KSA Car Rental and Leasing Market Outlook to 2028
Region:Middle East
Author(s):Aditi Tewari, Rajat
Product Code:KR1476
February 2025
80
About the Report
KSA Car Rental and Leasing Market Overview
- The Saudi Arabia Car Rental and Leasing Market is valued at SAR 11,567.2 Mn, based on a five-year historical analysis. The market is driven by increasing urbanization, a surge in tourism due to the countrys focus on Vision 2030, and the rise in demand for flexible mobility solutions. The influx of business travelers, expatriates, and domestic consumers preferring rental services over ownership further propels market growth.
- Riyadh, Jeddah, and Dammam dominate the car rental and leasing market in Saudi Arabia due to their status as major business and tourism hubs. Riyadh, being the capital, sees high corporate leasing demand, while Jeddahs strategic location near King Abdulaziz International Airport and Mecca makes it a key area for short-term rentals.
KSA Car Rental and Leasing Market Segmentation
KSA Car Rental and Leasing Market is divided into further segments:
- By Car Dealers: KSA Car Rental and Leasing Market is segmented by car dealers into Car Leasing Companies, and Car Dealers. Car leasing companies dominate the market due to their extensive fleet, flexible rental terms, and strong partnerships with corporate clients. The shift towards mobility solutions over vehicle ownership, particularly among expatriates and short-term residents, further strengthens the segment's growth.
- By Organization: KSA Car Rental and Leasing Market is segmented by organization into organized and unorganized. The organized sector dominates the market due to established infrastructure, large fleet sizes, and strong brand presence. Large and mid-sized companies benefit from economies of scale and long-term corporate leasing contracts.
KSA Car Rental and Leasing Market Competitive Landscape
The Saudi Arabia car rental and leasing market is dominated by leading local players that differentiate themselves based on fleet size, digital presence, and service offerings.
KSA Car Rental and Leasing Industry Analysis
Market Growth Drivers
- Expansion of Tourism and Travel Industry: Vision 2030 fuels tourism growth in Riyadh and AlUla, focusing on cultural, heritage, and luxury destinations to attract global visitors. Red Sea Project boosts coastal tourism in Tabuk, driven by luxury resorts and other leisure activities. Makkah and Madinah expand religious tourism, with infrastructure upgrades and increased pilgrimage capacity, reinforcing their roles as key destinations.
- Non-Oil Sector Diversification: Vision 2030 aims to boost non-oil GDP to 50% by 2030, focusing on sectors like finance, insurance, and manufacturing. Riyadhs Grade A office rents rose 12.9% to SAR 1,900 per square meter, while Jeddah saw a 17.9% increase to SAR 1,356 per square meter in Q3 2023.Developing the manufacturing sector is essential for job creation and reducing import dependency.
- Infrastructure Development: Saudi Arabia has announced a trillion-dollar pipeline of infrastructure projects including Neom, Qiddiya, Riyadh Metro, Makkah Public Transport, and Al Widyan City. The Kingdom aims to position itself as a global hub with initiatives such as airport and seaport expansion projects designed to strengthen the logistics industry.
Market Challenges
- Mounting Investments in Public Transport: Tabuk has recently floated an investment of over $22 million to deploy over 30 buses in the city to support mobility needs. In Malaysia, the automotive aftermarket industry can expect a surge in demand for specialized maintenance services tailored to public transport vehicles. This includes routine inspections, repairs, and compliance with safety regulations.
- Booking & Pricing Management: Managing and keeping booking data is a tedious task, especially during price changes or offering new deals. For instance, if a service center decides to offer a20% discounton oil changes during a specific month, it must ensure that this information is accurately reflected across all platforms (online and offline) to avoid customer confusion and dissatisfaction.
