Global Electric Car Rental Market By Vehicle Type (Hybrid Cars, Battery Cars, Plug-in Electric Cars), By Application (Economic Cars, Exclusive Cars, Others), By Service (Online, Offline), By Region and Companies - Industry Segment Outlook, Market Assessment, Competition Scenario, Trends and Forecast 2024-2033

Report Overview

The Global Electric Car Rental Market size is expected to be worth around USD 45.3 Billion by 2033, from USD 13.1 Billion in 2023, growing at a CAGR of 13.2% during the forecast period from 2024 to 2033.

Electric car rental refers to the service that allows consumers, businesses, or tourists to rent electric vehicles (EVs) for short-term or long-term use. This service offers a flexible, eco-friendly alternative to traditional gasoline-powered car rentals, helping to reduce carbon emissions and dependence on fossil fuels.

The market for electric car rentals is driven by the growing adoption of EVs, increased consumer awareness of environmental issues, and government incentives supporting greener transportation options. It includes both large international car rental companies offering electric vehicles as part of their fleet and emerging local providers serving specific regions or niches.

The electric car rental market has experienced strong growth in recent years. For instance, in 2022, the number of electric vehicles available for rental in the U.S. increased by 12%, while in Europe, electric vehicle rentals grew by 17% year-over-year, driven by the EU’s green recovery plan. This growth reflects a broader trend toward sustainability and increasing consumer demand for eco-friendly mobility options.

Looking ahead, the market presents significant growth opportunities, especially in regions with expanding electric vehicle infrastructure. Governments are offering incentives such as tax rebates, subsidies, and investments in charging networks to encourage the transition to electric mobility.

In 2024, the U.S. is projected to see a 20% increase in electric car sales, further boosting the availability of EVs for rental purposes. This trend, along with shifting consumer preferences, positions the electric car rental market for continued expansion.

Government support, both in terms of financial incentives and infrastructure development, plays a key role in the growth of the electric car rental market. For example, the Australian government has committed $76 million to electric vehicle projects and $199 million to building EV charging infrastructure. These efforts are aimed at making EVs more accessible and convenient for consumers, further driving demand for electric car rentals.

In addition, the global shift toward EV adoption is gaining momentum, with electric vehicles accounting for nearly 16% of global passenger car sales in 2023, a 2.8 percentage point increase from the previous year. As more consumers embrace electric vehicles, car rental companies are expanding their EV fleets to meet demand, especially in urban areas where sustainable transportation options are increasingly popular.

With supportive policies and growing infrastructure, the electric car rental market is poised for sustained growth, driven by both the expanding availability of electric vehicles and the increasing demand for eco-friendly travel options.

Key Takeaways

• The global electric car rental market is projected to reach USD 45.3 Billion by 2033, growing at a CAGR of 13.2% from 2024 to 2033.
• In 2023, hybrid cars dominated the market due to their fuel efficiency and reduced environmental impact, meeting the growing demand for sustainable mobility solutions.
• Economic electric cars led the market in 2023, driven by their affordability, practicality, and appeal to budget-conscious consumers.
• The online segment held a dominant share in 2023, as consumers increasingly favored digital platforms for their convenience, cost-effectiveness, and ease of use.
• North America is the leading region in the electric car rental market, fueled by strong government support, extensive EV infrastructure, and rising consumer preference for eco-friendly transport.

Vehicle Type Analysis

In 2023, Hybrid Cars Dominated the Electric Car Rental Market by Vehicle Type

In 2023, Hybrid Cars held a dominant market position in the By Vehicle Type Analysis segment of the Electric Car Rental Market. This was driven by their balanced energy consumption, combining the benefits of both electric and internal combustion engines.

Hybrid vehicles are widely recognized for their fuel efficiency and reduced environmental impact, which aligns with the increasing consumer demand for sustainable and cost-effective mobility solutions.

Battery Electric Cars (BEVs) accounted for a significant share of the market as well, driven by advancements in Ev battery technology and the expanding charging infrastructure. BEVs offer zero emissions and are seen as a key solution in reducing carbon footprints, making them a popular choice for environmentally conscious renters.

Plug-in Electric Cars (PHEVs), while growing in popularity, held a smaller share compared to hybrids and BEVs. PHEVs offer the flexibility of both electric and gasoline power but tend to be less popular due to shorter electric-only ranges and higher initial costs compared to hybrids. However, their adoption is expected to rise as technology improves and consumer preferences shift towards more versatile electric mobility solutions.

