Car Rental Challenges for 2021

This year is coming to a close and the pandemic is still here, so what does this mean for car rental businesses?

The car rental industry has been impacted negatively by this pandemic. Due to lockdowns and curfews throughout the world, travel is at a minimum. In the US it was estimated that airport arrivals have gone down by 94%, meaning almost no rentals were booked from airports – car rental businesses make two-thirds of their revenue via airport reservations. Some countries have closed their airports preventing any travel in and out of the country.

Heading into a new year with the pandemic still going strong means businesses will have to face a lot of uncertainties, but things will eventually go back to normal. Here’s a look at what challenges are to be expected for the year 2021.

• Reservations will mostly remain online

Even if travel restrictions are lifted people will still opt for online reservations and prefer making a pick-up involving less human contact. Even if the vaccine is released early and the pandemic does pass, people will be used to contactless services that also extend to car rentals.

If you want your business to keep running, try to implement new strategies that will help boost your image and make your customers feel safe during this uncertain time. Opt for dropping the vehicle off instead of having the customer come to your lot for the pick-up. If that’s impossible continue with contactless pick-ups and transactions.

Use fleet management software and opt for mobile apps and websites to remain relevant and garner more business. This can greatly help start-ups to get a boost, instead of depending on traditional forms of marketing. Navotar offers all the digital solutions needed for a car rental business, from website development to fleet management software. Visit our website for more information.

• Upgrading the fleet

This may be an issue as the car manufacturing industry has taken a hit, and adding brand new vehicles to your fleet may be a financial risk. However, many car sales businesses have rebounded and the industry is improving, but the numbers are not as good as it was in 2019.

But due to the low demand for brand new vehicles by the public, many people may opt for a rental at least until they can purchase a brand new vehicle. This is a great opportunity for car rental businesses to be more open-minded and market their business towards them.

However, big names like Hertz have been knocked down hard by the COVID-19 pandemic. Hertz opted to remove the extra fee for young drivers between the ages of 21-24 and also sold many cars in their fleet. Implementing business preserving solutions like this will ensure your business survives the harsh times to persevere in the future.

• Continuation of strict disinfection protocols

If the pandemic does come to an end by next year, customers may still be skeptical about using rentals. Therefore, it is imperative that car rental companies continue strict disinfection protocols well into next year.

This is a tough time for everyone, and the situation surrounding the COVID-19 pandemic has many uncertainties. Making sure that the rentals are clean and safe ensures a healthy and empathetic relationship with your customers. Also, maintaining a clean, infection-free environment also ensures the safety of your staff.

Since public transport is risky due to the risk of spread within closed spaces, renting a car is always a better option. It is the duty of car rental business owners to make sure their customers are comfortable and safe.

• Unpredictable circumstances

A pandemic is mostly unpredictable, and how long it lasts depends on people – from the rate of spread to inventing a vaccine. As a business owner unpredictability may seem bad, but being prepared for anything is key.

With the current situation, the travel industry as a whole is struggling, and it may take a while till things turn around. However, the rental business has a glimmer of hope to rebound faster with the demand for rentals increasing.

Hopefully this time, next year, things will be back to normal. Till then, start implementing smart marketing strategies and business preserving solutions so your car rental businesses may survive these hard times.