KSA Car Rental and Leasing Future Market Outlook
Over the next five years, the Saudi Arabia car rental and leasing market is expected to experience significant growth reaching a market size of SAR 17,807.8 Mn driven by rising digital booking trends, expansion of smart mobility solutions, and increasing EV penetration. The governments push for sustainable transport and the growth of ride-sharing services like Uber and Careem will further influence market dynamics.
Market Opportunities
- Car Lease Insurance in KSA: The comprehensive insurance rules issued by the Saudi Arabian Monetary Authority (SAMA) for auto lease finance, effective from November 2020, are set to enhance the leasing landscape. These regulations stipulate that the annual insurance premium will be determined by several factors, including the vehicle's insurance value, individual pricing factors, and driving behavior. This could lead to lower costs for safe drivers and promote responsible driving habits.
- EV Adoption and Car Rental Market: The establishment of CEER as Saudi Arabia's first EV brand, alongside Lucid Motors' plans to build a factory in the Kingdom, signifies a strong commitment to electric vehicle adoption. The collaboration between the Saudi sovereign wealth fund PIF and Foxconn has already attracted over$150 millionin foreign direct investment, contributing an estimated$8 billionto GDP by 2034.
Scope of the Report
|
Segment |
Sub-Segments |
|---|---|
|
Dealers |
Car Leasing Companies Car Dealers |
|
Organization |
Organized Unorganized |
|
By Type of Vehicles |
Vehicle Type Small Cars Sedans SUVs and MUVs Pick-up Trucks Premium/Luxury |
Products
Key Target Audience
- Car Rental and Leasing Companies
- Automobile Manufacturers and Dealerships
- Fleet Management Service Providers
- Corporate Travel and Hospitality Sector
- Ride-Hailing and Mobility Companies
- Government and Regulatory Bodies (Transport General Authority, Ministry of Transport and Logistic Services)
- Investors and Venture Capitalist Firms
- Tourism and Pilgrimage Industry Stakeholders
Companies
Players mentioned in the report
- Budget Rent a Car
- Theeb Rent a Car
- Seera-Lumi
- Yelo (Al Wefaq Rent a Car)
- Key Car Rental
Table of Contents
1. Executive Summary
1.1 Executive Summary: KSA Car Rental and Leasing Market
2. Country Overview of KSA
2.1 Country Demographics and Socioeconomic Indicators, 2023
2.2 KSA Population Analysis, 2023
2.3 Tourism in KSA, 2023
2.4 Enterprises Analysis of KSA, 2023
2.5 KSA Employment Analysis, 2023
2.6 Macroeconomic Trends in KSA, 2023
3. KSA Automotive Market Overview
3.1 KSA Automotive Market Overview
3.2 Car Manufacturing Hubs in KSA
3.3 KSA Motor Vehicles Import Export Scenario
3.4 KSA Passenger Car Market Overview
3.5 KSA Passenger Car Pricing
3.6 Major Car Brands and Customer Demographics in the KSA Car Market, 2023
4. KSA Car Rental and Leasing Market Overview
4.1 Ecosystem of KSA Rental and Leasing Market
4.2 KSA Car Rental and Leasing Business Cycle
4.3 Timeline of Major Players in KSA Car Rental and Leasing Market
4.4 KSA Car Rental and Leasing Market Value Chain Analysis
4.5 Seasonality Trends in KSA Car Rental and Leasing Market
5. KSA Car Rental Market Size and Segmentation
5.1 Ecosystem of Car Rental Market
5.2 KSA Car Rental Market Size by Revenue, 2017-2023
5.3 KSA Car Rental Market Size by Fleet Size and Price, 2017-2023
5.4 Segmentation by Organization (Organized and Unorganized), 2023
5.5 Segmentation by Type of Vehicle (Sedan, Small Cars, SUV/MUVs, Pickup Trucks, Luxury), 2023
5.6 Segmentation by Pick-Up Point (On Airport and Off Airport), 2023
5.7 Segmentation by End Users (Commercial, Private, Government), 2023
5.8 Segmentation by Region (Western, Central, Eastern, and Others), 2023
