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China's car rental services gaining in popularity

0 Comment(s)Print E-mail CNTV, July 15, 2012
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China is the biggest car market in the world, but buying a car might not be always an option for ordinary people. As a more affordable option, car rental services are gaining in popularity, both for those looking to drive, and foreign investors looking for a piece of the pie.

Opinions of renting a car

On Beijing's streets, a bicycle is the classic mode of transportation, electric bicycles are popular, but taxis and private cars are the norm. But some say renting could be gaining ground.

"Renting a car can obviously save me money and energy in terms of car maintenance and annual parking fees. Renting works for me."

"I think renting a car is a flexible option for travelling, business trips and running errands."

China's large territory and population is a plus for this young industry. But while changing social dynamics means more people with driver's licenses, tightened car-purchasing regulations make renting a more practical option.

Wang Hui, Marketing Manager, eHi Car Service, said, "We've seen increasing car maintenance expenses and other costs for private cars. Moreover, due to traffic and road conditions in big cities, the reality now is not everyone can own a car. More and more people are turning their attention to renting a car."

Convenient service for renting a car

Moreover, the process of renting a car has become more streamlined.

Now renting a car in China is very convenient, you can reserve the model, choose the date online, then pick up your car. All your need is your ID, driver's license and a credit card. The procedure is pretty much the same as walking into a branch of Enterprise in the U.S.

Meanwhile, the network of China's rental car is also shaping up. For instance, China's No. 1 rental car company China Auto Rental has established over 600 branches nationwide, covering 66 cities and 52 major airports. Another top company eHi now serves more than 50 Chinese cities.

China's rental car service providers like China Auto Rental and eHi are expanding their fleets and operations in the country to cover more areas. And the expansion of China's rental car market is speeding up.

Beautiful future of China's rental car market

According to estimates, the annual revenue of China's rental car market is expected to reach 6.1 billion US dollars in 2015 compared to 2.5 billion in 2010. Earlier this week, China's biggest rental car company China Auto Rental received 200 million US dollars in investment from U.S. private equity fund Warburg Pincus, hoping the investment will strengthen its leadership in China's car-rental industry.

Yang Yanying, Vice President of China Auto Rental Ltd, said, "The new investment is a landmark for China Auto Rental this year. We will continue to expand our car fleets through the investment. By the end of this year, our fleet is expected to exceed 40-thousand cars. And in the long-run, we are confident of China's overall car-rental market. Within a few years, experts estimate China's car rental market could near the U.S. market level, or even surpass it."

Earlier this year, a U.S. leading rental car company also made a a strategic investment and reached a global affiliation agreement with eHi Auto Services, representing an approximately 15-percent stake in eHi. China's rental car market is indeed looking up.

 
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