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What to expect in the car rental business in 2021?

2020 has been a disaster for many car rental companies. In April, car rental sales fell by an average of 85% and the losses could not have been made up even during the summer season when most car rental companies were forced to reduce their fleet.

Due to the constantly changing situation, at the moment it is not possible to certainly predict what the new year will bring. However, one thing is for sure - for many car rental companies, the upcoming year will be the decisive one. In our article, we will summarize the factors that might be crucial in the area of car rentals in 2021.

New travel trends

The aviation industry is currently paralyzed and may take several years to fully recover. Although fly ticket prices to many destinations are significantly lower than they used to be before the pandemic, more and more people prefer to travel locally by car. That makes sense since individual transport can reduce the risk of getting infected by the COVID-19 to a minimum and may also save you from a mandatory quarantine or testing. This trend is likely to enhance throughout 2021 due to the recurring cyclical waves of the COVID-19.

Higher demand vs fewer vehicles

As this year many of the car rental companies have had to close their businesses or reduce the number of cars in their fleet, the number of vehicles for rent on the market is currently significantly lower than it used to be before the pandemic. Equally problematic will be the financing of new cars. The low number of cars on the market combined with the expected increased demand for car rentals will cause an increase in rental prices. This could significantly improve the situation of car rental companies.

The changing customer

Under the influence of the COVID-19 pandemic, customer expectations have increased significantly. When choosing a vehicle, customers prefer car rental companies that take care of thorough disinfection of vehicles. They are also increasingly looking for contactless rentals which are likely to experience a "boom" in the car rental business in the upcoming year. In this context, the flexibility and ability of car rental companies to incorporate new practices into their established business models will be very important.

When to expect an improvement in the situation?

A question to which no one has a clear answer today. However, it can be assumed that the first half of 2021 will be marked by local travel. People are generally tired of quarantine and the interest in roadtrips in their home or neighboring countries will gradually increase. The situation could improve significantly in the second half of the year with the arrival of the COVID-19 vaccine for the public.

How to prepare for 2021?

Try to be flexible and creative! Use this challenging period to think about suitable strategies to attract new customers and prepare promotions for them. At Rentalport, we are constantly trying to come up with new ideas on how to help our business partners and we will be happy to get new suggestions or tips from your side ????