Saudi Arabia Car Rental and Leasing Market Outlook to 2035

The report titled “Saudi Arabia Car Rental and Leasing Market Outlook to 2035 – By Rental Duration, By Vehicle Type, By Customer Segment, By Booking & Distribution Channel, and By Region” provides a comprehensive analysis of the car rental and vehicle leasing industry in the Kingdom of Saudi Arabia. The report covers an overview and genesis of the market, overall market size in terms of value, detailed market segmentation; trends and developments, regulatory and licensing landscape, customer-level demand profiling, key issues and challenges, and competitive landscape including competition scenario, cross-comparison, opportunities and bottlenecks, and company profiling of major players operating in the Saudi car rental and leasing market.

The report concludes with future market projections based on tourism expansion under Vision 2030, growth in domestic and inbound business travel, rising urban mobility needs, corporate fleet outsourcing, government-led infrastructure development, regional demand drivers, cause-and-effect relationships, and case-based illustrations highlighting the major opportunities and cautions shaping the market through 2035.

Saudi Arabia Car Rental and Leasing Market Overview and Size

The Saudi Arabia car rental and leasing market is valued at approximately ~USD ~ billion, representing the demand for short-term rentals, long-term leasing, and fleet management services across leisure, corporate, government, and mobility-driven use cases. The market includes self-drive rentals, chauffeur-driven services, operating leases, and corporate fleet leasing covering passenger cars, SUVs, luxury vehicles, and light commercial vehicles.

The market is anchored by the Kingdom’s rapidly expanding tourism ecosystem, strong inter-city and intra-city mobility demand, rising preference for asset-light transportation solutions, and the growing role of professional fleet operators in serving corporates and government entities. Car rental and leasing services play a critical role in supporting airport mobility, religious tourism, mega-project construction activity, and business travel linked to economic diversification initiatives.

Short-term rentals are driven by inbound tourists, domestic leisure travelers, and airport-based demand, while long-term leasing is increasingly adopted by corporates seeking predictable costs, reduced balance-sheet exposure, and outsourced fleet management. Leasing is also gaining traction among SMEs and ride-hailing or delivery-oriented operators who prefer flexibility over ownership amid evolving mobility needs.

Regionally, Riyadh represents the largest demand center, supported by corporate headquarters concentration, government offices, and year-round business travel. Makkah and Madinah generate high seasonal demand linked to religious tourism, driving short-duration rentals with intense peak cycles. Jeddah acts as a critical gateway market due to its airport traffic, port-linked business activity, and tourism flows. The Eastern Province shows structurally stable demand from industrial, energy-sector, and corporate leasing customers. Emerging cities and giga-project locations contribute incremental demand through project-based leasing, workforce mobility, and contractor fleets.

What Factors are Leading to the Growth of the Saudi Arabia Car Rental and Leasing Market:

Tourism expansion under Vision 2030 structurally increases short-term rental demand: Saudi Arabia’s push to become a global tourism destination is driving sustained growth in domestic and international visitor volumes. Expansion of airports, new airline routes, religious tourism facilitation, and the development of entertainment, heritage, and leisure destinations are increasing the need for flexible ground mobility. Car rentals are often preferred over taxis for inter-city travel and family-oriented trips, while premium and SUV segments benefit from long-distance and desert-oriented travel patterns. This structural rise in visitor mobility directly strengthens demand for short-term rental fleets.

Corporate cost optimization and fleet outsourcing support long-term leasing growth: Corporates across sectors such as construction, consulting, logistics, healthcare, and government contracting are increasingly shifting from owned fleets to leased vehicles. Long-term leasing offers predictable monthly costs, reduced maintenance burden, and flexibility to scale fleets up or down in line with project cycles. For many organizations, leasing also reduces administrative complexity related to insurance, registration, resale risk, and vehicle replacement, making professional fleet operators a preferred mobility partner.

