Why Invest in a Car Rental App Development?

The car rental app market is witnessing a significant increase in global revenue for quite a long time, with nearly 73% generated through online sales set to achieve a whopping $116 billion in revenue by 2028.

Besides being a huge industry, the car rental industry is constantly growing with the user’s commuting needs, which is often part of everyone's routine and makes expansion certain.

Following this, the car rental app is not just limited to big names in the industry, small and mid-sized businesses are also testing the water by opting for car rental app development.

Let’s shed some light on the car rental industry statistics.

• Revenue is estimated to show a compound  annual growth rate (CAGR 2020-2024) of 18.5%, resulting in projected market volume of US $105,285 in 2024.
• The Average Revenue Per User (ARPU) is predicted to be US $200.37.
• In 2024, the user penetration is forecasted to reach 7.1%.
• According to EinPresswire, the US is home to ~50% of the global luxury car rental market.
• By 2027, the global car rental market size is predicted to reach $144.21 billion with a CAGR of ~6.7%.
• The global car rental market is expected to accomplish USD 132.10 billion in 2024 with a projection to reach $220.10 billion by 2029, growing at a CAGR of greater than 10.75% for the projected time period.

• If you are still at square one striving to cement footsteps in the car rental industry, you must be up-to-date with market trends. An unskippable indicator that you are picking on the right trend is if your startup succeeds in raising funds.

Let’s discover what made India-based Zoomcar raise $0.46 million in 2024, from a series E round braced by American corporate venture capital:

• A huge fleet of more than 10,000 cars.
• Keyless Entry (KLE) system that facilitates users to unlock cars through smartphones.
• Passive Entry Pass Start (PEPS) enables users to enter cars and start engines without physically using the keys.
• An IoT (IoT-driven full-stack system) tracks real-time in-car data, including fuel levels, clutch position, driving behavior, harsh brakes, seat belt usage, inconsistent acceleration and engine health.
• Zoomcar Mobility Services (ZMS) that leverages AI and ML to analyze millions of data points clutched over 1+ billion kilometers of driving experience to minimize operational costs, eradicate the tiniest possibility of any accident, increase vehicle profitability and enhance customer experience.
• Finally, Zoomcar’s commitment to significantly focus on EVs (Electric Vehicles).

The last reason curates as a trendsetter among all strong car rental brands. Furthermore, Crunchbase states that recent funding signals that investing in the fastest-growing market accompanied with their high-risks/high ROI opportunities stays prevalent for investors:

• Zuru, a kenya-based car rental company, established in 2018, raised an undisclosed amount in October 2021 from a Pre-Seed round.
• Kovi, a Brazil-rooted car rental company raised a mind-boggling $104M in 2021 from a Series B round.
• Telgani, a Saudi Arabia- based car rental platform, raised $2.5M in 2021 from a Seed round.

You must be wondering what is the magic trick behind these startups raising funds? What do you really need to make your car rental app attract investments? Simply Contact Us to find answers, we know how to develop a potent pitch deck to get your car rental app noticed by potential investors.

Which Business Model of Car Rental App to Choose?

It’s important to choose how your car rental app will answer user’s wants if you want to step into the car rental app development market. Here’s a handful of pocketed categories of these apps.

Cab Service

Taxi hailing business model, allowing users to schedule a taxi for a ride in advance or in real-time, is among the top picks for vehicle rental app development. In addition, these types of solutions are integrated with driver profiles and review features that help in delivering a satisfying and personalized experience.

Often, car rental app users can choose from an exclusive array of cars that are easily noticeable in maps. Let’s shed light on people loved car rental app:

“Uber” is a popular niche player with a presence in more than 785 cities. Integrated with numerous payment choices, it allows users to easily grab hands on taxis, ride-sharing vehicles or luxury-segment cars. Another unskippable name in the commuting segment is “Lyft”, curating its footsteps in the US and Canada. Users just need to choose the drop-off location, the app will find a ride and show the charges upfront.

Read More - Build Taxi Booking App Like Uber

Peer-to-Peer Sharing

What set’s this business model different from others is their UVP (Unique Value Proposition).