Overall, hybrid cars remain the preferred choice in the electric car rental market, driven by their balanced performance, cost-efficiency, and broad consumer appeal.

Application Analysis

Economic Cars Dominate the Electric Car Rental Market by Application in 2023

In 2023, Economic Cars held a dominant market position in the By Application Analysis segment of the Electric Car Rental Market, capturing the largest share of rental applications. The preference for economic electric vehicles can be attributed to their affordability, practicality, and wide appeal among budget-conscious consumers.

With a growing emphasis on reducing carbon footprints and adopting cost-effective transportation solutions, economic electric cars have become the go-to option for both individual consumers and businesses seeking eco-friendly alternatives to traditional gasoline-powered vehicles.

Economic cars typically offer lower rental rates, which makes them highly attractive for short-term rentals, daily commuting, and business use, where cost efficiency is paramount. These vehicles are particularly popular in urban areas, where consumers prioritize fuel efficiency and environmental benefits. In addition, the rise of sustainable travel initiatives has further bolstered the demand for affordable electric options.

Exclusive Cars, while appealing to a more niche market, continue to capture a significant share of high-end rentals, often catering to luxury travelers or premium clients seeking top-tier features and enhanced driving experiences. Meanwhile, the Others category includes specialized vehicle types that serve specific applications, such as SUVs or vans, but represent a smaller portion of the overall market.

The overall trend indicates a preference for affordable, sustainable mobility, with economic electric cars remaining the primary choice in the electric car rental landscape.

Service Analysis

Online Segment Leads the Electric Car Rental Market in 2023

In 2023, the online segment held a dominant market position in the By Service Analysis category of the Electric Car Rental Market.

This shift towards digital platforms can be attributed to the growing preference for convenience, cost-effectiveness, and the increasing availability of user-friendly mobile applications. Online platforms offer customers the flexibility to book, manage, and track electric vehicle rentals through digital channels, enhancing user experience and operational efficiency.

The rise of online booking platforms is further driven by the increased adoption of e-commerce and smartphone penetration, facilitating seamless integration between customer needs and service availability. Additionally, online platforms often provide a broader range of electric vehicle options, enabling consumers to compare prices, features, and availability in real time.

On the other hand, the offline segment primarily caters to customers who prefer traditional methods of service acquisition, such as direct interactions at physical rental locations. However, the offline market is gradually declining as consumer behavior shifts toward more flexible, online-based service models that offer enhanced convenience and speed. Overall, the online segment’s continued growth is poised to drive innovation and further market expansion in the electric car rental industry.

Key Market Segments

By Vehicle Type

• Hybrid Cars
• Battery Cars
• Plug-in Electric Cars

By Application

• Economic Cars
• Exclusive Cars
• Others

By Service

• Online
• Offline

Drivers

Growing Demand for Eco-Friendly Transportation

The electric car rental market is experiencing significant growth, driven by the increasing demand for eco-friendly transportation options.

As consumers become more aware of the environmental impact of traditional vehicles, there has been a notable shift towards electric vehicles (EVs), which offer a cleaner and more sustainable alternative. This growing preference for environmentally responsible travel is reflected in the rising adoption of electric cars across various segments, including rentals.

Consumers are increasingly choosing electric vehicles not only to reduce their carbon footprint but also due to their lower environmental impact in terms of air pollution and greenhouse gas emissions. In response to this shift, rental companies are expanding their EV fleets to meet consumer demand, offering a variety of electric car models for short-term and long-term rental.

Additionally, as cities and regions around the world set stricter emissions regulations and climate goals, there is a growing push to promote the use of electric vehicles. This trend is further supported by government policies, such as subsidies and incentives for the adoption of electric cars, making EV rentals more affordable and accessible to a broader consumer base.

As a result, the electric car rental market is expected to continue to benefit from the rising demand for sustainable, cost-effective, and low-emission transportation solutions.

Restraints

Limited Availability and Charging Infrastructure Gaps in the Electric Car Rental Market

One of the primary constraints faced by the electric car rental market is the limited availability of suitable electric vehicle (EV) models for rent, particularly in certain regions. While EV adoption has been steadily growing, rental fleets may not always have enough diverse options for consumers, especially in areas where electric vehicles have yet to become mainstream. This creates a gap in consumer choice, limiting the appeal of electric cars for short-term rentals.

