Car rentals gain momentum, eager to return to fast track

Self-drive and cab services had slowed down because their customers are mostly home

Self-drive car rentals, which many expected to thrive, are trailing. The reasons are many.

With public transport being seen as risky, car rentals were seen as a ready, safe alternative, but work from home has put paid to their growth dreams.

For RideAlly, business is currently at 10 per cent of what it used to be till February this year. Hariprakash Agrawal, founder-CEO, says, “Even those who regularly used our cars are using their own cars now. It’s surprising though, since a private car might not be as sanitised as our cars.”

From sanitising surfaces after every ride to sanitising the whole car once a week, the company is being extra careful. Car rental and cab services were both hit badly by the lockdowns, he says.

“Bengaluru has a large IT industry and most employees are working from home now. We are hoping our corporate clients will be back by December,” he says.

About 80 per cent of the Zing Cars fleet would always be booked, but that was till March. Edward Benjamin, fleet manager, says bookings have dropped to 40-50 per cent. “Since not many offices have opened, our business is suffering,” he says.

Carzonrent hopes the business is on the path of recovery. Rajiv Vij, chairman and managing director, says, “The industry has two parts: individuals and business travellers. The former are looking at dedicated vehicles for themselves, and using their own vehicles instead of taxi services.”

Business travellers are coming back, as small and medium businesses have opened up. “Even they want vehicles dedicated to them,” Vij says. With flights and hotels still being closed, car rentals have a long way to go before they are back on the fast track. “Business went down to 10 per cent during the lockdown, and it is now at 25 per cent of what it was pre-Covid-19,” he says.

Carzonrent follows many safety measures, and provides a shield between the driver and the passengers.

The company has launched a driver service: customers can hire a driver for just a few hours or an entire month. “Many permanent drivers working for individuals have left, which is where this option becomes useful,” he says.

Consistent rise

Savaari Car Rentals is now at 60 per cent of its pre-pandemic business. Gaurav Aggarwal, founder and CEO, says, “We have been seeing a consistent rise in demand since the unlocking.”

He observes that recovery of air travel was just 15 per cent in June, compared to car rentals, which have recovered faster.

“At this point, essential travel is taking place, which has led to an increase in one-way travel from one city to another,” he says.

Of the trips that have resumed, about 90 per cent are intercity. “Cars hired for eight to 10 hours for city travel and rides to the airport are fewer comparatively; they are at just 5 per cent each of the total business,” he says.

Long term

For MyChoize-Self drive cars, owned by Orix India, business is coming back in a different form. Sandeep Gambhir, managing director and CEO, says self-drive was an option used for weekend getaways. “There is fear about using public transportation and Metros are not working. Passengers do not want to use shared cars,” he explains.

Demand patterns have changed: cars booked for three days have now expanded to 15 days, and in some cases, to months. “Longer term rentals are priced better,” he says.

MyChoize has resumed 40 per cent of its original business now. “We were down to 15 per cent during the lockdown,” he says. Inter-state trips are hampered by the many restrictions in place.

Safety, not discounts, on mind

Car rental companies say safety, and not discounts, will lure passengers back.

Safety measures include airing and sanitising of cars every day.

Customers are also advised to bring their own linen for use on the seats.