In the peer-to-peer sharing business model, individuals can rent cars from private owners rather than companies. This service might come handy in numerous situations, like when you wish to explore other cities and your car breaks down unexpectedly, or you want to try a new model or car. Moreover, this addresses the parking challenges as well.

When a person needs a car, they just have to decide on a destination, a host, vehicle type, and the area where they want the owner to drop the vehicle.

One of the best illustration of on-demand car rentals app development for vehicle sharing include:

“Turo” is an excerpt of peer-to-peer sharing car app in Canada, UK and US, Germany, etc with 4.8 ratings and more than five million downloads. Turo offers an exclusive array of vehicles ranging from BMWs, Tesla, Hondas and Toyotas.

On the contrary, Getaround offers hourly as well as daily rentals compared to Turo only providing daily rentals.

In this segment, companies build a car rental app offering users vehicles who can drive. It’s beneficial for those who have driving licenses but don’t own a vehicle yet. Or, a situation where a person's car is damaged and they need a temporary vehicle to get things done without any delay.

In addition, if a customer requires a car only on work basis, or doesn't even want to maintain a vehicle, this service may seem more cost-effective. Users of autonomous service can easily book cars, vans, trucks or other vehicles in the app and pick them up from the desired location. Typically, a mobile app is used by a client to pay for the service used or in some cases to extend the hired time period.

Examples of this type of car rental mobile app development

More than 5 million people have downloaded the RentalCars app, allowing users to rent a car in more than 160 countries. Moreover, nearly a million individuals have downloaded the auto and rental aggregator app, allowing customers to rent a car anywhere and anytime.

Herein, we’ve shed light on the most common types of car rental apps. However, there are a myriad of other options, consisting of corporate, inter-city rentals, neighborhood, etc on the list of car rental app development.

Top 10 Features for a Car Rental App

The functionality of a car rental app may seem extensive at first, although not every feature carries the same priority. In the starting of car rental app development, you should consider integrating the most crucial features, and gradually expand the app’s capabilities by adding new updates and functionalities.

You should also keep in mind that some car rental app features require an interface to cater different types of users, like:

• A user looking to rent a car
• A car owner offering his services
• An admin showing the application

Let’s list the features that must be included to build a successful car rental app.

1. User Registration and Profile Management

Allow users to sign up with their email, contact number or social media accounts. Also, make sure to provide a user-friendly interface for managing their profiles, consisting of personal information, payment methods, credentials and payment methods.

2. Search and Filter

This is among the most important on-demand car rental app features. This feature would include a dynamic search functionality that can sift through available cars based on different criteria like date, time, location, car model, fuel or brand.

Filters could consist of choosing a cost bracket, picking between automatic or manual transmission, specifying a fuel type or looking for added-on features like GPS or child seats.

3. Booking and Reservation

Offer a hassle-free booking process with real-time availability. Besides, allow users to select pick-up and drop-off location, choose rental periods, and view pricing details. Establish a reservation system to secure booking.

4. GPS Navigation and Tracking

Integrate GPS navigation in your car rental app to help users locate the vehicle or car-pickup point. Provide real-time tracking of vehicles for heightened security.

5. Payment Gateway Integration

Integrate numerous payment options, consisting of credit/debit cards, digital wallets and bank transfers. Make sure the payment is secure and protected with encryption and comply with payment industry standards.

6. Review and Ratings

Enable users to rate and review their experience with your car rental app. Show ratings and reviews for each car to help users make informed decisions.

7. Alerts and Push Notifications

Send push notifications for booking confirmation and updates about ETA of vehicle approaching. Moreover, notify users regularly with reminders, promotions and important updates, helping users stay engaged and informed.

8. Customer Support

Offer in-app customer support through call, chat or email. Please, ensure to include a comprehensive FAQ section to address common questions.

9. Discounts and Loyalty Programs

Include loyalty programs to reward frequent users. Give discounts and promotional offers to attract new users and simultaneously retain existing users.

10. Multi-Language and Currency Support

Address a global audience by supporting multiple languages and currencies. This will enhance the user experience for international travelers.

