Car Rental Outlook 2025: The Road Ahead

The Changing Car Rental Industry: Challenges and Opportunities

The U.S. car rental industry is going through an important shift. After years of fast growth following the pandemic, the market is now stabilizing. In 2024, industry revenue reached $37.9 billion, slightly lower than in 2023, record breaking year at $38.4 billion, due to flat demand, higher vehicle depreciation costs, and pricing pressures​. For 2025, demand is expected to increase slightly but not exponentially until the beginning of 2026. While rental companies continue to play a key role in travel and transportation, they must find new ways to stay profitable in a more competitive market.

Some positive signs include improved fleet availability and a return to pre-pandemic business travel levels. However, companies still face big challenges, including rising costs to buy and maintain vehicles, changing customer expectations, and major staffing shortages.

A Market in Transition

Managing fleets efficiently is still the core of the car rental business. The largest companies, including Enterprise, Avis Budget, and Hertz, operate over 2.1 million vehicles across more than 11,000 locations in the U.S​. but vehicle supply issues and unpredictable resale values are making it harder to stay profitable. Companies must now focus on making the best use of their fleets and improving their workforce strategies to reduce costs in major and meaningful ways to accompany their fleet acquisition cycles and vehicle remarketing strategies considering 75% of the business is now tied to that.

At the same time, customer service is more important than ever. While technology like self-check-in has made rentals faster, relying too much on digital tools has caused a 12 percent drop in customer satisfaction​. Customers still want personal service, quick solutions, and an easy rental experience. The most successful companies will be the ones that mix automation with human service in a way that makes customers happy.

The high employee turnover rate of over 80 percent and rising labor costs, up 6 percent each year, mean rental companies must rethink how they manage staff. Instead of simply raising wages, they need an on-demand workforce solution that ensures the right people are in the right roles at the right time. That is where EDS Service Solutions comes in. We bridge the gap between technology and human expertise, creating cost effective workforce management models that find the right talent for the right roles at the right time, from backend support such as Vehicle Service Agents and Transporters, to customer facing positions such as Return Agents, Exit Gate Agents and Counter Agents. At EDS, we do not just provide staff, we become an extension of our Car Rental Partners’ teams, embracing their goals and values to help them succeed, ensuring that every employee shares our commitment to operational excellence, innovation, and a customer-centric approach. We empower excellence in every workforce while we meet your goals.

The Industry’s Biggest Challenges and the Need for a Smarter Approach

• Skyrocketing Fleet Costs & Utilization Pressures
  The financial strain of vehicle acquisition and maintenance is at an all-time high. Manufacturers are prioritizing high-margin retail sales, limiting rental fleets’ access to new inventory, while depreciation costs remain unpredictable. To protect profit margins, companies must optimize high vehicle utilization rates, which is impossible without a reliable, well-trained workforce that ensures quick turnarounds and seamless operations.
• Customer Experience: The Defining Trend of 2025
  This year, customer service is the competitive battleground. While automation, such as self-check-ins and AI-driven pricing, has improved operational efficiency, it has also introduced friction. In fact, rental companies that rely too heavily on digital-only interactions have seen a 12% decline in customer satisfaction. Consumers still expect personalized service, fast resolutions, and an effortless rental experience. The key to winning in 2025 is blending automation with human interaction, ensuring that every touchpoint strengthens customer loyalty.
• Workforce Challenges: High Turnover, Rising Costs, & Labor Shortages
  The industry faces an 80%+ employee turnover rate leaving many locations understaffed and struggling to deliver consistent service levels. With labor costs climbing 6% year over year, simply increasing wages is not a sustainable solution. The answer lies in workforce agility, deploying the right talent, at the right time, in the right roles.

The future of car rental belongs to companies who can balance automation with human expertise, scalability with service quality, and cost control with customer satisfaction. EDS Service Solutions is the workforce partner that makes this possible, delivering staffing solutions that drive profitability, operational excellence and an unmatched customer experience.

The EDS Proprietary Advantage: This is how we do it

At EDS Service Solutions, we go beyond traditional staffing by integrating proprietary technology with human expertise to enhance the entire labor funnel, from talent acquisition to workforce optimization. Our data-driven approach ensures that car rental companies receive the right talent at the right time, optimizing operational efficiency and elevating customer experience while reducing costs.

1. Smarter Talent Acquisition and Rapid Deployment: Tech-Driven, Human-Curated Hiring

Finding and hiring top-tier car rental talent is one of the industry’s biggest challenges. EDS solves this with a hybrid approach that combines cutting-edge automation, human recruiting expertise, and rapid workforce deployment to ensure car rental companies receive the right talent at the right time.

• Optimized Application Process Our proprietary platform streamlines the candidate experience, making it easier for job seekers to apply, complete pre-screenings including comprehensive background checks, while shortening turnaround times to a few minutes.
• Human Expertise We pride ourselves on having the most professional and robust recruiting team in the country and across industries. Our specialized recruiters take a high-touch approach, ensuring that we identify the best talent for the right roles with extreme care, leading to higher retention rates for long-term success.
• Data-Driven Insights We leverage analytics to assess labor market conditions and approach them with the right strategy.
• Intelligent Scheduling and Rapid Placement Our technology matches candidate availability with operational needs in real time, drastically reducing downtime and filling critical roles more efficiently.
• Seamless Team Integration With a structured onboarding process, EDS ensures new hires are ready to perform from day one, reducing training time and maximizing productivity.

2. Predictive Workforce Management: Optimizing Staffing and Cost Efficiency

Our technology doesn’t stop at hiring; it enhances day-to-day car rental operations. Our proprietary workforce management software forecasts staffing needs, ensuring car rental companies maintain ideal workforce levels, minimizing excess labor costs, while maintaining a full Ready Line.

• Predictive Staffing Models Our tech-driven system analyzes rental demand, seasonal fluctuations, and airport traffic patterns to recommend optimal staffing levels in real time.
• Dynamic Scheduling Optimization Car rental locations get the right number of staff exactly when they need them, eliminating overstaffing or understaffing issues.
• Cost Reduction and Efficiency Gains By predicting demand, our system reduces labor waste, overtime costs, and turnover, leading to higher profitability without sacrificing service quality.
• Real-Time Performance Tracking EDS can monitor attendance and productivity to fine-tune workforce performance, ultimately elevating the customer experience.

Why EDS? A Future-Proof Workforce Solution

By combining technology with human expertise, EDS Service Solutions empowers car rental companies to stay ahead of labor challenges while delivering seamless, personalized customer experiences. Our proprietary workforce management platform isn’t just about staffing, it’s about creating a smarter, more agile, and cost-effective car rental workforce.

Partner with EDS to master workforce agility and drive the future of car rentals in 2025 and beyond.