Brazil migrating from car ownership to pay for use - ABLA
In Brazil, the idea of car ownership is transitioning more toward a culture of paying for the use of cars, according to Paulo Miguel Junior who is the president of the country’s car rental association ABLA.
In 2019, a total of 49.6 million rent-a-car daily rates were achieved in the country, up 15.3% from the 43 million reported in 2018. Moreover, the rental segment broke a vehicle licensing record last year by purchasing 22.8% of all the cars and light commercial vehicles (LCV) sold in the country.
“In absolute numbers, the sector was responsible for registering 541,346 cars and LCVs in 2019, up 31.2% from the 412,754 reported in 2018, making rental agencies the main customer for automakers,” Mr. Miguel told Fleet LatAm.
“Brazilians are increasingly thinking twice before purchasing a new vehicle nowadays,” said the executive.
ABLA president Paulo Miguel and Fleet LatAm editor Daniel Bland (source: Fleet LatAm)
Much of the growth in demand is coming from transportation network companies (TNC) such as ride-hailing firms Uber, Easy Taxi and others. According to ABLA, between 150,000-200,000 vehicles are rented out to these drivers, equivalent to nearly 18% of the total vehicle rental market.
In terms of total rent-a-car fleet in Brazil, 171,085 units were added last year, bringing the national rent-a-car parc to 997,416 units. By year-end 2019, a total of 10,812 rental car agencies were in Brazil, up 34.6% year-over-year. As for gross revenue, 2019 showed a 42.5% jump to 21.8 billion reais (US$4.32bn).
With a 24% market share in 2019, General Motors led the car and LCV rental market for the fourth year in a row, according to ABLA. Wrapping up the top five brands were FCA (19.9%), Volkswagen (19.5%), Renault (13.9%) and Ford (12.7%).
As for 2020, it is difficult to measure the overall impact that the Coronavirus (COVID-19) pandemic will have on the rent-a-car industry. It depends on activities such as air transportation, corporate events, business meetings and leisure travel, all of which have dropped significantly for the time being.
Image: Paulo Miguel Junior (copyright: ABLA)