Advanced Features To Include In Your Car Rental App in 2025

Users today are looking for intelligent, frictionless, and personalized experiences from all applications they consume. By incorporating sophisticated car rental app features, you can increase interaction, create loyalty, and generate increased revenue. Let us discuss the leading next-generation features that will take your app from good to legendary.

1: Personalized AI-Powered Smart Suggestions

Artificial Intelligence makes every user feel like the app was built just for them. It studies user behavior, preferences, and booking history to suggest the right vehicles at the right time. Personalized experiences improve retention and help users find their ideal ride faster.

2: Smart Contracts with Blockchain Security

Blockchain adds trust by enabling secure, transparent rental contracts and payments. With smart contracts, users don’t worry about tampering or fraud. Every transaction is verifiable, encrypted, and processed in real time, building confidence in every booking.

3: Virtual Car Tours with AR Technology

Augmented Reality enables one to virtually check a car prior to a reservation. They can walk through the interiors, look for features, and see details from all sides. It eliminates doubt and builds trust through a real-world visual experience.

4: Connected Cars with IoT Integration

Smart cars networked through IoT offer real-time information on fuel, tire pressure, and engine condition. The user can lock/unlock the car remotely or monitor its location. This aspect introduces automation, security, and contemporary convenience into the rental process.

5: Voice Commands for Hands-Free Access

Including a voice assistant enables users to search cars, check reservations, or receive hands-free assistance. It enhances navigation and adds accessibility in terms of time consumption. This feature is particularly useful for users in transit or in a hurry.

6: Gamified Rewards and Challenges

The application gains both fun and addictive characteristics through gamification features. Users receive badges with discounts and accumulation of points when they make regular bookings or make sustainable choices. The combination of this approach increases user retention and maintains continuous platform usage from customers.

7: Dynamic Pricing Powered by AI

Smart pricing algorithms dynamically adjust rental prices based on demand, weather, or vehicle availability. This helps maintain competitive prices while optimizing revenue. Customers benefit from flexible rates, and businesses optimize fleet usage.

8: Eco-Friendly Options and Carbon Offset

Offer electric or hybrid vehicles and show users their environmental impact. Provide the option to offset carbon emissions during checkout. It appeals to eco-conscious users and strengthens your brand’s green image.

9: Instant Insurance and Damage Claims

Let users purchase insurance or report vehicle damage directly in-app. They can upload photos, write descriptions, and get instant confirmation. This smooth, paperless process saves time and reduces customer frustration.

10: Social Features and Travel Sharing

Allow users to post travel photos, rate cars, and share experiences with friends. Social sharing increases app engagement and provides free marketing. It turns users into community members and brand advocates.

Car Rental App Development Process in 9 Easy Steps

Car rental mobile app development is no rocket science. Indeed, it’s all about building a seamless and user-friendly app that caters the evolving needs of modern customers.

This handy guide envelopes market research, meticulous planning, and integrating essential features to ensure a successful and competitive app.

Step 1: Market Research and Analysis

Before going into the nitty-gritty of the development process, it’s important to conduct a thorough market research. Understand your target audience, their preferences and the latest trends in the car rental industry.

Do analyze your competitors to tap into the market by bridging unmet gaps and opportunities for innovation.

Step 2: Outline Your App’s Goal

Clearly define your app’s objective.

Are you targeting tourists, daily commuters, business travelers? Are you planning to offer short-term rentals, long-term leases or both? Answering these questions will help you outline your app’s objectives with a clear and focused development plan.

Step 3: Select the Right Platform

Decide whether you want to build a native app for iOS or Android, a cross-platform app, or a web based app. Each option carries its own pros and cons.

• Native Apps: Offer better performance and user experience but need different development approaches for iOS and Android.
• Cross-platform Apps: This type of apps allow you to have a single code for both platforms but may incur compromises on performance metrics.
• Web-Based Apps: These apps are easy to develop and maintain but might not provide the same level of functionality and offline capabilities.

Step 4: Wireframing and Prototyping

Create wireframes to visualize the app’s layout and user flow. Tools like Sketch, Figma, and Adobe XD can help you design the app’s interface. Develop a prototype to test the app’s functionality and gather feedback from potential users.

