June 22, 2024
Mexico Car Rental Market

The Mexico Car Rental Market Is Expected To Driven By A Growing Tourism Sector

The Mexico car rental market features a wide variety of rental vehicle classes such as economy or budget cars, compact and intermediate cars, standard cars, full-size cars, premium cars, luxury cars, sports utility vehicles (SUVs), multi utility vehicles (MUVs), and trucks. Car rental services provide transportation flexibility and convenience to both leisure and business travelers. The demand for car rental services in Mexico is increasing owing to rising tourism activities in the country. Mexico welcomed over 41 million international tourist arrivals in 2019 according to the World Tourism Organization.

The global Mexico Car Rental Market is estimated to be valued at US$ 1220.02 Mn in 2023 and is expected to exhibit a CAGR of 10% over the forecast period 2023 to 2030, as highlighted in a new report published by Coherent Market Insights.

Market key trends:

One of the key trends in the Mexico car rental market is the increasing preference for online car rental bookings. The ease and convenience of reserving a rental vehicle from anywhere through mobile apps and websites is driving the growth of online bookings. Major car rental companies have developed robust digital platforms to provide end-to-end rental services online from vehicle selection and reservations to add-ons, insurance offerings, and payment processing. This is improving booking experiences for customers and allowing rental companies to optimize fleet utilization.

Porter’s Analysis

Threat of new entrants: New entrants will find it moderately challenging to enter the Mexico car rental market due to the existing presence of well-established players and the requirement of sizable investments.

Bargaining power of buyers: The bargaining power of buyers is moderate. Buyers have several options to choose from in terms of vendors, vehicle types, and pricing.

Bargaining power of suppliers: A few major players dominate the vehicle supply market, enabling them to exercise some control over pricing. However, the threat is moderate due to flexibility of operations.

Threat of new substitutes: Alternate modes of transportation such as taxis, ride-hailing and public transportation pose potential threats.

Competitive rivalry: Intense competition exists among existing vendors to enhance market share through competitive pricing and service differentiation.

Key Takeaways

The global Mexico Car Rental Market Growth is expected to witness high growth. Mexico is witnessing strong growth in tourism owing to expanding international airport networks and government initiatives to boost the industry. The influx of foreign travelers contributes significantly to the car rental business. The global Mexico Car Rental Market is estimated to be valued at US$ 1220.02 Mn in 2023 and is expected to exhibit a CAGR of 10% over the forecast period 2023 to 2030.

Regional analysis:

The north central region holds the major share in the Mexico car rental market and is poised to maintain its dominance through 2030. Cities like Mexico City and Monterrey generate maximum demand. The Pacific region in the west is growing at the fastest pace led by tourism hotspots like Cancun, Los Cabos, and Puerto Vallarta.

Key players:

Key players operating in the Mexico car rental market are National Car Rental, EUROPCAR GROUP S.A, MEX Rent a Car, Budget Rent A Car System Inc., Fox Rent A Car, Thrifty Car Rentals Inc., THE HERTZ CORPORATION, Sixt SE, Avis Budget Group Inc., and Alamo. Players are expanding fleet sizes and service networks to capture a larger share. Upgradation of IT systems and mobile apps is another area of focus.

1. Source: Coherent Market Insights, Public sources, Desk research
2. We have leveraged AI tools to mine information and compile it