Urbanization, infrastructure projects, and workforce mobility create sustained fleet demand: Large-scale infrastructure and giga-projects across multiple regions require temporary and project-linked mobility solutions for engineers, consultants, and support staff. Leasing models enable contractors and developers to deploy standardized fleets without long-term capital commitments. In parallel, urban expansion and changing commuting patterns in major cities are supporting demand for both self-drive rentals and employer-provided leased vehicles, particularly for expatriate and rotational workforces.

Which Industry Challenges Have Impacted the Growth of the Saudi Arabia Car Rental and Leasing Market:

Fleet cost inflation and vehicle supply volatility affect pricing stability and utilization planning: The Saudi car rental and leasing market remains sensitive to fluctuations in new vehicle prices, import lead times, and OEM supply allocations. Periodic disruptions in global automotive supply chains, changes in model availability, and rising vehicle acquisition costs increase capital intensity for fleet operators. These dynamics can compress margins, delay fleet refresh cycles, and limit the ability of operators to scale capacity during peak demand periods such as religious tourism seasons or major events. For leasing players, higher upfront vehicle costs also translate into cautious contract structuring and stricter credit assessment of corporate customers.

Seasonality-driven demand creates utilization imbalances and operational inefficiencies: Demand in the Saudi market is highly uneven across the year, with sharp peaks linked to Hajj, Umrah, school holidays, and major conferences or events. While these periods generate high short-term rental volumes, off-peak months can see underutilization of fleets, particularly in religious tourism hubs. Managing fleet deployment across regions, optimizing pricing without eroding brand value, and maintaining service quality during surge periods remain ongoing operational challenges for rental operators.

Operational complexity and workforce management constraints impact service consistency: Car rental and leasing operations require coordinated management of vehicle maintenance, customer onboarding, documentation, insurance handling, and roadside support across multiple locations. Recruiting and retaining trained frontline staff, especially during rapid expansion or peak demand cycles, can be challenging. Variability in service execution across branches affects customer satisfaction and repeat usage, particularly as expectations rise with increased exposure to international rental standards and app-based mobility platforms.

What are the Regulations and Initiatives which have Governed the Market:

Licensing, classification, and operating requirements for car rental and leasing companies: Car rental and leasing activities in Saudi Arabia are governed by sector-specific licensing frameworks that define eligibility criteria, fleet size requirements, insurance coverage, pricing transparency, and consumer protection norms. Operators must comply with regulations related to vehicle registration, commercial insurance, driver documentation, and contractual disclosures. These requirements aim to formalize the sector, improve service quality, and ensure customer safety, but they also increase compliance and administrative costs for operators.

Insurance, liability, and traffic compliance regulations shaping cost structures: Mandatory comprehensive insurance coverage, third-party liability requirements, and traffic enforcement mechanisms directly influence operating economics. Accident liability management, claims processing, and compliance with traffic violation settlement processes require robust internal systems. For leasing operators, especially those serving corporates and government entities, stricter compliance standards around driver behavior, vehicle monitoring, and incident reporting increase the importance of telematics and fleet management technologies.

Vision 2030 mobility, tourism, and localization initiatives supporting long-term market expansion: Government-led initiatives under Vision 2030—including tourism development, airport expansion, giga-project execution, and private-sector participation—are structurally supportive of car rental and leasing demand. Policies encouraging economic diversification, job creation, and service-sector formalization indirectly benefit organized fleet operators. At the same time, localization expectations, Saudization targets, and evolving digital compliance requirements influence cost structures and operational planning, shaping how operators scale sustainably over the long term.

Saudi Arabia Car Rental and Leasing Market Segmentation

By Rental Duration: The short-term rental segment holds dominance. This is because airport-linked mobility, religious tourism (Umrah/Hajj), domestic leisure travel, and business visitor movement generate high-frequency, short-duration demand that aligns strongly with the operating model of organized rental players. Short-term rentals benefit from high transaction volumes, dynamic pricing potential, and strong seasonal peaks in Makkah–Madinah and Jeddah corridors. While long-term leasing is expanding rapidly due to corporate fleet outsourcing and project-based mobility needs, the short-term segment continues to lead due to tourism-led volume demand and city-to-city travel preferences.

