Car Leasing Market Size - By Vehicle Type (Hatchback, Sedan, SUV, MUV), Lease Type (Open-ended, Close-ended), End Use (Commercial, Non-commercial), Research Report, Regional Outlook, Price Trends, Growth Prospects & Global Forecast, 2023 - 2032

Car Leasing Market Size

Car Leasing Market size was valued at USD 615 million in 2022 and is anticipated to register a CAGR of over 6% between 2023 and 2032, driven by the escalating environmental concerns and regulations worldwide. Growing urbanization is fuelling the market as more people opt for flexible mobility solutions in urban areas.
 

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According to a report published by the World Bank, in April 2023, over 50% of the population lives in urban areas. By 2045, the world's urban population will increase by 1.5 times to 6 billion. Urban dwellers often face limited parking, congestion, and changing transportation needs. Car leasing offers them a cost-effective & hassle-free alternative to ownership, allowing access to vehicles when needed without a long-term commitment. The convenience of leasing aligns with the dynamic urban lifestyle, contributing to the expanding market size and catering to the evolving preferences of city residents.
 

The collaboration of automakers with leasing companies is driving the car leasing market as they offer attractive lease deals, promoting their vehicles' accessibility. This partnership allows automakers to increase their market reach, showcase their latest models, and accommodate changing consumer preferences. For instance, in February 2023, Maruti Suzuki Subscribe expanded its services with SMAS, its fifth partner. The subscription offers flexible tenures ranging up to five years including shorter one-year options. This initiative enhances consumer choices, providing extended access to Maruti Suzuki vehicles through subscription models and meeting diverse mobility needs and preferences.
 

Changing interest rates pose a challenge in the car leasing market as they directly impact the cost of leasing. Higher interest rates can result in increased monthly lease payments, potentially making leasing less attractive to consumers. Fluctuations in interest rates require leasing companies to adapt their pricing structures and marketing strategies to maintain competitiveness and meet consumer expectations for affordability.
 

COVID-19 Impact

The COVID-19 pandemic significantly impacted the car leasing market as lockdowns, economic uncertainties, and remote work trends led to reduced consumer demand for new vehicles. With financial uncertainties, potential lessees were hesitant to commit to long-term contracts. Supply chain disruptions also affected vehicle availability, and travel restrictions further decreased the need for personal transportation. These factors collectively resulted in a decline in car leasing activities and a challenging market environment.
 

Car Leasing Market Trends

Online leasing platforms are an emerging trend in the car leasing industry that reflects a transformative shift, leveraging digitalization for enhanced accessibility and convenience. These platforms and mobile apps streamline the leasing process, allowing customers to browse, customize & complete lease transactions from the comfort of their devices.
 

For instance, in November 2021, Mahindra Finance introduced Quiklyz, a specialized digital platform enabling customers to conveniently choose and lease vehicles online. Through this platform, customers can subscribe to a vehicle for durations ranging from 24 to 60 months, tailored to their specific needs, all under a comprehensive monthly fee. The trend fosters a seamless user experience, providing real-time information, transparent pricing, and facilitating efficient communication between lessees & leasing companies, contributing to a more user-centric and technologically advanced leasing landscape.
 

The integration of advanced technologies into leased vehicles is also an emerging trend in the car leasing market. Telematics and connectivity features are increasingly prevalent, offering lessees enhanced user experiences. For instance, in November 2023, Reliance Jio introduced JioMotive, an OBD-based telematics solution for cars. This technology enhances vehicle security and enables users to monitor diverse parameters, providing real-time insights into the vehicle's performance. These technologies provide real-time data on vehicle performance, maintenance needs, and even driver behaviour. Such connectivity not only elevates the driving experience but also empowers leasing companies with valuable insights for efficient fleet management. This trend aligns with the broader industry shift toward tech-driven, connected mobility solutions, fostering innovation & improving overall leasing offerings.
 

Car Leasing Market Analysis

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Based on vehicle type, the sedan segment accounted for 30% of the market share in 2022, as consumers seek diverse vehicle options. Sedans offer a balanced combination of comfort, fuel efficiency & affordability, making them attractive for leasing. With evolving consumer preferences and a desire for flexible mobility solutions, the sedan segment is expected to witness an increased demand in the market, contributing to its expansion.
 

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Based on end use, the personal segment held over 70% of the car leasing market share in 2022, due to the increasing adoption of leasing solutions by businesses. Leasing provides commercial entities with flexibility, cost management, and access to a modern fleet without the long-term commitment of ownership. As companies prioritize efficient fleet management and cost-effectiveness, the segment will witness expansion driven by the advantages leasing offers in meeting diverse business mobility needs.
 

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North America car leasing market size dominated around USD 19 million in 2022. The region has a mature automotive industry, high consumer awareness, and a strong inclination toward flexible mobility solutions. With a growing preference for leasing over traditional ownership, a well-established infrastructure & a technologically savvy consumer base, North America is expected to lead in market share. For instance, in June 2023, Ford launched a pilot program allowing Uber drivers in three California cities to lease Mustang Mach-E models. Additionally, the presence of key companies and the continuous evolution of leasing models contribute to the region's dominance.
 

Car Leasing Market Share

Major companies operating in the car leasing industry are:

• Enterprise Holdings, Inc.
• United Leasing, Inc.
• Element Fleet Management Corp.
• Wilmar Inc.
• Caldwell Leasing
• Ewald Automotive Group
• ALD Automotive

These are major companies in the car leasing industry are fiercely competing for revenue share of around 70% by prioritizing leasing mobility solutions. These companies provide comprehensive leasing solutions, fleet management services, and innovative mobility solutions, contributing significantly to the global car leasing industry’s growth and development.
 

Car Leasing Industry News

• In November 2023, AutoNation Mobility launched a micro leasing program in Florida (U.S.). The program offers shorter-term vehicle access for those wanting to try before they buy or seek a ride for a specific season.
   

The car leasing market research report includes in-depth coverage of the industry, with estimates & forecast in terms of revenue (USD Million) from 2018 to 2032, for the following segments:

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Market, By Vehicle Type

• Hatchback
• Sedan
• SUV
• MUV
• Others

Market, By Lease Type

• Open-ended
• Close-ended

Market, By End Use

• Commercial
• Non-commercial

The above information has been provided for the following regions and countries:

• North America
  • U.S.
  • Canada
• Europe
  • UK
  • Germany
  • France
  • Italy
  • Spain
  • Russia
• Asia Pacific
  • China
  • India
  • Japan
  • South Korea
  • ANZ
  • Southeast Asia 
• Latin America
  • Brazil
  • Mexico
  • Argentina
• MEA
  • UAE
  • South Africa
  • Saudi Arabia