a negative demand across vehicle rental business operations. The COVID-19 pandemic led to the adoption of many unprecedented measures to slow down the spread of the virus. Such measures have significantly impacted the entire industry in Europe. As a consequence, vehicle rentals in the region witnessed a halt in their service.

According to the International Civil Aviation Organization (ICAO), there was an overall reduction in passengers in 2020 compared to the preceding year. It also affected the airport transfer vehicle rental business on a significantly larger scale. Tourism declined in Europe, and rental car owners were compelled to sell a large part of their fleet. Every year, most of the largest car rental companies go through de-fleeting for many purposes. All of those companies were accelerating this exercise in 2020 amid the COVID-19 outbreak to save costs and secure the cash flow for business continuity.

However, as lockdowns were lifted, vehicle rental companies witnessed huge demand as customers preferred rental services over public transportation owing to safety and hygienic reasons. In 2021, vehicle rental gained momentum and will continue its growth over the next few years.


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Technological Advancements to Propel the Europe Vehicle Rental Market Growth

Technology has made it easier for customers to book and reserve rental vehicles online, allowing them to choose the type of vehicle, rental period, and pickup and drop locations. This made the rental process more efficient and convenient for both customers and vehicle rental companies.

Several companies have developed mobile applications that allow customers to access their information, make reservations, and make payments. These apps also allow customers to track their rental status and communicate with the rental company if there are any issues. For instance, in July 2022, Stellantis' vehicle rental segment, Free2move, developed the vehicle rental application that is designed to offer its customers seamless access to vehicles that are not available with any broker. The company offers a range of services, satisfying customers from one minute to several days or months with car-sharing service, short, medium, or long-term rentals, as well as the reservation of VTC drivers, charging stations, and parking spaces via the app.

Rental companies are using technologies, such as GPS tracking and telematics, to monitor the location and condition of their vehicles. This helps the rental companies to ensure the safety and maintenance of their fleet and to improve the rental experience for customers, fueling the growth of the market during the forecast period.


Increasing Tourism in Europe to Drive the Market Growth

The increasing spending capacity of people and businesses running across countries in Europe have increased the movement of the populace. This market plays a key role in the tourism sector, providing easy and cost-effective transportation solutions for people.

In Spain, around 114 million tourists stayed overnight in 2021, which was 19% of the total tourists in Europe. However, according to the World Tourism Organization, international tourist arrivals in Europe decreased due to COVID-19 in 2020, with a decline of -68.49% as compared to 2019. After the COVID-19 pandemic, Europe witnessed a rise of 28.9% in tourist arrivals in 2021.

Meanwhile, the increase in tourism is creating a shortage of rental vehicles. For instance, in April 2022, the rise in tourism in Spain resulted in a shortage of rental cars in the country. The Association of Canary Vehicle Rental Companies (AECAV) houses 50,000 vehicles, but estimates that it would require at least 65,000 vehicles to meet the demand. This fuels the demand for rental vehicles in the region that drives this market.

Expansion Approach of Major Players Fuels the Market Growth

In recent years, the European countries has seen increase in tourism due to education and business opportunities, particularly in Central and Eastern Europe. As a result, several countries especially in Eastern and Southern Europe, have increased their investment in transport and business infrastructure development. Several major global players are expanding their services in Europe, which fuels the market growth in Europe.

For instance, in August 2022, Carwiz, a leading rent-a-car company, announced its plans to expand into the Kosovo and Slovakia markets. The company is expected to open its offices at Pristina Airport and Gnjilan, and in Slovakia at Bratislava Airport.

In September 2022, European rental electric vehicle provider company UFOdrive announced its launch in Spain, expanding its business across Europe. Consumers visiting the Plaza de Colón location can book and drive EVs, including the Tesla Model S, Jaguar I-Pace, and Audi E-Tron, using UFODrive’s iPhone or Android app.

These initiatives performed by the major global and regional players for expanding the rental vehicle business in Europe drive the market.


Higher Rental Prices and Strict Terms and Conditions Restrain the Growth of the Market

Vehicle rental prices are higher than the cost of public transportation. Therefore, people can opt for alternatives to vehicle rentals with less traveling expenditures, such as public transport, taxis, bikes, or services, including car sharing and carpooling. Moreover, extra charges, hidden chargers, and additional prices add to the cost of the service, thus hindering its growth in the region.

Additionally, rental companies have strict terms and conditions. Heavy penalties or fines are levied if the vehicle is damaged or violates some traffic rules. The driver must hold a driving license and an international driving permit and be of legal driving age.

