| A12371 | Pages: 240 | Jul 2021 | 3069 Views | ||
| Author(s) : Omkar Bachal , Sonia Mutreja | Tables: 119 | Charts: 74 |
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Pandemic disrupted the entire world and affected many industries.
Get detailed COVID-19 impact analysis on the Car-as-a-service Market
Request Now !The global car-as-a-service market was valued at $122.22 billion in 2020, and is projected to reach $225.65 billion by 2030, registering a CAGR of 6.8%. Europe was the highest revenue contributor, accounting for $44.61 billion in 2020, and is estimated to reach $88.91 billion by 2030, with a CAGR of 7.6%.
The spread of the COVID-19 pandemic has negatively impacted the car as a service market, owing to travel & commute restrictions that have resulted in weak performance of the market players in 2020. Factors such as the decrease in the income of consumers, the concern of coronavirus transmission in public transport, and the high cost associated with car buying is expected to support the market to recover at a considerable rate in the near future.
Car-as-a-service refers to a new era of the automotive industry that has changed perspective toward car ownership sentiments. Car-as-a-service deals with end user-focused modes of transport mainly deal with car leasing, car rental, and car subscription services. Car-as-a-service is a fixed durational contract between service providers and vehicle end-users along with pre-defined benefits for the end-users. From the perspective of service providers, fleet management is a crucial factor to maintain attractive vehicle offerings for the end-user and gain a competitive advantage. The trend of changing passenger vehicles within 3 to 5 years is growing exponentially, due to changing consumer sentiments in which most end-users are millennial, high-end technology up-gradation, growing need for cost effective urban mobility solution.
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Factors, such as flexibility and convenience of car-as-a-service, car-as-a-service model is cost-efficient compared to buying the car ownership in shorter duration are expected to drive the growth of the car-as-a-service market. However, mileage restrictions of car-as-a-service drawback for the long term transportation need, and obsolescence of the aged fleet restrain the market growth. On the contrary, development of a strong digital platform to operate the services effectively, expansion of dealer network for better reach or effective provide services are projected to offer lucrative growth opportunities for the market players.
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The car-as-a-service market is segmented into propulsion type, end use, and vehicle type. By propulsion type, it is further divided into IC powered vehicle, and electric vehicle. By end use, the car-as-a-service market is segmented into private, and corporate. By vehicle type, the market is segmented into multi utility vehicle (MUV), sports utility vehicle (SUV), economical car, executive car, luxury car. Region-wise, the market is analyzed across North America, Europe, Asia-Pacific, and LAMEA.
Leading players and their key business strategies have been analyzed in the report to gain a competitive insight into the market. Key players covered in the car-as-a-service market report include BMW Group, Daimler AG, Facedrive Inc., Fair Financial Corp., Ford Motor Company, Lyft Inc, Primemover Mobility Technologies Pvt Ltd., The Hertz Corporation, Toyota Motor Corporation, and Volvo Car Corporation.
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Car as a service refers to the limited periodic contractual mode of car ownership along with several benefits for end consumers such as maintenance and insurance cost. Car-as-a-service is comprised of car rental, car leasing, and car subscription services which allows the limited period usage of the vehicle. As per the car-as-a-service business model, it provides flexibility to the end consumer for opting for the vehicles models as per the choice for the specified duration and stated kilometer as per the contract. Moreover, the car subscription business model enables the multiple switches of the car within the specified time duration. Therefore, the flexibility of car-as-a-service attracts the millennial generation that also provides cost-effective car as a service solution in the short run which is anticipated to bolster the demand for car-as-a-service in the upcoming years.
Car-as-a-services are equipped with several benefits over car purchase such as multiple car switches within a limited time frame and cost-effectiveness over short-term mobility requirements. Car-as-a-service provides car ownership for a limited timeframe along with operational cost-effectiveness as compared to buying the new car. Car-as-a-services eliminates the cost of maintenance and acquisition of the new vehicles including the down payment while purchasing, interest value on vehicle debt, periodic maintenance expenses, insurance cost among others. Moreover, market participants are focusing on this business model in recent years targeting working professionals, salaried individuals, small and medium enterprises, public and corporate sector consumers. The dominance of the millennial generation is high at these end consumer categories and they are more focused on changing the car every 3 to 5 years. Car as a service deals with monthly payment cycles is inexpensive than owning a vehicle for a duration lesser than 2 years. Changing mobility outlook and cost-effectiveness is expected to spur the demand for the car-as-a-service market over the forecast period.
