How Can Vehicle Rental Businesses Make More Profit During the Holiday Season? 5 Proven Strategies
- Dec 12, 2024
- 5 min read
TL;DR:
Holiday seasons can deliver some of the highest-margin bookings of the year for vehicle rental businesses, but only with the right preparation. Five strategies consistently deliver: bundled holiday packages, a holiday-ready digital booking experience, telematics-driven fleet readiness, dynamic pricing tuned to peak demand, and cross-promotional partnerships with local businesses. Together they protect margin while capturing the seasonal demand surge.
Intro
Christmas Eve, 4pm. The phone has not stopped for three hours. A customer wants to know if they can extend their hire by two days. A family is at the counter wondering why the booking they made online does not show in the system. The last spare keys are sitting on the wrong desk. Three vehicles are still on the forecourt waiting to be cleaned, and the next pickup is in twenty minutes.
Every operator who has worked a peak season knows that scene. The holiday period is where rental businesses make some of their best margin of the year. It is also where the gap between a prepared operation and an unprepared one shows up most painfully. The businesses that come out of the December or summer rush in good shape have usually done the same handful of things in October. The ones that limp through January, fixing damage disputes and chasing unpaid bookings, have not.
The opportunity is real. Tourism-driven vehicle rental sits at the centre of holiday travel demand, and the online segment held around 76% of the tourism vehicle rental market in 2023, with that share continuing to grow. Customers booking holiday hires today expect the same experience they get from booking flights or hotels: real-time availability, instant confirmation, transparent pricing and a smooth pick-up.
The five strategies below are the ones that consistently separate a profitable holiday season from a chaotic one. None of them are clever or new. What matters is whether the business does them with intent before the surge hits, or scrambles to do them once it has already started. Here is what they are, and how to put each into practice.
The holiday season brings a surge in demand for rental vehicles, making it the perfect opportunity to maximise profits. Whether you specialise in car hire for travellers or van rentals for holiday movers, these five innovative strategies will help your rental business thrive this festive season.
1. Offer Holiday-Specific Packages
A recent survey revealed that 85% of customers are willing to pay extra for bundled services. Create tailored rental packages that appeal to holiday travellers and seasonal needs. For instance, bundle features like GPS navigation, child seats, or winter tires at discounted rates. Include flexible return options or multi-city drop-offs for travellers visiting family. Highlight these packages prominently on your vehicle booking platform and social media channels. Customers value convenience and customised offers can set your business apart, encouraging upselling and higher booking volumes.
Tip: Highlight "book early" discounts to incentivise advance reservations and manage fleet utilisation more effectively.
2. Enhance Your Digital Presence
Ensure your website and booking app are optimised for the holiday season. In 2023, 76% of car rental bookings were made online. Update visuals with festive themes and emphasise your best offers. A user-friendly vehicle rental booking software interface that supports instant booking and secure payment options will improve conversions. Invest in holiday-specific search engine ads and use geo-targeting to attract travellers arriving at nearby airports or transit hubs.
Pro Tip: Check out this social media starter kit and SEO starter kit which is specifically designed for mobility companies to enhance your digital presence.
3. Optimise Fleet Availability with Telematics
Integrate telematics into your car rental fleet management solutions to ensure your vehicles are always ready for the road. Use automated fleet scheduling to allocate vehicles efficiently and avoid overbooking. Additionally, monitor vehicle health and maintenance schedules to prevent downtime during peak demand. A well-managed vehicle rental management system ensures you can cater to more customers without compromising on service quality.
4. Leverage Dynamic Pricing for Increased Revenue
Dynamic pricing enables rental businesses to adjust rates based on real-time factors like demand, customer type, and location. With Coastr’s vehicle rental management system, you can implement flexible pricing rules to maximise revenue.
Set Dynamic Pricing Rules Based On:
Time: Adjust for peak/off-peak hours or day/night rates.
Demand: Increase rates during high-traffic periods.
Customer Loyalty: Offer discounts to repeat customers while charging premiums for one-time renters.
Market Trends: Monitor and adapt to seasonal pricing.
Location: Apply surcharges for airport pickups/drop-offs.
Seasonal Demand: Charge premium rates during holidays to maximise profits.
Dynamic pricing ensures that your rates remain competitive while optimising revenue across all segments.
5. Collaborate with Local Businesses
Partner with hotels, travel agencies, and local attractions to create cross-promotional offers. For example, offer discounts for customers renting a car to visit specific tourist spots or staying at partner hotels. Cross-promotions help expand your reach and attract new customers, particularly holidaymakers looking for seamless travel solutions.
Tip: Use your booking platform to showcase these partnerships and enable easy bookings for bundled offers.
FAQs
How can vehicle rental businesses make more profit during the holiday season?
The most effective holiday strategies are bundled packages with add-ons like GPS or child seats, a polished online booking experience, telematics to keep the fleet road-ready, dynamic pricing to capture peak-demand margin, and cross-promotional partnerships with hotels and travel agencies. Operators who plan these strategies six to eight weeks before peak demand consistently outperform those who react once the season has started.
Why does dynamic pricing matter most during the holiday season?
Holiday demand is the most extreme demand pattern of the year. Fixed pricing either undercharges during peak weekends, leaving margin on the table, or overcharges during the lull around the festive period, losing bookings. Dynamic pricing automatically adjusts rates by demand, day, location and customer type, so the business captures premium rates during peaks and protects volume during dips.
How important is online booking during holiday peak seasons?
Online booking is now the dominant channel for holiday rentals. Around 76% of tourism vehicle rental bookings happen online, and that share is still growing. Customers planning trips compare options on mobile devices, often outside business hours, and abandon any operator without instant confirmation. A holiday-ready booking site with real-time availability and secure payment is no longer optional for capturing seasonal demand.
Should car rental businesses offer bundled packages during holidays?
Yes. Bundled packages such as a car plus GPS plus child seat, or a multi-day rental with discounted insurance, deliver three benefits at once: higher average order value, easier purchase decisions for the customer, and a stronger reason to book direct instead of through aggregators. Highlighting bundles prominently in booking flows typically lifts add-on revenue per booking significantly during peak seasons.
How can rental businesses prepare their fleet for the holiday rush?
Preparation starts six to eight weeks out. Schedule all routine maintenance well before peak demand, audit fleet readiness using telematics data, plan staff rotas around expected booking volume, set buffer vehicles aside for last-minute demand, and confirm all customer documentation processes are digital. A fleet that breaks down on Christmas Eve loses three bookings, not one.
How do partnerships with local businesses help holiday rental sales?
