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Holiday Car Hire - UK - May 2015

The holiday hire car market is forecast to grow steadily, supported by a strong holiday market, a resilient Pound against the euro and low petrol prices. There are a number of opportunities for car hire companies to engage with younger consumers particularly for shorter hire terms and alternative fuel cars. However, prices and fees remain a key factor for the vast majority of consumers.

This report looks at the following areas:

  • Hidden costs continue to be an industry hot topic
  • Short-term city lending will grow in popularity
  • Peer-to-peer car lending
The rising holiday market will mean growth for car hiring
 
The economy is improving and consumer confidence is rising, which is leading to a growth in holidays overall. Both package and independent holidays are growing in volume, however, package holidays are growing faster and the majority of people hiring cars do so on independent holidays, which means that the forecast growth for holiday car hires is expected to be fairly gradual.

The vast majority of consumers will book their holiday car hire before they travel with 90% of consumers using pre-booking options. Of those pre-booking nearly one in seven book their car hire online – an increase of 6 percentage points compared to the previous year.

For the purposes of this report, holiday car hire is restricted to overseas use only. It excludes any business use, any non-holiday leisure use and any use in the domestic market. Bookings may be made in the UK, but the primary use for a vehicle must be for a holiday abroad. An adult, for the purposes of Mintel’s research, is anyone aged 16 or over.


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Table of contents

  1. Overview

    • What you need to know
      • Products covered in this report
      • Executive Summary

        • The rising holiday market will mean growth for car hiring
          • Figure 1: Volume forecast of holiday car hire abroad, 2019-19
          • Figure 2: Annual average exchange rates for Sterling vs. euro and US$, 2010-15
          • Figure 3: Unleaded petrol cost per litre, UK, January 2012-December 2014
        • Three car hire brands dominate the market
          • Figure 4: Top four holiday car hire companies used abroad in the past three years, December 2014
        • Just over a third of holidaymakers will book a hire car on holiday
          • Figure 5: Holiday car hire usage within the last three years, by age, December 2014
          • Figure 6: Top two preferences when hiring a car on holiday abroad, December 2014
      • Issues and Insights

        • Hidden costs continue to be an industry hot topic
          • The facts
            • The implications
              • Short-term city lending will grow in popularity
                • The facts
                  • The implications
                    • Peer-to-peer car lending
                      • The facts
                        • The implications
                        • The Market – What You Need to Know

                          • Car hires volumes are expected to rise
                            • The faster growth of package holidays may limit car hire growth in the long term
                              • Low petrol prices are helping the market
                                • Portugal is the most expensive destination to hire a car
                                • Market Size and Forecast

                                  • Gradual growth forecast to 2019
                                    • Figure 7: Volume of holiday car hires abroad by UK residents, 2009-19
                                  • Desire to experience more highlights growth opportunities
                                    • Figure 8: Volume forecast of holiday car hire abroad, 2009-19
                                  • Car hire companies will struggle to get customers to pay more
                                    • Figure 9: Overseas holiday volume, value and average expenditure, 2009-14
                                  • More exotic and far-flung destinations are looking attractive
                                    • Figure 10: Overseas holiday volume, by mode of transport, 2009-14
                                  • Car ownership rates remain steady
                                    • Figure 11: Car ownership in Great Britain, 2009-13
                                • Market Drivers

                                  • Package holidays are growing faster than independent holidays
                                    • Figure 12: Volume of overseas package and independent holidays, 2009-14
                                  • Favourable exchange rates support the holiday market
                                    • Figure 13: Annual average exchange rates for Sterling, 2010-15
                                  • Petrol prices dropped in the UK and abroad during 2014
                                    • Figure 14: Petrol and diesel cost per litre, January 2012-December 2014
                                    • Figure 15: Unleaded petrol cost per litre, January 2012-December 2014
                                    • Figure 16: Petrol price, by European country, 2011-14
                                  • European short break holidays prove popular
                                    • Figure 17: Top 20 overseas holiday destinations, 2009-14
                                    • Figure 18: Top 10 independent holiday destinations, by number of visits, 2009-14
                                    • Figure 19: Average car rental costs in top 13 ONS holiday destinations, July 2014
                                • Channels to Market

                                  • Nearly one in seven book online
                                    • Figure 20: How last holiday car hire was booked, December 2014
                                  • Almost a third use online brokers
                                    • Figure 21: How last online holiday car hire booking was made, December 2014
                                • Key Players – What You Need to Know

                                  • The top three brands dominate the market
                                    • Most companies offer basic loyalty schemes and booking apps but few are innovative
                                      • There is a market potential in hybrid and electric hire cars
                                      • Market Share

                                        • Three market players dominate the car hire market
                                            • Figure 22: Holiday car hire companies used abroad in the past three years, December 2014
                                          • Loyalty schemes offer free weekends and faster check-ins
                                            • Figure 23: Holiday car hire company loyalty schemes and rewards, April 2015
                                          • Most companies have a smartphone booking app
                                            • Figure 24: Holiday car hire company iOS apps, April 2015
                                        • Launch Activity and Innovation

                                          • The main car hire companies are expanding rapidly
                                            • Hybrid cars are being introduced in city centres
                                              • Figure 25: Attitudes towards holiday car hire, by age, December 2014
                                              • Figure 26: Features sought from a new car, December 2014
                                            • Two brands invest in city car sharing schemes
                                              • easyCar launches a peer-to-peer car lending service
                                              • The Consumer – What You Need to Know

                                                • Younger consumers are the most likely to hire a car for short periods of time
                                                  • Convenience is a key factor in the hiring process
                                                    • The low cost and car culture of the US pushes it to the top of the list of hire destinations
                                                    • Hire Car Usage

                                                      • Car hire companies are not reaching new customers
                                                        • Figure 27: Holiday car hire usage within the last three years, December 2014
                                                        • Figure 28: Holiday car hire usage within the last three years, by age, December 2014
                                                      • Younger consumers are the most likely to book a hire car during a short break
                                                        • Figure 29: Length of holiday booked by those who have hired a car in the last three years, December 2014
                                                      • Nearly one in six independent holidaymakers will book a hire car
                                                        • Figure 30: Type of holiday booked by those who have hired a car in the last three years, December 2014
                                                    • Motivations for Booking a Hire Car

                                                      • Consumers hire cars abroad to allow them to explore
                                                        • Figure 31: Motivations behind booking a hire car, December 2014
                                                      • Convenience factors are key reasons behind hiring a car
                                                        • Figure 32: Motivations behind booking a hire car, December 2014
                                                      • The US is where consumers are most likely to hire a car
                                                        • Figure 33: Hire car use, by country visited, December 2014
                                                    • Hire Car Preferences

                                                      • Car hire customers want to have a hassle-free pick-up
                                                        • Figure 34: Preferences when booking a hire car, December 2014
                                                        • Figure 35: Preference for booking a hire car for a shorter period of time, by age, December 2014
                                                    • Appendix – Data Sources, Abbreviations and Supporting Information

                                                      • Data sources
                                                        • Abbreviations
                                                          • Definitions
                                                            • Fan chart forecast

                                                            Companies Covered

                                                            To learn more about the companies covered in this report please contact us.

                                                            Holiday Car Hire - UK - May 2015

                                                            US $2,672.70 (Excl.Tax)