COVID-19 and Rental Car Industry

Covid-19 is the worst challenge seen since World War 2. It had a big impact on the global economy. As a result, car rental companies suffered many huge losses. Car rental booking reduced soon after its outbreak in China. Meanwhile, the cancellations increased. Actually, car rental companies reported 35 percent losses in 2020 alone.

Many people canceled their car bookings because they suffered from chronic illnesses. Still, some claimed that they had plans of traveling with their babies and young children. Pregnant mothers were also in the group of those who canceled rental car bookings. They did that mainly because they feared for their health.

However, Covid-19 was not the sole cause of cancellations. Governments issued travel advisories that reduced travel. They further instituted lockdowns that forced airlines to close business. We have listed the steps car rental companies adopted to deal with the challenges. But first, here is what happened after the Covid-19 outbreak.

– Car Rental Initiatives

Most companies asked their employees to work from home. They have also discouraged travel. That alone has reduced the demand for rental cars. Government restrictions have also reduced inter-city car rental booking.



Still, car rental companies have found relief in cross-city car booking. Dubai has stable inter-city bookings. That is for the reason that many people prefer rental cars over public transport. Further, they mostly go for long-term rentals, such as monthly and annual rentals. Long-term rentals allow them to keep the cars for many days.

Besides, many rental companies are disinfecting cars after every use. That is to reduce the spread of covid-19. 

– Reduced Rental Prices

Low demand for rental cars forced companies to reduce rental prices. It also forced them to adopt other ways of making money. Delivery of rental cars cannot be preplanned. For that reason, they cannot use their cars for other purposes. That alone has forced them to de-fleet. Unfortunately, buying cars is not on the to-do list of many people. In some markets, the demand for used vehicles is very low. That includes cars sold at half the original price.

– Cancellation of New Car Releases

Most people opt for new models and makes when renting cars. Covid-19 changed that. Many manufacturers canceled the release of new cars forcing them to stick to the old models. For example, Ford canceled the release of their Bronco model. Many companies also canceled the design, marketing, and testing of new arrivals.

– Offices have Become Irrelevant

Physical offices are expensive to run. Moreover, those that do not perform as expected can have a big impact on the company’s profits. So, companies are only opening offices in profitable areas. They may open offices in airports and the main tourist destinations.

– Lockdown-Proof Return Policies

These policies were important. To help you understand, let us consider this real-life scenario. A customer rents a car for 15 days. On the 13 days of the car rental, the government announces a lockdown. Such occurrences may force the customer to pay more money for the additional days. Rental companies know the reasons for delays. For that reason, they did not charge their customers for the additional days.

The Strategies Rental Car Companies Adopted

Rental car companies adopted many strategies to counteract the effects. Here are some of the strategies.

The Strategies Rental Car Companies Adopted


  • They adopted better methods of cleaning their vehicles after each rental. In other words, they started paying cleaning the interior of each car thoroughly. They have to clean the door handles, seats, and steering wheels. Also, they spray disinfectants to ensure that each car is safe to drive.
  • They adopted new ways of cleaning their office. Further, they started cleaning them more often.
  • Car rental companies started focusing more on the safety of their employees. They instructed their employees to stay at home. They also encouraged them to regularly wash their hands and wear face-masks.
  • Most companies made the rental process flexible. Customers could book and cancel their rental at any time. They could also change the cars and dates at no cost.
  • Many rental companies launched contact-free car rentals. They launched smartphone apps, which minimized contact between customers and their agents. They also allowed their customers to choose car pickup and drop-off locations.
  • Companies stopped offering leisure and corporate car rentals. They provided delivery and logistic services. That helped them continue with operations and avoid making huge losses.
  • Most companies started changing the mindset of their customers. They started encouraging them to choose safe cars in place of inexpensive ones.
  • They started tracking the booking trend to manage the size of their fleets properly.

Are Rental Cars Safe?

Travelers are opting for domestic, regional trips near their home. Such trips are accessible by cars. While Covid-19 is still spreading in many parts of the world, rental cars are safe. Car rental companies adopted many measures to curb the spread of the disease. For example, they adapted rigorous cleaning protocols.

They clean and sanitize their cars after every rental. Therefore, expect clean key/key fob handles, the exterior, and the steering wheel. Further, the car rental companies ensure that the spaces between the seat belts, consoles, doors, cup holders, and dashboard are clean.

Car rental companies are also encouraging online rental booking. They do that to prevent the spread of the coronavirus. You do not have to set your feet in a rental facility to book a car. Some will also deliver the car to your location of choice.


The reduced demand for rental cars led to a reduction in rental prices. Today, rental car charges are very low. Some companies may also offer over 50 percent coupons and discounts. Industry watchers have predicted that the demand might increase in summer. That is due to the large number of travelers witnessed in the hot months.

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