Dubai, UAE – The size of the car rental market in the UAE has grown by approximately 11.8%.
To reach 2.2 billion dirhams in 2025, compared to about 1.97 billion dirhams in 2024.
The report stated that the sector is witnessing continuous and regular growth at the rates recorded in the previous year.
Driven by growing demand for flexible mobility solutions by residents and visitors, both for business and tourism purposes.
In addition to the increasing number of international events attracting visitors from all over the world.
Khaiser Pasha, General Manager of «Thrifty» and «Dollar» car rental companies in Abu Dhabi, said that the car rental market in the UAE has witnessed an expansion in companies’ fleets.
With a focus on providing a variety of vehicles to meet the needs of different segments of customers.
From executives looking for a seamless and reliable experience, to entrepreneurs who prefer flexible solutions that align with their lifestyle.
Digital transformation contributes significantly to this growth.
It allows customers quick and convenient access to rental services and the selection of the vehicle that best suits their needs.
This trend also highlights the importance of having flexible and diverse fleets that include economical and luxury vehicles.
In addition to hybrid and electric vehicles, ensuring that the requirements of all categories of customers are met.
Overlapping factors
Pasha said: “The continued growth in the car rental market in the Emirates is attributed to a set of overlapping factors, most notably the strong recovery of the tourism sector, hosting major global events, and the expansion of local and international businesses”.
The rising number of temporary residents, who prefer flexible mobility solutions rather than owning vehicles, is also contributing to increased demand.
Regarding the impact of rising insurance costs on the car rental sector, Pasha stressed that rising insurance costs represent a significant challenge for the car rental sector.
It is directly reflected in operating expenses and profit margins, as insurance is an essential element in risk management and asset protection.
price adjustment
He continued: This may prompt some companies to reconsider their pricing policies.
Whether by adjusting rental prices or offering flexible insurance packages that meet different customer needs without compromising the competitiveness of the service.
In turn, this reality encourages companies to enhance safety standards in their fleets.
From meticulous maintenance to the adoption of intelligent monitoring systems.
This reduces the possibility of accidents and contributes to reducing insurance costs in the future.
principles of sustainability
Car rental fleets in the UAE are witnessing a significant increase in the adoption of electric and hybrid vehicles.
It currently represents about 5% of the total fleet, with expectations of further growth in the coming years.
This trend reflects the sector’s commitment to the principles of sustainability and reducing carbon emissions, in line with national green mobility strategies.
The expansion of charging station infrastructure and rising customer environmental awareness also support the accelerating adoption of electric vehicles.