Besides this, the major players are focused on developing services and solutions to rent vehicles efficiently. With the adoption of telematics and several other advanced technologies, companies are focusing on providing efficient vehicle rental solutions to their consumers. However, the incorporation of telematics and advanced connectivity technologies increases the cost of the vehicle, which increases the cost of the rental services. This hampers the growth of the market in Europe. All these factors restrain the growth of the market during the forecast period.


By Duration Analysis

Rise in Tourism and Convenience of Rental Vehicles Drive the Short Term Rental Segment Growth

Based on duration, the market is bifurcated into short term rental and long term rental.

The short term rental segment dominated the market with a significant market share in 2022 and is expected to grow at the fastest CAGR over the forecast period. Renting a vehicle for a short period of time has become more convenient than owning a car, especially for people who are traveling or who only need a vehicle on occasion. This surges the demand for car rentals for a short term.

The long term rental segment accounted for a substantial market share in 2022 and is expected to grow at a decent CAGR during the forecast period. The growth is attributed to the business needs. Many businesses or organizations rent vehicles for their employees to use for work-related travel. This provides a cost-effective option than buying a fleet of vehicles, thus fueling the growth of the segment in Europe.

By Vehicle Analysis

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Rising E-commerce Industry and Business Needs Drive the Passenger Car Segment Growth

Based on vehicle, the market is divided into passenger car, light truck, and heavy/medium truck.

The passenger car segment led the market with the largest market share in 2022. The segment is also anticipated to grow at the fastest CAGR, thus making it the fastest growing segment in the market. Increasing rental services for airport transportation and business needs drive the demand for passenger car rental services in Europe.

The light truck segment accounted for a significant market share in 2022. The segmental growth is anticipated to rise due to the boom of the e-commerce industry. With the boom in the e-commerce industry, major e-commerce companies rent light trucks to deliver products to customers rather than owning a fleet of vehicles. This boosts the light truck segment.

The heavy/medium truck segment accounted for a substantial market share in 2022. The growth is attributed to increased transportation of goods across Europe due to increased e-commerce and several businesses that require the transportation of goods, thus fueling the market growth in the region.

By Propulsion Analysis

Availability of a Wide Range of Services Drives the IC Engine Vehicles Segment Growth

Based on propulsion, the market is split into IC engine vehicles, electric vehicles, hybrids, and others.

The IC engine vehicles segment accounted for the largest market share in 2022. This segment is expected to dominate the market in Europe during the forecast period. Availability of a large number of options in conjunction with flexibility as compared to public transportation will drive the segment’s growth in the future.

The electric vehicle segment will grow at a rapid pace with a decent CAGR during the forecast period. Strict regulatory norms to curb vehicle emissions will propel the penetration of electric vehicles within the rental industry in the future.

The hybrids segment is anticipated to grow at a decent CAGR during the forecast period. Superior fuel efficiency and less pollution will bolster the growth of hybrid vehicles in the vehicle rental industry over the next few years.

By Application Analysis

Rental Vehicles Drive the Passenger Transport Segment Growth

Based on application, the market is split into passenger transport, freight & logistics, petrochemicals, construction & mining, industry & food, healthcare, and others.

The passenger transport segment dominated the market with the largest market share in 2022. The rising adoption of rental vehicles for leisure activities will propel the segment’s growth during the forecast period.

The healthcare segment will grow at a rapid pace during the forecast period. Rising government expenditure and investments will propel the healthcare segment's growth. Moreover, supportive government policies will assist in industry growth.

The goods & logistics segment accounted for a significant market share in 2022. The growth in the e-commerce industry, along with the positive outlook of the manufacturing sector, will support market growth in future.

The others segment includes petrochemicals, construction & mining, industry & food, and others. It is anticipated to grow with a decent CAGR over the forecast period. The growth is attributed to the convenience of rental vehicles over owned vehicles, which drives the market growth in Europe.


Germany dominated with a market size of 2.30 billion in 2022. The shift of major players toward the adoption of electric vehicles in their fleets drives the domestic market.

The U.K. accounted for a significant Europe vehicle rental market share in 2022, and is anticipated to grow at the fastest CAGR over the forecast period, making it the fastest-growing country in the region. The growth is attributed to increased transportation of goods due to rise in the e-commerce industry.

France accounted for a substantial market share in 2022. Digitalization of the operation of rental services and the expansion of fleets by several major companies drive the market in the country and across the region.

Spain witnessed a considerable market share in 2022. The growth is attributed to the increasing demand for rental vehicles due to shortage of vehicles for tourists.

The rest of European market growth is attributed to the development of infrastructure for the adoption of electric rental vehicles by the governments of several countries in Europe, thereby driving the market growth in the region.


Focus on the Development of Europe Vehicle Rental Services to Drive the Competition

The market is led by several global players operating in this industry. The key players are focused on product differentiation & development, mergers & acquisitions, and expansion of sales & distribution networks to gain a competitive advantage.

