Car rental and car leasing in 2023

Fresh information and data collected by car rental company Avis over the past year shows that there is an increasing trend towards last-minute bookings for short-term cars. There is also an increasing willingness to plan longer, multi-day trips. The good news is that the number of tourists from the United States and the Scandinavian region is increasing.

Trends in the full-service leasing industry show a noticeable decline in demand for diesel-powered cars. In general, companies are increasingly focusing on more environmentally friendly alternatives for commuting. Read on to find out more about car trends!

Short-term car rental – demand on the rise

Demand for short-term car rentals increased by 10% last year. Significantly, the number of days for which cars are rented is also increasing, as travellers plan longer leisure trips. A characteristic trend is that customers are increasingly travelling to all the Baltic States – Latvia, Lithuania and Estonia – in succession. However, bookings are still being made very shortly before the planned trip, about a week in advance.

“Daina Kantāne, Head of Leasing at Avis, says that the number of travellers coming to the Baltics from the USA and Scandinavia has particularly increased. While some tourists were previously cautious when planning a trip to the Baltics, new information and data show that they now feel much more confident and willing to choose the region as a destination.

What are the most popular cars for short-term rental? SUVs or city crossovers are still the top choice, but individuals also tend to choose economical, small cars to reduce fuel costs. Business class customers are most likely to choose a mid-range car, and certainly one with an automatic gearbox. These are usually compact hatchbacks or SUVs. The data shows that there is less demand for electric cars in short-term car rental. This is due to customers’ concerns about the time needed for charging and the availability of charging points. To develop this sector, more information on the possibilities is needed.

Encouraged by tax policy, companies are building greener fleets

One of the trends in full-service is that demand for diesel cars fell in 2023. The choice of cars was influenced by changes in tax policy – cars with more power pay more passenger car tax. As the European Union encourages greening our environment and minimising CO2 emissions, it is expected that companies will increasingly think about how to make their fleets less harmful to the environment. Demand for electric and hybrid cars is likely to increase in the coming years. In 2022, they accounted for 13% of new cars, and in 2023 for 22%. This trend is likely to continue this year.

Daina Kantāne admits that the last two years have been quite difficult: the economy has been affected by the effects of the pandemic and the fight against it, the war in Ukraine, the rise in Euribor interest rates and the energy crisis. These rapid changes mean that individuals and companies alike are cautious in their decision-making and generally rather wait-and-see, including with regard to changes in the car fleet. However, decisions cannot be postponed indefinitely, so Avis predicts that this year both business representatives and individuals will be more proactive in making changes and decisions.

“Avis – car rental and full-service leasing company

Avis, a company providing long- and short-term car rental and full-service car leasing services. The company has been operating in Latvia for more than 30 years and has become one of the largest players in the car rental market. Contact us to find out how we can help!