Furthermore, the development of charging infrastructure is still lagging behind in many parts of the world, particularly in rural or less developed areas.

The scarcity of accessible and reliable EV charging stations can lead to concerns about the convenience and feasibility of renting an electric vehicle, particularly for long-distance travel or for those unfamiliar with EV operations. Without widespread and reliable charging networks, potential customers may hesitate to rent electric vehicles due to fears of running out of battery or facing logistical challenges.

Consequently, both vehicle availability and insufficient charging infrastructure continue to act as significant barriers to the broader adoption of electric cars in the rental market. These factors need to be addressed to ensure a smoother transition towards sustainable mobility options for rental customers.

Growth Factors

Growth Opportunities in the Electric Car Rental Market

The electric car rental market presents several growth opportunities driven by emerging trends and industry demands. One significant opportunity lies in partnerships with charging networks.

Rental companies that collaborate with charging station providers can offer their customers seamless access to charging infrastructure, thus addressing one of the main concerns for electric vehicle (EV) renters—the availability of convenient charging locations.

Additionally, expansion into emerging markets holds considerable potential. As EV adoption continues to rise globally, developing regions, particularly in Asia-Pacific and Latin America, are expected to see a surge in demand for electric car rentals. This is further supported by government initiatives promoting green transportation and improving infrastructure. Finally, fleet electrification offers a key growth avenue.

Rental companies have the opportunity to transition their fleets to fully electric or hybrid vehicles, meeting the increasing consumer demand for environmentally friendly travel options.

Electrification not only aligns with global sustainability goals but also positions rental companies as leaders in the transition to a low-carbon future, which could enhance brand reputation and attract eco-conscious consumers. These opportunities, collectively, can significantly enhance the profitability and competitiveness of electric car rental businesses in a rapidly evolving market.

Emerging Trends

Key Trends Shaping the Electric Car Rental Market

The electric vehicle (EV) rental market is experiencing significant growth, driven by several emerging trends that align with environmental and urban mobility goals.

One notable trend is the integration of EV rental services with smart city infrastructure, which facilitates seamless and efficient urban mobility. This integration allows users to easily access rental vehicles through mobile apps or smart kiosks, improving the overall convenience and accessibility of EVs in cities.

Another factor contributing to the growth of the market is the introduction of carbon offset programs by EV rental companies. These initiatives appeal to environmentally-conscious consumers, offering a way to neutralize the carbon footprint of their trips. By participating in such programs, customers can contribute to sustainability efforts while enjoying the benefits of driving a zero-emissions vehicle.

Additionally, there is a growing demand for electric SUVs and crossovers in rental fleets. Consumers are increasingly seeking larger, more versatile EV options, such as SUVs, which combine eco-friendliness with practicality for long drives or group travel. This trend reflects the broader consumer preference for electric mobility solutions that meet diverse lifestyle needs.

Overall, these factors—smart city integration, carbon offset programs, and the rise of electric SUVs—are contributing to the evolving landscape of the electric car rental market, positioning it as a key player in the transition toward greener, more sustainable urban transport systems.

Regional Analysis

North America is the dominates the global electric car rental market

The Electric Car Rental Market is experiencing significant growth across various regions, driven by increasing environmental awareness, government incentives, and advancements in electric vehicle (EV) technology.

North America is the dominant region in the global electric car rental market, with largest market share. The region’s market growth is primarily attributed to strong government support for electric vehicles (EVs), a robust EV infrastructure, and a growing consumer preference for eco-friendly transportation solutions.

The U.S. is a key contributor to this dominance, with cities such as Los Angeles and New York leading the adoption of electric mobility. Major car rental companies like Hertz and Avis are also expanding their electric fleets, further fueling market expansion. The region’s steady growth is expected to continue as the EV adoption rate increases, and sustainability becomes more central to consumer choices.

Regional Mentions:

Europe holds a significant share of the electric car rental market, driven by stringent environmental regulations and growing demand for sustainable transportation. European countries like Norway, Germany, and the Netherlands are at the forefront of EV adoption, with widespread charging infrastructure and favorable government policies. This region is expected to see continued growth, particularly in urban areas where eco-friendly mobility solutions are increasingly popular among consumers and businesses alike.

