Ending Soon! Save 33% on All Access

How Car Rental Companies are Changing the Face of Shared Mobility in India Driven by the need to offer sustainable transport that is both cost and energy efficient, car rental services have ensured that they harness the potential of new-age technology

By Sunil Gupta

Opinions expressed by Entrepreneur contributors are their own.

You're reading Entrepreneur India, an international franchise of Entrepreneur Media.


According to Deloitte's 2019 Global Automotive Consumer Study, more than half of India's millennials questioned the need for purchasing and owning a car. The report stated that the concept of shared mobility was increasingly being adopted in the country where half the population is less than 25 years of age. In 2019, the automobile sales in India hit a two-decade low, with passenger car sales falling below 3 million units.

Rising GST, liquidity crunch, and other challenges such as increasing prices on new engines as per the Bharat Stage Six (BS-VI) emission norms were some of the factors contributing to this fall in overall sales. These elements also paved the way for the rise of shared mobility services which are affordable, cleaner and more efficient. Major contributors to this are car rental companies which, through innovative technology and excellent user experience, have made it easy for people to commute rather than drive. Let us take a look at how car rental companies are transforming the shared mobility industry in India, and why a large percentage of the country is turning to them for mobility.

Adapting to the consumer's needs

The global car rental market is expected to reach $164,335 million by 2022, and this is largely due to car rental companies rapidly adapting and improvising to accommodate the needs of the consumers. Driven by the need to offer sustainable transport that is both cost and energy efficient, car rental services have ensured that they harness the potential of new-age technology such as artificial intelligence, machine learning and data analytics to offer the best user experience to consumers as per their preferences. Clubbed together, these technologies have streamlined the process of renting a car.

From choosing your car to the fuel type to payment modes, the entire process is taken care of by technology, enabling the consumer to have a hassle-free experience. Tech-enabled systems such as GPS, security and telematics systems that offer better navigation and safety have made the concept of shared mobility more attractive to the new-age consumer.

Also Read: Electrifying the future: Electric Vehicles can ensure Long-Term Sustainability

Sustainable and affordable

A Morgan Stanley report predicts that by 2030, India will witness a large-scale expansion of shared mobility services, and is also expected to be one of the leading countries in shared mobility. Owing to the population, especially in metro cities, and the shrinking availability of space, climate change, and the rising prices of fuel and taxes, people are more likely to be drawn to sustainability. Car rentals are more sustainable in terms of being more environmentally friendly than owned vehicles. With the advent of electric vehicles (EVs), the industry is leaning towards being even more eco-friendly.

Car rental services are also easily available and offer multiple options which are affordable and can be chosen to suit the customer's needs. Another crucial aspect that users need not worry about is the cost and hassle of vehicle maintenance. This is an advantage that rental cars have over personally owned cars since the responsibility for maintenance and repair of the vehicle is minimal. While car rental companies do have regulations for the consumer to pay for any damage to the vehicle, they eliminate the regular maintenance charges which would have to be paid in case of ownership of a personal car. One is also free from worries about the depreciating value of an asset when one rents a car instead of owning one. These multiple benefits have ensured that car rental companies gain a massive user base within a short period of time, and increased adoption of shared mobility in the country.

Also Read: Luxury Rental Cars: The New Stars of Indian Weddings

The future perspective

While the shared mobility industry has evolved by leaps and bounds in recent times, there is more potential that the industry offers which is yet to be unlocked. The EV industry is still at a nascent stage in India. However, it is set to grow massively, with both the government and private sector working towards the development of EVs. Based on the facts and figures, it is evident that the shared mobility sector has gained a strong foundation in the country and is only growing further. To get a better idea, however, we would only have to wait and see what the future has in store.

Sunil Gupta

MD & CEO, Avis India

Avis India is a joint venture between Avis Budget Group and Oberoi Group of Hotels and is the leading car rental and leasing company in India. It is the only vehicle mobility Company in India which offers end-to-end mobility solutions - chauffeur-drive vehicles for short term rentals and long term rentals and vehicles for operating lease and self-drive in India. Since he joined the Company 8 years back, the Company’s revenue has grown over four times, IT solutions have transformed the Company and Avis has become one of the Top 3 operating lease companies in India in the 5 years since the business was launched.

He has an experience of over 25 years in leading MNCs in India across FMCG and business & financial services like Hindustan Unilever, Thomas Cook and Kuoni. His skills in the areas of sales, brand building, new business development and business re-structuring have helped in the creation and execution of strategies that have delivered high growth and profitability in diverse businesses. For the past couple of years, his passion has been the development and deployment of unique IT solutions for customer management and automation of business processes.     

News and Trends

CoverSure and CirclePe Raise Early-Stage Funding

Here are the Indian startups that announced early-stage funding rounds.


Is Consumer Services a Good Career Path for 2024? Here's the Verdict

Consumer services is a broad field with a variety of benefits and drawbacks. Here's what you should consider before choosing it as a career path.

Business Models

How to Become an AI-Centric Business (and Why It's Crucial for Long-Term Success)

Learn the essential steps to integrate AI at the core of your operations and stay competitive in an ever-evolving landscape.