Vehicle as a Service Market Analysis

Vehicle as a Service Market Analysis

Inadequate transportation infrastructure in several countries is hampering the vehicle as a service market growth. Owing to the inefficiency of government administrations, malpractices, and inadequate maintenance of physical infrastructure, developing nations such as Afghanistan, Bolivia, Lesotho, and Nepal are facing issues with infrastructure development. This is preventing automotive subscription service providers from launching their vehicle services in these regions, impeding industry expansion. Nonetheless, an upsurge in disposable incomes across developed and emerging countries, coupled with high government emphasis on enhancing the transport sector, is anticipated to advance vehicle rental or leasing uptake in the coming years.

The IC engine segment accounted for around USD 4 billion in 2021 and is speculated to depict remarkable growth through 2030. Since the vehicle rental & leasing process is cost-effective and does not require maintenance & documentation, IC engine-based vehicle rental services are observing an upsurge in demand, which is facilitating segment progress.

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The automotive OEM segment is poised to witness a massive growth of above 24.5% from 2022 to 2030. Several automotive OEMs, such as JLR, BMW, Audi, and Volvo AB, are offering automotive subscription services in specific geographic locations with high growth potential, thereby fueling the vehicle as a service market growth.
 

The passenger cars segment is estimated to exhibit a growth rate of around 20.5% between 2022 and 2030. The growing traffic and parking problems in cities due to rising urbanization and soaring instances of road accidents are pushing customer interest toward renting or leasing vehicles instead of purchasing them, which is projected to support vehicle as a service market expansion.
 

The private users segment is predicted to showcase nearly 21% gains through 2030. The escalating awareness pertaining to carbon emissions from the increasing number of vehicles, avoiding stresses of maintaining an owned vehicle, and traffic problems in urban areas are foreseen to boost product adoption among private users.
 

The Europe vehicle as a service market revenue exceeded a valuation of USD 2.5 billion in 2021. The accelerating production of electric vehicles and improving charging infrastructure in the region will create promising opportunities for electric vehicle rental.