Daily (1–7 Days)  ~35 %
Weekly (8–30 Days)  ~25 %
Monthly (1–6 Months)  ~20 %
Long-Term Leasing (6–36 Months)  ~20 %

By Vehicle Type: Economy and mid-size sedans dominate the market, followed by SUVs. Price sensitivity among mass travelers and corporate users makes economy and mid-size vehicles the most utilized category, especially for airport rentals and city mobility. SUVs retain strong relevance due to Saudi driving preferences, family travel patterns, inter-city routes, and higher comfort expectations, leading to higher revenue per day even if unit volumes are comparatively lower. Luxury rentals remain smaller in volume but strategically important in premium tourism, executive mobility, and event-driven demand.

Economy & Compact  ~40 %
Mid-Size & Full-Size Sedans  ~25 %
SUVs & Crossovers  ~25 %
Luxury & Premium  ~5 %
Light Commercial Vehicles (Vans/Pickups)  ~5 %

Competitive Landscape in Saudi Arabia Car Rental and Leasing Market

The Saudi Arabia car rental and leasing market exhibits moderate concentration, characterized by a mix of large domestic rental brands with nationwide branch networks, diversified mobility groups, and specialized leasing/fleet management companies serving corporate and government clients. Market leadership is driven by fleet scale, airport presence, digital booking capability, pricing discipline, service quality, insurance/claims handling, and the ability to manage seasonal demand surges. While organized national players dominate airport and corporate accounts, regional operators remain competitive in local city rentals by offering aggressive pricing, flexible documentation handling, and localized fleet availability.

Some of the Recent Competitor Trends and Key Information About Competitors Include:

Theeb Rent a Car: As one of the most visible domestic brands, Theeb’s competitiveness is reinforced by strong airport coverage, large-scale fleet operations, and increasing focus on digital bookings and customer experience consistency. Its ability to manage high seasonal volumes and maintain utilization across cities supports leadership in short-term rentals.

Lumi (Al Wefaq Rent a Car): Lumi’s positioning is strengthened by fleet scale expansion and a balanced presence across retail rentals and corporate accounts. The brand continues to differentiate through organized fleet management practices, growing digital reach, and structured leasing offerings for business customers seeking predictable cost models.

Budget Saudi (Alesayi Group): Budget competes strongly in airport-driven demand and value-focused segments, supported by brand recall, standardized processes, and broad access to travelers. Its strength is particularly visible in high-volume leisure travel corridors where price competitiveness and availability drive conversion.

Hertz / Sixt / Enterprise (operator/franchise presence): International brands remain relevant in premium traveler segments and corporate programs where standardized global service expectations, process reliability, and brand trust influence selection. These players typically focus on airport counters, business travelers, and higher-spec vehicle categories where service assurance matters.

Regional and value-led operators: Smaller and regional players remain competitive through flexible documentation, localized pricing, and fast fleet availability in specific cities. However, scaling constraints in fleet funding, service standardization, and claims handling often limit their ability to compete for large corporate accounts.

What Lies Ahead for Saudi Arabia Car Rental and Leasing Market?

The Saudi Arabia car rental and leasing market is expected to expand steadily by 2035, supported by Vision 2030-led tourism growth, rising domestic mobility, increasing corporate fleet outsourcing, and expanding giga-project and infrastructure execution across regions. Growth momentum is further enhanced by improving airport connectivity, rising preference for app-based booking and digital onboarding, and increased demand for flexible mobility solutions that reduce ownership burden for both individuals and organizations. As the Kingdom scales inbound leisure and business travel while corporates prioritize predictable fleet costs and service reliability, organized rental and leasing players will remain central to the evolution of Saudi mobility through 2035.

