The demand for rental cars in the early months of this year has seen a significant increase of over 30%, according to market operators. This surge is directly linked to the influx of tourists, which has also grown at a similar rate. Companies in the car rental market have responded to this development by expanding their fleets, improving their quality, and enhancing their communication and sales platforms. However, the devaluation of the Euro has negatively impacted this business, which transacts in euros. Market operators also suggest that there is room for improvement in addressing informality in the sector, Monitor reports.
 |
| A family on a car ready to travel for the holidays (archive) |
Tourism has increasingly become a driving force behind the growth of several supporting industries, including the car rental market.
A conversation with key market operators or a glance at social media platforms like Facebook and Instagram reveals a flood of business pages and individuals focused on car rentals, particularly this year.
Market sources report a trend among small agencies, which own a limited number of vehicles, to rent them out.
Prices vary depending on the type of vehicle and the duration of the rental. For example, a sponsored page online offers a rental car for 25 euros per day, with deals such as one free day if the rental lasts five days, two free days for ten days, and five free days for a twenty-day rental. Another sponsored option offers an SUV for 189 euros for seven days.
These offers are numerous, with some individuals investing in a small fleet of vehicles to capitalize on tourist demand for rental cars, viewing it as an investment opportunity.
However, large companies confirm that the tourism surge has also led to increased informality, creating unfair competition among market players.
**30% Increase in Demand Amidst Euro Devaluation**
The demand for rental cars has noticeably increased this year, nearly parallel with the rise in foreign visitors to the country.
Car rental companies estimate that in the first 4-5 months of 2024, the increase has been at least 30%.
“The first months of 2024 showed a positive trend, expected to rise further with the summer season. We recorded a significant increase in demand, estimated at around 30% compared to 2023,” says Fabio Penzavecchia, administrator of “Sicily by Car.”
However, while demand has risen compared to the previous year and prices have remained relatively stable, the Euro's devaluation has "wiped out" the real growth effect the market is experiencing.
Eliana Bakiri, administrator of “Top Tour,” notes that in the first part of this year, the Euro has reached very low levels against the Lek, at least compared to the same period last year.
“The year, overall, has been good, speaking of the first 4-5 months. The market, in general, has seen increased turnover, with more demand and reservations, but this has not brought significant effects for us, as the Euro has devalued compared to last year.
In the same period in 2023, the exchange rate was better, around 120, whereas today, 1 euro is exchanged for 100 lek. We are registered brokers and sell in euros, which has greatly impacted us,” emphasizes Bakiri.
Companies Invest in Fleet Expansion, Quality Improvement, and Platforms
In Albania, not only has the tourist flow increased year by year, but the categories and origins of tourists have also diversified.
This seems to have prompted companies to remodel their fleets, adapting to these trends, focusing not only on expansion but also on quality improvement.
“In Albania, the region is Mediterranean, and we have found ourselves in the category of economic vehicles, where you can visit every corner of the country with a simple vehicle.
Demand remains for all categories, but we have chosen to operate at low cost, as the luxury segment requires a different marketing approach and has different cost implications,” says Bakiri, confirming that the number of vehicles, especially new ones, has increased again this year for the company.
Others, besides the fleet, have decided to invest in other aspects related to sales formats, communication, or platforms to make the booking process as simple as possible.
“This year, the company, thanks to careful forecasts and proportional adjustment of the fleet with new vehicles, is ready to meet the expected demand. We have a new website that makes the booking phases even easier,” says Penzavecchia.
No Progress in Electric Cars Due to Infrastructure Gaps
As with last year, the expansion of fleets with electric cars has not progressed for rental companies.
They state that their investment plans include this element, provided the necessary infrastructure for charging stations is established in the country.
“For our company, environmental care is of paramount importance. Already in Italy, we are pioneers in green car rentals.
Regarding Albania, we are ready to offer clients a green fleet, which will become part of the market as soon as the necessary infrastructure is deemed sufficient to guarantee vehicle charging throughout Albanian territory,” says Penzavecchia.
Bakiri echoes the same sentiment, stating that with the current situation, electric cars are suitable only for short itineraries.
“Electric vehicles are an option, but in Albania, this is limited by the lack of charging stations.
Someone who rents a car might go as far as Vlora with such a vehicle, but if they want to explore beyond, they cannot take an electric car as a rental.
Transfer cars, those that travel the Airport-Tirana route or go to nearby destinations, can be electric, as they have manageable independence.
However, those taken for longer exploration or itineraries are generally traditional fuel-powered cars,” she emphasizes.
The Energy Regulatory Authority (ERE), in its 2023 annual report, highlighted that investments in this direction are progressing slowly.
“During 2023, according to data, 26 new charging units for electric cars were installed, specifically 2 in Durres with an installed capacity of 250 kW, while in Tirana there are a total of 26 contracts, with an installed capacity of 2565 kW.
Although the total number of electric vehicles has seen steady growth for more than half a decade, many companies and individual consumers are still unaware of how electric cars compare to traditional fuel-powered cars,” noted ERE.