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Corporate Car Rental is witnessing a healthy growth | Representational Photo
The Indian corporate mobility market is experiencing robust growth, driven by regulatory changes, technological advancements and economic growth, according to a report.
Both the Employee Transportation Services (ETS) and Corporate Car Rental (CCR) sectors are expanding, catering to the evolving needs of businesses and individuals alike, analysts and industry insiders claimed.
The ETS market, valued at ~50,350 crore ($6.1 billion) in 2023, is projected to reach ~1,09,760 crore ($13.2 billion) by 2030, according to the Red Herring Prospectus (RHP) by Eco Mobility, a car rental company.
This growth is fueled by the increasing number of corporations, particularly in the IT and Global Capability Centers (GCC) segments, seeking reliable and convenient commuting solutions for their employees.
The CCR market, estimated at ~39,240 crore ($4.7 billion) in 2023, is also witnessing healthy growth, driven by factors such as rising business travel needs, a focus on employee well-being, and demand for premium services. It is expected to reach an annual revenue of ~73,180 crore ($8.8 billion) by 2030.
Ashok Vashist, founder & CEO of Wise Travel India Private, highlighted the transformative potential of the employee transportation sector.
“Organised fleet operators, tech players, and a consortium of both will dominate the market. The rise of the gig chauffeur concept will revolutionise mobility, as it becomes a popular option across all forms of transportation. This will result in a steep rise in chauffeur costs, making self-drive options more appealing. The future will witness a focus on sustainability, digitisation, safety, and expansion into tier 2 and 3 cities,” he said.
The growth of both markets is primarily attributed to economic growth as India’s expanding economy and rising disposable incomes are driving demand for corporate mobility services. Along with that, regulatory changes such as the easing of permit regulations and the introduction of online aggregator platforms have facilitated market expansion, the RHP said.
Technological advancements such as electric vehicles and ride-hailing apps are influencing both markets, offering new opportunities and challenges, the report stated.
While the future looks promising, the industry faces challenges such as concerns regarding vehicle licencing and driver training. Policy interventions are necessary to address these issues and ensure sustainable growth.
Given its broader appeal and ability to cater to the needs of a larger corporate segment, the ETS market is expected to experience faster growth. Whereas, the CCR market is poised to benefit from the growing demand for premium services, especially among businesses and individuals seeking comfort, convenience, and reliability.
Electric vehicles and advanced technologies are expected to play a crucial role in shaping the future of both markets, reducing operational costs and improving efficiency. The market will witness increased competition from other mobility solutions, such as public transportation, ride-hailing, and self-drive car rental, it said.
First Published: Aug 25 2024 | 10:49 AM IST
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