Shift Toward Fleet Standardization, Higher Utilization, and Asset-Light Mobility Models: The market will increasingly move from fragmented, branch-led rentals toward more standardized fleet categories, optimized utilization, and stronger lifecycle cost management. Operators will focus on improving vehicle rotation, reducing idle time across seasons, and deploying fleets dynamically between Riyadh, Jeddah, and the Makkah–Madinah corridor. Leasing demand will expand as companies aim to convert fleet ownership into service contracts that bundle maintenance, replacement cycles, and insurance into predictable monthly costs. Players with strong procurement discipline and utilization analytics will strengthen margins and resilience.

Rising Demand for Long-Term Leasing and Fleet Management Among Corporates and Government-Linked Entities: Through 2035, corporate and government-linked leasing will grow as a core stabilizer for the market. Large employers will increasingly prefer operating lease structures and managed fleet models to reduce administration and downtime, especially for sales fleets, service teams, project sites, and rotational staff mobility. As giga-projects mature and contractor ecosystems scale, structured leasing contracts will expand for workforce mobility, on-site operations, and inter-city travel requirements. This will strengthen the position of operators with enterprise sales capability, service SLAs, and nationwide maintenance networks.

Acceleration of Digital Booking, Seamless KYC, and App-Based Customer Experience: Customer expectations will increasingly be shaped by speed and convenience—instant booking, digital KYC, quick deposits, transparent pricing, and rapid vehicle handover. App-based experiences will become a key differentiator, especially for airport rentals and frequent travelers. Operators will also push dynamic pricing and subscription-like monthly bundles to retain customers across seasons. As digital platforms become more influential, brands that can combine strong online visibility with reliable service execution will capture repeat demand and premium pricing.

Premiumization and Segment Expansion into SUVs, Multi-Purpose Vehicles, and Chauffeur-Enabled Offerings: While economy and mid-size vehicles will remain volume leaders, the market will see continued premiumization in SUVs and comfort-led categories due to Saudi driving preferences, family travel, and longer inter-city routes. Demand will also rise for multi-purpose vehicles for group travel and tourism packages, while chauffeur-enabled offerings will expand in premium tourism, business mobility, and event-driven demand. Operators that manage premium fleet depreciation and service quality effectively will benefit from higher revenue per transaction.

Saudi Arabia Car Rental and Leasing Market Segmentation

By Rental Duration
• Daily (1–7 Days)
• Weekly (8–30 Days)
• Monthly (1–6 Months)
• Long-Term Leasing (6–36 Months)

By Vehicle Type
• Economy & Compact
• Mid-Size & Full-Size Sedans
• SUVs & Crossovers
• Luxury & Premium
• Light Commercial Vehicles (Vans/Pickups)

By Customer Segment
• Leisure & Religious Tourism
• Corporate & SME (Business Use)
• Government / Semi-Government Fleets
• Mobility Operators (Ride-hailing / Delivery Partners)

By Booking & Distribution Channel
• Online Aggregators & OTAs
• Direct Operator Website/App
• Airport Branch / Walk-in Counters
• Corporate Direct (B2B Leasing Contracts)

By Region
• Riyadh Region
• Makkah Province (incl. Jeddah)
• Madinah Region
• Eastern Province
• Other Regions (Asir, Tabuk, Qassim, etc.)

Players Mentioned in the Report:

• Theeb Rent a Car
• Lumi (Al Wefaq Rent a Car)
• Budget Saudi (Alesayi Group)
• Hertz Saudi Arabia (operator/franchise presence)
• Sixt Saudi Arabia (operator/franchise presence)
• Enterprise Saudi Arabia (operator/franchise presence)
• Key Car Rental and other regional operators
• Fleet leasing and fleet management service providers supporting corporate and government mobility

Key Target Audience

• Car rental and leasing companies and fleet operators
• Corporate procurement teams and fleet managers
• Government and semi-government transport procurement departments
• Airports, travel ecosystem partners, and tourism operators
• Mobility aggregators, OTAs, and digital booking platforms
• Automotive OEMs, dealers, and fleet sales divisions
• Insurance providers and claims administrators
• Investors evaluating mobility, tourism-linked services, and fleet platforms

Time Period:

Historical Period: 2019–2024
Base Year: 2025
Forecast Period: 2025–2035