6. KSA Car Leasing Market Size and Segmentation
6.1 KSA Car Leasing Market Ecosystem
6.2 KSA Car Leasing Market Size in Revenue, 2017-2023
6.3 KSA Car Leasing Market Size in Fleet Size, 2017-2023
6.4 Segmentation by Organized and Unorganized, 2023
6.5 Segmentation by Car Dealers and Car Leasing Companies, 2023
6.6 Segmentation by Type of Vehicle (Sedan, Small Cars, SUV/MUVs, Pickup Trucks, Luxury), 2023
6.7 Segmentation by Tenure of Contract (1 Year, 2 Years, 3 Years, 4+ Years), 2023
6.8 Segmentation by End Users (Commercial, Private, and Government), 2023
6.9 Segmentation by Region (Central, Western, Eastern, and Other Regions), 2023
7. Snapshot on Used Car Sales Segment
7.1 Ecosystem and Overview of Used Car Sales
7.2 Value Chain of KSA Car Rental and Leasing Market involving Used Car Sales
7.3 Used Car Sales Revenue, 2017-2028F
7.4 Market Share of Major Car Rental/Leasing Players in Used Car Sales
8. Industry Analysis of KSA Car Rental and Leasing Services
8.1 Porters Five Forces Analysis of Rental and Leasing Market
8.2 Infrastructure Development Overview
8.3 Growth Drivers of KSA Car Rental Market
8.4 Trends and Developments in KSA Car Rental and Leasing Market
8.5 Government Regulations of KSA Car Rental Market
8.6 Government Regulations and EV Adoption in KSA Car Rental Market
8.7 Challenges of KSA Car Rental and Leasing Market
9. End User Analysis of KSA Car Rental and Leasing Market
9.1 Market Share by Commercial End Users, 2023
9.2 Recent Trends Affecting End Users of Leasing Market
9.3 Future Demand Potential of Commercial and Government End Users
9.4 Factors Influencing Choice of Vehicle
10. Competition Framework for KSA Car Rental and Leasing Market
10.1 KSA Car Rental and Leasing Market Competition Sizing by Size and Split of Fleet, 2023
10.2 Fleet Split of Players in KSA Car Rental and Leasing By Type of Car, 2023
10.3 Competition Landscape in KSA Rental Market, 2023
10.4 Competition Landscape in KSA Leasing Market
10.5 Strengths and Weaknesses of Major Players in KSA Car Rental and Leasing Market
10.6 Competitive Cross Comparison
11. Future Outlook of the Industry
11.1 Future Outlook of KSA Car Rental and Leasing Market Size by Revenue, 2023-2028F
11.2 KSA Car Rental and Leasing Market Size by Fleet Size, 2023-2028F
11.3 By End Users (Commercial, Private, and Government), 2028F
11.4 By Region (Central, Western, Eastern, and Others), 2028F
11.5 By Type of Vehicle (Sedan, Small Cars, SUV/MUVs, Pickup Trucks, Luxury), 2028F
12. Future Outlook of KSA Car Rental Market
12.1 Future Market Sizing Analysis of KSA Car Rental Market Size in Revenue, 2023-2028F
12.2 Future Market Sizing Analysis of KSA Car Rental Market Size in Fleet Size, 2023-2028F
12.3 Segmentation by Organized, Unorganized, and Off Airport, 2028F
12.4 Segmentation by Type of Vehicle (Small Cars/Hatchbacks, Sedans, SUVs and MUVs, Pickup Trucks, and Premium/Luxury), 2028F
12.5 Segmentation by End Users (Commercial, Private, and Government), 2028F
13. Future Outlook of KSA Car Leasing Market
13.1 Future Potential of KSA Car Leasing Market Size in Revenue Terms, 2023-2028F
13.2 KSA Car Leasing Market Sizing in Terms of Fleet Size and Price, 2023-2028F
13.3 Segmentation by Organization (Organized and Unorganized) and Company Type (Car Dealer and Car Leaser), 2028F
13.4 Segmentation by Type of Vehicle (Sedan, Small Cars, SUV/MUVs, Pickup Trucks, Luxury), 2028F
13.5 Segmentation by End Users (Commercial, Private, and Government) and by Regions (Western, Central, Eastern, and Others), 2028F
13.6 Segmentation by Tenure of Contract (1 Year, 2 Years, 3 Years, 4+ Years) and by Region, 2028F
14. Case Study of Chinese Rental Market
14.1 Case Study of Chinese Rental Market
