Auto Rental & Leasing NAICS 532111, 532112

Mar 21, 2025 - Trade Groups, Companies Form Organization to Promote Vehicle Owners Rights.

• In February, several trade associations and companies formed the American Vehicle Owners Alliance (AVOA) to advocate for owners – individuals and businesses – to control their vehicles’ data. Modern vehicles generate, store, and transmit troves of data, and some manufacturers limit data access and control, or charge fees for it. The executive director of the American Car Rental Association (ACRA) said, “Rental car operators rely on this data to enhance the customer experience and improve vehicle safety. Giving vehicle owners — including rental car companies — full access to their own data is essential for a competitive and consumer-friendly rental market.” Members of the AVOA include the ACRA, Hertz, the National Consumer League, the National Association of Fleet Operators, Enterprise Mobility, the Truck Renting and Leasing Association, Safelite, and The American Property Casualty Insurance Association. The AVOA aims to work with Congress and the Trump administration to ensure owners maintain control over vehicle data.
• Weakening outlooks by US air carriers could signal softer car rental demand. Four major US airlines – American, Delta, JetBlue, and Southwest – recently reduced their outlooks amid a slowdown in domestic air travel demand and wavering consumer confidence, according to Forbes. In Securities and Exchange Commission filings in March, the four airlines lowered their outlooks by various metrics. Citing weaker consumer and business confidence brought on by macroeconomic uncertainty, Delta reduced its Q1 2025 outlook by 40 to 50 cents per share. American Airlines said it expects a Q1 loss between 60 and 80 cents per share, up from 20 to 40 cents in a previous forecast. Southwest cut its Q1 projection for Revenue per Seat Mile by 3%, and JetBlue moved its estimate for minimum Q1 losses up to 4% from 2%. Some economists suggest the Trump administration’s trade policies have increased the odds of a recession. A drop in air travel demand is often a bellwether of a slowing economy.

• Revenue in the US car rental industry declined in 2024 after three straight years of solid year-over-year gains, according to Auto Rental News’ (ARN) annual Fact Book for 2025. ARN estimates that US auto rental revenue reached $37.9 billion in 2024, down from $38.4 billion in 2023. Flatter revenue growth stemmed from weaker demand, excess fleet numbers, lower rental rates, and higher vehicle depreciation costs. Monthly revenue per unit (RPU) – a measure of a fleet’s revenue generation – fell to $1,387 in 2024 from $1,412 in 2023. Industry insiders suggest that while the industry has moderated from the record sales and profits during the pandemic, the outlook is still solid. Leisure travel has surpassed pre-pandemic levels and is expected to continue growing for the next three years, according to US Travel Association forecasting. However, business travel will not likely return to 2019 levels until 2026.
• On his first day in office, President Donald Trump signed an executive order to roll back several Biden-era climate initiatives, which could include repealing the $7,500 consumer tax credit for EV purchases, according to The New York Times. If the tax credits are removed, it would also make leasing an EV more expensive, according to Bloomberg. The tax credits are offered through the Inflation Reduction Act (IRA), which requires qualified vehicles to be assembled in the US and have a defined percentage of battery parts and other components originating in the US. However, fleet owners – including car makers’ finance arms – are exempt from the IRA rule. Automakers can claim the $7,500 credit then pass the savings on to lease customers. The tax credit has made EV leases competitive with gasoline-powered vehicles.