Step 5: Development

• Front-End Development

Focus on building an engaging and responsive user interface. You can consider technologies like Flutter, React Native, Swift for iOS or Kotlin for Android to develop the front end of an app.

• Back-End Development

Back-end development is important to manage user data, payments, bookings, and car inventory. Use frameworks like Node.js, Ruby on Rails, Django or even consider using cloud services like AWS or Firebase for easy scalability.

Step 6: Features Integration

Include essential features to make sure your app caters to users expectations. Plus, try to integrate Artificial Intelligence and Machine Learning for a flawless user experience.

Step 7: Testing

Test the app thoroughly to identify and fix bugs before rolling out the app. Perform functional testing, usability and security testing.

Step 8: App Launch

Launch the app to Apple App Store and Google Play Store respectively. Also, ensure you adhere to store guidelines and regulations while strategizing a marketing campaign to promote your app and attract users.

Step 9: Maintenance and Updates

Offer continuous maintenance to keep your app updated in context to address issues, adding new features, and improving performance. Collect user feedback to enhance the overall user experience.

How Much Does It Cost To Develop A Car Rental App?

The modern digital realm facilitates people to rent cars through car rental apps while providing them with both convenience and touchscreen-operated flexibility and control. However, if you are looking to create a car rental app, one of the most critical questions is: What will it cost?

Well, the thing is, there is no uniform price tag when it comes to app development. Developing a car rental app would generally cost between $10,000 and $100,000+, depending on humongous factors like features, functionality, tech stack, team organization, platform selection, and the overall app complexity.

Factors Affecting the Cost of a Car Rental App
Here are the major elements that influence the final cost of your car rental app:

1: Tech Stack

The technology used, such as programming languages, frameworks, and third-party services, directly affects development duration and budget. Native app development using Swift or Kotlin will generally cost more than building apps using cross-platform platforms such as Flutter or React Native.

2: Team Size and Structure

A team comprising developers, designers, QA testers, and project managers will cost more than hiring a small or freelance team. A team with increased size will simultaneously push forward deadlines alongside delivering better quality work.

3: Platform (iOS, Android, or Both)

Developing an app for a single platform is less expensive, while targeting both iOS and Android amplifies development time and expenses. Cross-platform solutions can help reduce this gap.

4: App Complexity

The more advanced the app, such as integrating real-time GPS, dynamic pricing, or AI-based suggestions, the higher the development effort and cost. Simpler apps with core features are quicker and cheaper to build.

5: Location of Development Team

Developer hourly rates vary by region. Hiring developers in North America or Europe is significantly more expensive than in Asia or Eastern Europe, even for the same scope of work.

Recommended Read: Cost to Make a Car Rental App Like Turo

Why Choose Apptunix For Your Car Rental App Development

In car rental app development, Apptunix is the undisputed top preference. Having an experience of over a decade, with a 2,000+ strong digital solutions portfolio, we specialize in developing customized, scalable, and cutting-edge car rental platforms.

Our detailed solutions serve for different models like operator-based rental, peer-to-peer marketplace, and pickup & drop service.

At Apptunix, customization is the core of what we do. Our white-label products are completely customizable, and you can incorporate your own special features and third-party functionalities to suit your business objectives.

Quality without cost is our motto. We provide competitive pricing plans, and you get the best development services within your budget. Our support team is 24/7 available, ensuring round-the-clock support from development to post-launch.

Select Apptunix to revolutionize your car rental business with a secure, easy-to-use, and future-proof mobile app. Work with us to propel your business in the modern digital era.

Finally…

Developing a user-friendly car rental app is no easy feat. “Okay”, you say impatiently, “I understood it”.

Apps are hard to build - “I’m aware.” But why do you sound so impatient… “because after reading your ultimate guide to car rental app development, there are no tips on how to streamline all that stuff!”

That’s a valid point.

I could stay here and share more insights on how you can take baby steps in on-demand car rental app development, but I’ll let our experienced business manager do their job. They’d love to tell you about how effortlessly you can start car rental mobile app development. All you need to do is leave your information.