14.2 Growth Drivers of Chinese Rental Services Market
15. Analyst Recommendations
15.1 Target Market for KSA Car Rental and Leasing Players
15.2 Adoption Points from Success Case Study
15.3 Unit Economics in KSA Car Rental and Leasing
15.4 Future Growth Strategy for Expansion
Disclaimer
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Research Methodology
Step 1: Secondary Research
The research process begins with extensive secondary research to gather information from various sources such as company profiles, company reports, company annual reports, industry articles, journals, magazines, online articles, and data from various sources. This phase helps in understanding the historical market trends, competitive landscape, and macroeconomic factors affecting the market.
Step 2: Primary Research
Primary research is conducted through Computer Assisted Telephonic Interviews (CATIs) with leading car rental companies operating in KSA. This includes Budget Rent a Car, Key Car Rental, Theeb, Best Rent a Car, Hanco, Avis, Samara/SIXT, Al Jazira Vehicles Agency, Auto World, Universal Motors, Al Jabr, Al Jomaih, Europcar, Lumi, Hertz, Yelo, and Enterprise. These interviews provide first-hand insights from industry experts, validating data obtained from secondary research.
Step 3: Sanity Checking
A general consensus on the data collected from primary research and public or proprietary databases is achieved through an in-house decision tree analysis. This step involves cross-verifying data with macroeconomic factors such as rental prices, short-term leasing trends, fleet size, household disposable income, population size, private consumption expenditure, and GDP per capita income. The fluctuations in these factors are examined over a 10-year timeline (2017-2028F), allowing a thorough assessment of industry trends. The bottom-to-top approach is used to analyze the market share of companies in terms of total revenue generation in the KSA Car Rental market.
Step 4: Research Validation and Final Output
The final step involves analyzing changes in industry proportions such as total fleet size, operational fleet trends, occupancy rates, and average rental prices over the years. This ensures that all changes in the industry have been accounted for, providing a comprehensive, data-backed report on the KSA Car Rental and Leasing Market.
Frequently Asked Questions
01. How big is the Saudi Arabia Car Rental and Leasing Market?
The Saudi Arabia Car Rental and Leasing Market is valued at SAR 11,567.2 Mn, driven by rising tourism, increasing corporate leasing demand, and expanding mobility solutions.
02. What are the key challenges in the Saudi Arabia Car Rental and Leasing Market?
Key challenges in the Saudi Arabia Car Rental and Leasing Market include rising fuel prices, booking and pricing management difficulties, increasing competition from ride-hailing services, and cybersecurity threats affecting online transactions.
03. Who are the major players in the Saudi Arabia Car Rental and Leasing Market?
Leading market players in the Saudi Arabia Car Rental and Leasing Market include Budget Rent a Car, Theeb, Key Car Rental, Best Rent a Car, Hanco, Avis, Samara/SIXT, Al Jazira Vehicles Agency, Auto World, Universal Motors, Al Jabr, Al Jomaih, Europcar, Lumi, Hertz, Yelo, and Enterprise.
04. What are the primary growth drivers of the Saudi Arabia Car Rental and Leasing Market?
Growth in the Saudi Arabia Car Rental and Leasing Market is fueled by Vision 2030 initiatives, increasing urbanization, the expansion of smart mobility solutions, digital transformation in the booking process, and rising demand for flexible transportation services.
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