III. Industry Analysis
The Car Rental industry has increased slightly over the past five years. Rising per capita disposable income, coupled with a national unemployment rate below 5.0%, have encouraged consumers to increase their level of spending on car rentals for leisure trips.
It is anticipated that the industry will continue to grow over the next five years. Industry demand is anticipated to rise alongside a rebound in domestic travel, supported by a recovery in the US economy. Growth in demand for car rental services is expected to be augmented by rising per capita disposable income and improved in corporate profit levels. Additionally, anticipated growth in the number of inbound trips to the United States by foreign visitors over the next five years will likely boost industry demand at airports.
As US airports experience more traffic, demand for car rental services is also forecast to rise to the benefit of industry operators. The industry’s largest companies are expected to retain their competitive advantage over smaller players by maintaining strategic alliances with airlines and hotels. Such partnerships will likely provide rental car companies with a steady stream of referral business, with coordinated rewards programs adding loyalty incentives for consumers.