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Recreational Vehicles have been in the market for a long time. Some common types of recreational vehicles are motorhomes and campervans.
Due to the high cost of purchasing and maintenance of RVs, a new market for renting recreational vehicles has gained popularity over the years, with the highest prominence in the North American region owing to the high disposable income of the people of the region.
The RV Rental companies lease recreational companies and also for private fleet owners they offer consigning services.
In the past 5 years, the growth of this industry has been positive however in the last year the growth was negative owing to the travel restrictions in many parts of North America. The demand may remain low in the next 2 years and may increase thereafter.
Since this market is heavily dependent on the economic conditions of the region, the demand for such recreational vehicles being rented might be low.
In 2020, due to the lockdown, travel was restricted and people cut down on their leisure spending which may affect further growth in this market as well. At the same time, the fixed cost of maintaining these fleets is high and low demand in the previous year caused loss in revenue and profits for the fleet owners.
Along with this there is also assistance by the industry and the consumer confidence index is not very high.
The online channel is preferred more due to the several advantages it offers. Firstly, it is more convenient than the offline channel. Secondly, a comparison between different rental services can be done in a click.
Thirdly, many such online rental service information platforms such as RVshare.com have emerged which give sufficient information required by any user before booking.
The United States has the largest market demand (approximately 50% of the whole of the North American Recreational Vehicle Rental Market).
The reasons for the same are – the high cost of owning RVs make people prefer renting them. Individual owners have realized the potential of renting their vehicles and hence offer rental services.
Many rental sharing platforms have also emerged in the past in the US which add to the convenience of renting these vehicles. There are also a high number of RV parks and campgrounds which are adding to the growth of this market.
The competitors in this industry compete on the basis of mainly four parameters – cost of renting, location of the renting services, availability of fleets and customer service.
The competition in this market is concentrated with the top few companies with more than 50% of the market share among 3-4 companies. There are high barriers to entry in this market as it requires a huge amount of capital to be invested initially for buying a fleet of recreational vehicles and further maintaining it.
Some of the players in the market are :
Acquisitions have been a common strategy in the North American region to increase the market share. The number of peer to peer RV rental websites is also expected to increase in the next 5 years which will increase the competition among the players in the market. The rental services will have to be provided at a lower price owing to the increased competition.
Tourism Holdings Limited
This company has seen tremendous growth in the past owing to its acquisition of companies. It acquired El Monte RV which further helped it grow. It also offers the latest models of motorhomes fleet under the brand Road Bear RV which further helped it to gain popularity in not only the US but other countries as well. It has been able to increase its reach and network providing more locations for pick up and drop.
Apollo Tourism and Leisure Ltd.
Apollo Tourism and Leisure Ltd. acquired the company CanaDream. Since CanaDream was based in Canada, Apollo Tourism and Leisure Ltd. was able to expand its reach and provide services in Canada which it wasn’t earlier.
Additional services being provided by companies to maintain their share in this highly fragmented market
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