The Asia Pacific region is rapidly growing in the electric car rental sector, with countries like China and Japan leading the charge. Government subsidies for EV purchases, growing charging infrastructure, and rising awareness of environmental issues are driving demand for electric rental vehicles. The region’s market is expected to expand as both private consumers and businesses look to shift toward greener alternatives.

In the Middle East and Africa, the electric car rental market is in its nascent stages but is projected to grow steadily. The UAE is a key player in this region, supported by government initiatives to promote sustainability and green energy solutions. While the market share remains smaller compared to North America and Europe, growing demand for eco-friendly transportation in urban centers is anticipated to drive future growth.

Latin America represents a smaller but growing segment of the electric car rental market. Countries like Brazil and Mexico are gradually increasing their focus on sustainable transportation solutions, supported by local government incentives. As charging infrastructure and consumer awareness expand, the region’s electric car rental market is expected to see gradual growth.

Key Regions and Countries covered іn thе rероrt

• North America
  • US
  • Canada
• Europe
  • Germany
  • France
  • The UK
  • Spain
  • Italy
  • Rest of Europe
• Asia Pacific
  • China
  • Japan
  • South Korea
  • India
  • Australia
  • Rest of APAC
• Latin America
  • Brazil
  • Mexico
  • Rest of Latin America
• Middle East & Africa
  • South Africa
  • Saudi Arabia
  • UAE
  • Rest of MEA

Key Players Analysis

In 2023, the global Electric Car Rental Market continues to experience strong growth, driven by increasing consumer demand for eco-friendly transportation solutions and the expansion of electric vehicle (EV) infrastructure. Several key players dominate this evolving market, with companies like The Hertz Corporation, Avis Budget Group, and Enterprise Holdings leveraging their extensive fleets and global reach to establish a competitive advantage.

The Hertz Corporation stands out with its aggressive EV expansion strategy, having committed to purchasing thousands of electric vehicles to meet rising customer demand. Hertz’s partnership with manufacturers like Tesla and Polestar reinforces its position as a leader in the sector, particularly in North America and Europe.

Similarly, Avis Budget Group has made significant strides in integrating electric vehicles into its global fleet, responding to shifting consumer preferences for sustainable travel options.

Zipcar and Europcar Group focus on the urban car-sharing segment, offering flexible and sustainable mobility solutions to consumers seeking convenience and affordability. These companies continue to expand their EV offerings, with Zipcar focusing heavily on electric models in key metropolitan areas, particularly in North America and Europe.

Regional players such as Green Motor International, Blueindy, and Wattacars target niche markets, capitalizing on localized demand for electric car rentals. These companies often cater to specific geographic regions, providing tailored EV solutions for urban residents and tourists.

The market is also characterized by Drive Electric and Zoomcar, which are focused on expanding the adoption of EVs in emerging markets such as India, where EV infrastructure and consumer awareness are rapidly developing.

Overall, the competitive landscape is shaped by a diverse mix of global and regional players, all of whom are positioning themselves to benefit from the growing trend towards electric mobility. The continued expansion of EV infrastructure, coupled with incentives from governments, is expected to further fuel growth in the global Electric Car Rental Market in the coming years.

Top Key Players in the Market

• The Hertz Corporation
• Green Motor International
• Blueindy
• Wattacars
• Zoomcar
• Avis Budget Group, Inc.
• Zipcar
• Europcar Group
• Enterprise Holdings Inc.
• Drive Electric

Recent Developments

• In March 2024, the Australian Renewable Energy Agency (ARENA) announced $4.76 million in funding under the Driving the Nation Program to support Europcar Mobility Group’s project for rolling out electric rental vehicles and the necessary charging infrastructure across the country, aiming to accelerate the transition to cleaner transport options.
• In January 2024, the Biden-Harris Administration unveiled $623 million in grants to further expand the national electric vehicle (EV) charging network, helping to increase access to EV charging stations and promote the adoption of electric cars across the United States.
• In September 2023, the U.S. Department of Energy (DOE) committed $15.5 billion to accelerate the transition to electric vehicles (EVs) and bolster domestic battery manufacturing, a key step in supporting clean energy goals and reducing dependence on fossil fuels.

Report Scope