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Car-as-a-service market participants are mainly dealing with the domestic market as it involves direct consumer dealing business, which needs to fulfill the convenient requirement for flexible operations.
Moreover, market participants need a dedicated workforce for a particular region to operate seamless business activities including the fleet management, while the dedicated workforce incurs high cost to the company. For effective business activities and cost-effective operations, market participants are developing the dealer network to fulfill the consumer requirement efficiently with effective cost management. For instance, market participants, such as Fair, Lexus Complete Lease, and Flexdrive, have well-established dealer network and are continuously involved in the development of dealer network. To acquire the wide spread of the business footprints, market participant need to focus on dealer network.
The spread of the COVID-19 pandemic has negatively impacted the car as a service market, owing to travel & commute restrictions that have resulted in week performance of the market players in 2020. The economic impact of the pandemic is visible with a high number of car booking cancellations by consumers in the market. For instance, according to auto rental news, increased border closures and cancellations also had a significant impact on the capitalization of the leading car as a service market participants such as Europcar, Hertz, and Avis by 63%, 83%, and 74% loss of share value respectively. In nine countries, it has been observed that more than 30% of car bookings were canceled. Market participants of car-as-a-service are following certain approaches to manage the operations by slashed budgets, extended equipment lifecycles, decreased staff sizes, and reduced salaries in the short term to overcome financial downturn.
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Key Benefits For Stakeholders
Key Market Segments
By Propulsion Type
By End Use
By Vehicle Type
By Region
Key Players
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The global car-as-a-service market is expected to witness significant growth, owing to rise in demand for cost-effective and flexible mobility solution. Car-as-a-service is being popular amongst the millennial population as this model provides the choice of switch the vehicle within a short duration along with the several add on benefits. Europe is a leader in the global car-as-a-service market, owing to the changing automotive industry outlook in the region and consumer confidence toward new generation mobility solutions. The global car-as-a-service market is a fairly fragmented market in which several market participants are operating in the global market.
Market participants are focused on expanding their sales footprints in the domestic market through dealer networks, enter into contracts with end users, and introduce new product offerings of car-as-a-service solutions to cope up with changing requirement of the end users. Numerous developments have been carried out by top companies, such as Toyota Motor Corporation, The Hertz Corporation, Facedrive Inc. and others, which have supplemented the growth of the global car-as-a-service market. COVID-19 significantly affected the global car-as-a-service market in 2020. Furthermore, the market witnessed negative growth or significant downfall in 2020 and it is expected to witness recovery in the first half of 2021.
A. Car-as-a-service is a fixed durational contract between service providers and vehicle end-users along with pre-defined benefits for the end-users.
A. The global car-as-a-service market was valued at $122.22 billion in 2020, and is projected to reach $225.65 billion by 2030, registering a CAGR of 6.8%.
A. The report sample for global car-as-a-service market report can be obtained on demand from the website.
A. The increased demand for electric driven car-as-a-service solution to support the low carbon footprint initiatives by the policymakers
A. chnaging consumer sentiments towards car ownership and low consumer confidence due to COVID-19 helath crisis is expected to impact the market growth amid the lifting lockdown measures
A. The company profiles of the top players of the market can be obtained from the company profile section mentioned in the report. This section includes analysis of top ten player’s operating in the industry along with their last three-year revenue, segmental revenue, product offerings, key strategies adopted, and geographical revenue generated
A. The U.S. and Germany are key matured markets growing in the global car-as-a-service market
A. By Propulsion type, the Electric Vehicle segment is expected to gain traction over the forecast period
A. Based on the car-as-a-service market analysis,Europe region accounted for the highest revenue contribution in 2020 and is expected to see lucrative business opportunities during the forecast period
A. Expansion, product development, and acquistion are the top most competitive developments which are adopted by the leading market players in the global car-as-a-service market
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