May 09, 2019 / 16:59

Car rental market in Vietnam is growing

The Hanoitimes - Car rental has emerged to be one of the most prominent services in the country of fast urbanization and the increasing growth of middle-class population.

Vietnam’s car rental market has posted fast growth over the past years and would evolve in similar pace in the near future following the higher per capita income. 
Car for rent. Photo: Budapest
Car for rent. Photo: Budapest
Car rental, which is the hiring of a passenger vehicle for self-driving, including cars and small vans, by both business and leisure travelers for short term of duration, has become more popular in urban areas in the recent years.

Vietnam, with the increasing growth of middle-class population and fast
urbanization, car rental has emerged to be one of the most prominent services operating in the urban transport sector for local usage, airport transport, and outstation. 

The number of operational cars available for short term rental in Vietnam was 12,467 vehicles in 2017, showed statistics by Ken Research, a market research and consulting company based in India and the US. 

In the same year, the number of car rental transactions between a car rental company and consumers were 1.11 million. During the historic period, the number of operational cars grew at a compound annual growth rate (CAGR) of 5.39%, while the number of rental transactions grew at a CAGR of 4.09%.

The car rental (self-driving) market in Vietnam to 2022 would be diversified with different rental occasions, rental days, average rental length and other factors.

More specifically, the market would cover different kinds of rental, including daily, overnight, or for vacations or diverse options that are based on distance (kilometers). 

In Vietnam, car rental market has been on the upward trend and got more demand as the self-driving services help make full use of idle vehicles, connect car owners and clients with simple and flexible procedures. 

In addition, companies and apps connecting car owners and clients have simplified the procedures, therefore, boosting the services. 

Local media reported that the number of cars per 1,000 heads remains low, about 20. The figure is 10 times lower than that of Thailand and 40 times lower than that of the US. 

Gradually, more apps and service firms with updated technologies have helped car owners better manage their vehicles and clients have more options. 

The rental prices are different between weekdays and weekend, mostly on the occasions of holidays, especially Tet holiday or the Lunar New Year. In Tet holiday, the rental prices rise from 60% to double the common one, according to the Lao Dong.  

The prices vary around VND1 million (US$43)-VND1.5 million (US$65) per day depending on kinds of cars (normally 5- and 7-seater vehicles).