Europcar is One of the Prominent Companies in the Market 

Europcar operates four brands, such as Europcar, a provider of vehicle rental services; Goldcar, a car-rental company; InterRent, a brand focused on leisure; and Ubeeqo, a company specializing in fleet and mobility solutions for both the business and end-customer markets. Europcar Mobility Group is one of the major players in the mobility market, offering attractive alternatives to vehicle ownership responsibly and sustainably, with a wide range of car and van rental services for a few hours, a few days, a week, a month, or more.

In November 2019, the Europcar Mobility Group acquired Fox Rent-a-Car, a U.S.-based company with revenue of approximately USD 250 million in 2019, operating with 21 corporate station networks in the U.S. and over 100 overseas locations. This acquisition enables the Group to have a direct presence in the U.S., the most prominent car rental market worldwide, and to reap the full benefits of the U.S.-Europe/Rest of the World traffic flows in both directions.



  • October 2022 - SIXT and BYD, the world’s largest manufacturer of New Energy Vehicles, signed an agreement. In this agreement, SIXT ordered several thousand pure-electric vehicles from BYD, which will be made available initially for SIXT customers in Europe in Q4 2022. This initial order forms the first step in an agreement envisaging the purchase of around 100,000 additional electric vehicles over the following six years. In addition, BYD and SIXT will explore potential cooperation opportunities in different regions worldwide.

  • September 2022 - Petit Forestier Group, the European leader in refrigerated vehicle rental and leasing, signed a Memorandum of Understanding with IVECO, a leader in alternative propulsion commercial vehicles, for the supply of 2,000 daily chassis cabs and delivery of 200 vehicles planned for 2023. The vehicles are to be fitted with refrigerated bodies.

  • April 2022 - TIP Trailer Services signed a deal to acquire Ryder Ltd.'s trailer leasing and maintenance business. Ryder Ltd. is a leading provider of commercial vehicle rental, maintenance, and dedicated delivery solutions in the U.K. TIP will integrate Ryder assets into its existing U.K. business, enriching its fleet with around 3,550 additional trailers and expanding the number of workshops in the U.K. to 18.

  • January 2021 - Europcar Mobility Group announced the establishment of a Nordic Cluster across Europcar Mobility Group businesses in Denmark, Finland, and Norway. The Nordic Cluster is part of the Group’s ongoing business transformation and will allow the optimization of business processes across three countries - by leveraging best practices and mutualizing expertise locally.

  • August 2020 - Lyft partnered with SIXT to expand its friction-free car rentals nationwide. As part of the partnership, users will be able to rent a SIXT car through the Lyft app, initially in three U.S. cities and expanding to all cities within the SIXT network in the next few months.


An Infographic Representation of Europe Vehicle Rental Market

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The research report provides a detailed analysis of the market and focuses on key aspects such as leading companies, types of services, and their applications in the industry. Besides this, the report offers insights into the market trends and highlights key industry developments. In addition to the factors above, the report encompasses several factors that have contributed to the market growth in recent years.

Report Scope & Segmentation



Study Period


Base Year


Estimated Year


Forecast Period


Historical Period


Growth Rate

CAGR of 6.5% from 2023 to 2030


Value (USD Billion)

By Duration

  • Short Term Rental

  • Long Term Rental

By Vehicle

  • Passenger Car

  • Light Truck

  • Heavy/Medium Truck

By Propulsion

  • IC Engine Vehicles

  • Electric Vehicles

  • Hybrids

  • Others

By Application


  • Passenger Transport

  • Freight & Logistics

  • Petrochemicals

  • Construction & Mining

  • Industry & Food

  • Healthcare

  • Others

By Geography

  • Europe (By Duration, By Vehicle, By Propulsion, By Application)

    • U.K. (By Vehicle, By Duration and By Propulsion)

    • Germany (By Vehicle, By Duration and By Propulsion)

    • France (By Vehicle, By Duration and By Propulsion)

    • Spain (By Vehicle, By Duration and By Propulsion)

    • Poland (By Vehicle, By Duration and By Propulsion)

    • Benelux (By Vehicle, By Duration and By Propulsion)

    • Italy (By Vehicle, By Duration and By Propulsion)

    • Rest of Europe (By Vehicle, By Duration and By Propulsion)

Frequently Asked Questions

Fortune Business Insights says that the market was valued at USD 11.92 billion in 2022, it is estimated to reach USD 19.46 billion in 2030.

The market is expected to register a CAGR of 6.5% during the forecast period 2023-2030.

Increasing tourism in Europe to drive the market growth.

Germany managed to led the Europe market in 2022.

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