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From Car Ownership To Car Sharing: Car Rental Companies Changing The Face Of Mobility
Driven by urbanization, the demand for mobility in India is growing at a rapid pace. With this demand swiftly rising, the auto industry is becoming increasingly conscious of the challenges associated with this faced-paced growth.
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The global automobile industry is undergoing a significant transformation. Driven by urbanization, the demand for mobility in India is growing at a rapid pace. With this demand swiftly rising, the auto industry is becoming increasingly conscious of the challenges associated with this faced-paced growth.
In response to challenges such as increasingly congested roads, highly-polluted air due to our dependence on fossil fuels, we are also seeing a rapid shift in consumer usage patterns. Consumers are focusing more on experience rather than ownership.
With the car rental market that is expected to reach $214.04 billion by 2027, mobility providers have speed and sustainability at the front of their minds when it comes to developing a new range of mobility propositions such as self-drive car rentals, carpooling, car subscription, and short-term leasing.
Growing popularity for shared mobility
In India, these are the beginnings of a huge mobility transformation, with a new breed of rental solutions gaining traction in the country, primarily because the car rental companies have been quick to accommodate the changing needs of the consumers. The car rental companies have realized the need to sustainably grow the mobility ecosystem, both from an economic and environmental perspective.
Why is there a shift?
Car ownership in India is still considered a status symbol. But buying a brand new car can be a big-spending commitment for many. Furthermore, the COVID-19 pandemic has resulted in economic uncertainty, consequently, leading some consumers to act cautiously when it comes to committing to purchasing a new vehicle. Thus, renting a car is seen as a safe and flexible alternative.
According to Deloitte’s 2019 Global Automotive Consumer Study, more than half of India’s millennials questioned the need for purchasing and owning a car. Evidently, the status attached to car ownership has gradually eroded among these groups, and the concept of shared mobility is increasingly being adopted in the country. Car sharing implies that such groups can gain the benefits of private cars whilst avoiding the cost and hassle of vehicle maintenance –the core responsibilities of car ownership.
Shared mobility services are also convenient for those in transferable jobs, which eliminates the need to transport their car from one place to another as they move. Thus, sharing a car (instead of owning it) makes much more sense for many drivers to pay for their mobility as and when they need it.
Also, car rental services are leveraging the potential of new-age technology such as artificial intelligence, machine learning, and data analytics to offer the best user experience and ensure the safety of customers. From thorough sanitization and keyless entry systems, these technologies have streamlined the process of renting a car.
We are seeing winds of change blowing through India’s automobile industry, especially in the car rental sector. Based on the aforementioned facts and figures, there is no disagreement that the shared mobility sector is fast-growing in India. The shared mobility operations have started to expand in size and scope, and this will further accelerate with the electrification of vehicles.
The emergence of car rental solutions has resulted in a change in consumer behavior to get from A to B. Thus, car rental companies are well on their way to disrupt the existing norms and their future certainly appears promising.
Disclaimer: The views expressed in the article above are those of the authors' and do not necessarily represent or reflect the views of this publishing house. Unless otherwise noted, the author is writing in his/her personal capacity. They are not intended and should not be thought to represent official ideas, attitudes, or policies of any agency or institution.