What you need to know
The private short-term car and LCV hire market is valued by Mintel at an estimated £1.36 billion in 2019, 8% ahead of its value in 2014. Yes despite the private sector of the market recording overall revenue growth during this period, behind the scenes the sector is under pressure. BVRLA (British Vehicle Rental & Leasing Association) data records a fall in private (leisure) rentals from 6.27 million in 2015 to 5.77 million in 2018 against a corporate market that has registered expansion.
Some explanation for the recent poor performance of the private segment of the short-term hire market can be seen by looking at car and LCV segments of the market. Car rentals have stagnated, and are forecast at 4.86 million in 2019 compared with 4.75 million in 2014. Meanwhile LCV rentals have fallen back from an estimated 1.34 million in 2014 to a forecast at 0.97 million in 2019. With rentals in the commercial sector of the hire market recording expansion, Mintel believes the private segment of the market is being increasingly affected by competition from other forms of personal transport.
Some evidence of the competition being faced by the short-term hire market can be seen from Mintel’s exclusive research for this Report. Although 57% of adults say they are not interested in the more popular alternatives currently offered alongside car hire, a significant minority are with 17% saying they would consider car sharing as well as taxi sharing, 15% ride sharing and 14% peer-to-peer rental. Other key conclusions from our research note the large percentage of adults who haven’t hired a vehicle in the UK for the last two years, 65%, as well as factors associated with vehicle hire. These include the main reason given for hiring in the last two years being moving house (37%) while the two broad areas of importance for consumers when hiring in the UK are convenience and cost.
Products covered in this Report
This Report analyses the market for self-drive private car and LCV hire for non-business use. By vehicle we mean self-drive cars as well as LCVs such as light goods vehicles and minibuses that can be driven without requiring a heavy goods or public service licence.
Any vehicle hired abroad is excluded.
The Report also excludes cars supplied by daily rental companies to car body repair shops as customer courtesy cars or cars supplied as accident replacement vehicles to non-fault victims of a car accident where a car is provided by a credit hire company as a replacement vehicle while their own is being repaired.
Long-term leasing for personal or business use is specifically also omitted from this Report. This is typically offered by dealers as an alternative to the purchase of a vehicle with the cut-off between short-term and long-term being 30 days. It has for many years been used by businesses, and increasingly in the consumer market, as a method of acquiring a vehicle without the need for a substantial upfront payment.
