Car rental demand stagnates ahead of Eid holiday, with some regions experiencing growth

Jakarta - Erwin Suryana, chairman of the Association of Regional Car Rental Entrepreneurs (Asperda), has revealed that car rental demand ahead of the Eid holiday travel period this year is showing minimal significant national growth. Most rental operators are reporting declining demand compared to the previous year, although certain regions continue to experience relatively strong demand increases.

“The majority of Asperda members, approximately 50 per cent, report that vehicle rental demand during the Eid travel period shows no increase,” Suryana said when contacted from Jakarta on Friday.

He added that around 30 per cent of members are experiencing demand declines, with only approximately 20 per cent reporting increases compared to the previous year.

“Overall, demand conditions are lower than the average demand growth during previous Eid periods,” said the chairman of the association, which has approximately 1,000 vehicle rental business members.

Suryana identified several factors contributing to the decline in vehicle rental demand. One key factor is weakened consumer purchasing power and a tendency to curtail spending.

“Declining purchasing power, a tendency to hold back spending. Consumers are inclined to purchase only essential items and are restraining expenditure on tertiary needs such as car rentals and tourism travel,” he said.

He also noted the impact of employment terminations, which appear to be influencing consumer spending patterns.

“The impact of layoffs also seems to be a factor,” he added.

However, certain regions are demonstrating different demand dynamics. One such area is Malang, East Java.

Rizki, field coordinator and tour planner at Srigading Trans, a car rental service provider in the Jalan Bunga Srigading area in Lowokwaru, Malang, stated that car rental demand in his region is actually experiencing significant growth ahead of the Eid holiday.

According to him, most customers are using rental vehicles for family visiting during Eid celebrations and for tourism in East Java regions, such as Batu City, Mount Bromo, Tumpak Sewu Waterfall, and Ijen Crater.

Consistent with Asperda’s observations, family vehicles or multi-purpose vehicles (MPVs) remain the primary customer choice, such as Avanza and Ertiga models.

With increasing demand during the travel period, rental companies are adjusting their tariffs accordingly.

“There will definitely be increases, nearly 50 per cent price increases from the standard rate, typically from seven days before to seven days after the holiday,” Rizki said.