Robust growth in promotional offers coupled with increase in acquisitions and mergers has amplified the size of the Vietnam Car Rental Industry.
The car rental market in Vietnam has experienced various mergers and acquisitions over the years. Moreover, international players have expanded by entering in Vietnam car rental market. Enterprise Holding Inc. has announced its plans to enter Vietnam market with its flagship brand Enterprise Rent-A-Car as well as its National Car Rental and Alamo Rent-A-Car in partnership with MP Logistics. There is a transformation of Vietnam car rental market from unorganized market to the organized market. The demand from car pooling services has been rising over the years in Vietnam. The traffic congestion in the country has led to the popularity of these services, making a positive impact on the car rental services industry in the country. Until recently, carpooling services of cab aggregators were banned.
Vietnam car rental companies have been introducing discounts and promotion in order to retain the old consumer base in the country. The increasing competition and number of players in the market has led to a competitive scenario which has led the companies to introduce competitive pricing and to have an edge over competitors. The firms such as GrabCar have been giving discounts to the customers which have encouraged new customers to try their services. Various companies use promotions and discounts to have a competitive edge over other players. For instance, Avis Rent a Car had a summer promotion program with the service package for Self-drive car rental while Vietnamcarrentaldeals.com offered discount on the online booking.
The cab aggregator companies such as Uber and Grab run on the mobile app business model and the popularity of these apps has been rising with elevated internet penetration and increase in number of smart phone users. Various car rental players such as Vinasun, Hertz, Avis and others are also shifting to mobile apps to increase the convenience for customers and to increase the consumer base.
The report titled “Vietnam Car Rental Market Outlook to 2021 – Rising Tourism and Trend of Mobile Booking for Rental Cars to Drive Market” by Ken Research suggests a robust CAGR of 12.0% in revenue terms and 14.1% in terms of fleet size for the Car Rental market in Vietnam in the next 5 years till 2021.
Ankur Gupta, Head Marketing & Communications