The automotive market in 2023, both in Poland and the entire European Union, was a time of rebuilding after the record unfavorable year of 2022, when there were significant problems with the availability of new cars, and their prices were increasing at a very fast pace. Polish car showrooms saw a 13.2% increase in new passenger cars compared to 2022. Double-digit sales growth is encouraging, but it’s also the effect of what’s known as the low base of the previous year. The total number of cars sold in our country in 2023 was still much lower than in the years before the economic crisis and automotive market downturn caused by the Covid-19 pandemic and semiconductor supply disruptions. However, there is no doubt that the market is gradually rebuilding and returning to “normality” – new cars are now available for most brands without any problems, the increase in vehicle prices is slowly decelerating, and discounts on car purchases are once again available. According to data published by PZWLP, the long-term rental market maintained a solid pace of development, which reached 9% year-on-year in 2023. It’s worth noting that every fourth new passenger car purchased last year by companies and entrepreneurs in Poland was found in long-term rental. The Rent a Car market also recorded a high growth dynamic, increasing by 12.3% year-on-year.
The double-digit pace of growth in new car sales was maintained throughout the past year, and the automotive market was rebuilding after the record difficult year of 2022, when the automotive industry had to deal with several unprecedented problems at once. The supply crisis, i.e., the lack of availability of new cars or extended waiting times for vehicle delivery, combined with a very dynamic increase in car prices, posed significant challenges to the market. In 2022, the sale of new passenger cars in Poland was even lower than the pandemic-filled, lockdown year of 2020 (419 thousand cars in 2022 vs. 428 thousand cars in 2020).
The improvement in car availability in 2023 could not lead to anything other than a rebound from the historical low, and consequently, to impressive sales increases, especially when compared year-on-year.
Automotive Market Rebuilds After Supply Crisis – Still Far From Sales Volumes of Previous Years
In 2023, a total of 475,000 new passenger cars left Polish car showrooms, 13.2% more than in 2022. The growth rate is excellent, but it’s largely the effect of the low base. The sales volume was still much lower than what was achieved before the economic crisis. For comparison, in 2019, the total sale of new cars in Poland was over 555,000, and in 2018, it was not much less, at 532,000. The growth in sales of new cars in our country was similar to that recorded across the EU.
For many years, the majority of new cars sold in showrooms in Poland were bought by corporate clients, who purchased nearly ¾ (72.5%) of the vehicles.
A positive phenomenon worth noting in 2023 is the relatively low level of used car imports from abroad. A total of 737,000 used cars were imported into Poland last year. Compared to the years before the crisis (2019 and earlier), this number is not large, as several years ago, our country imported even over 900,000 used cars annually. The size of the import in 2023 was indeed larger than the year before (by 4.4% year-on-year), but the pace of this growth was significantly smaller than the growth in sales of new cars. It’s important to remember that imports are mainly accounted for by individual customers and according to IBRM Samar data, last year in this group of customers, interest grew faster (sales growth) in purchasing new cars than in used ones imported from abroad.
Long-term Rental Stands Out in the Market – Stable Sales Growth Without the Effect of Low Base
The pillar of new car sales in Poland in 2023 were companies and entrepreneurs, and in their case, the sales growth dynamics were the highest, reaching 15.5% year-on-year. Similar to the entire automotive market, such high growth is the effect of the low base of 2022. Moreover, the pace of sales growth in various forms of car financing to companies significantly differed and was closely related to the level of sales in 2022, in other words, it was greater, the more a particular financing type suffered from the supply crisis. As a result, the highest sales growth dynamics of new cars, at 20.8% year-on-year, were recorded for purchases from own funds, credit, and traditional leasing combined. It’s worth noting that in these financing forms, the previous year (2022) saw the highest sales decline at -14% year-on-year.
The situation was completely different for long-term rental cars, which even in difficult economic times are characterized by relatively high resilience to external economic factors in Poland and maintain a stable (and continuously growing) level of sales, not subject to large fluctuations.
In 2023, sales in long-term rental in Poland grew by 1.9% year-on-year, and importantly, the comparative base of 2022, unlike the rest of the market and competitive financing types, was not low in this case. Unlike the entire automotive market and competitive solutions, in 2022, i.e., the period of record slowdown in the automotive industry, long-term rental in our country also recorded a sales growth of 2.3% year-on-year, distinguishing it from the market.
In long-term rental, every fourth (24.8%) new passenger car purchased by companies and entrepreneurs in Poland last year was included, meaning the industry purchased a total of 85.5 thousand cars for the services offered.
Uninterrupted High Growth Rate for 2 Years
Published data by PZWLP confirms that the long-term car rental market in Poland has been developing at a high pace for several years. In terms of the most important indicator for this industry, i.e., the total number of cars, the long-term rental market recorded a 9% year-on-year growth in 2023.
The Dynamics of Growth in the Long-term Car Rental Market in Poland Have Been Maintaining a Good, Stable Level for Years, Fluctuating Around 9% Over the Last Two Years, says Robert Antczak, President of the PZWLP Board. – It is worth emphasizing that this was indeed a very difficult time for the entire economy, including the automotive market, which struggled with unprecedented, unfavorable phenomena such as reduced supply of new cars or significant increases in vehicle prices. The long-term rental industry stands out very clearly against this background from the rest of the automotive market and competitive forms of financing. The number of cars in the Polish market in long-term rental is consistently and rapidly increasing, one could say, regardless of macroeconomic factors. This service is becoming an increasingly important part of the automotive market in our country, becoming one of the most important forms of car financing. Just a decade ago, awareness of long-term rental in Poland was not large, it was mainly used by large corporations. Today, long-term rental is increasingly being utilized even among the smallest entrepreneurs in Poland, who are becoming a larger group of customers in our industry.
Diesels in Retreat, Rapid Growth in Share of Cars with Ecological Drives
PZWLP data at the end of 2023 unequivocally indicate that the ecological transformation of drives used in cars in long-term rental is progressing very quickly. Once dominantly diesel engines, by the end of the year, constituted only 1/3 of vehicles (34%), and their share in the total fleet decreased over one year by 5.3 percentage points. The majority, at 54.7%, are cars powered by gasoline engines, whose percentage increased over the year by 1.7 percentage points. On the one hand, an interesting fact, and on the other, tangible evidence of the rapid transformation of drives, is the largest increase in the share of the total fleet in long-term rental of cars equipped with ecological drive units, i.e., all types of hybrids and fully electric cars. The percentage of such vehicles increased over the year by 3.6 percentage points and now constitute 11.3% of the total. Moreover, fully electric cars (BEV) constituted 2.3% of the total fleet at the end of December 2023, and their share nearly doubled over the year (from 1.2% at the end of 2022). The rapid growth in the share of electric cars is primarily the result of the government subsidy program “My Electric”, but also falling prices for this type of cars and the increasingly well-developed infrastructure for charging electric cars in our country.
The average CO2 emissions of new passenger cars purchased by the long-term rental industry in the fourth quarter of 2023 were 7% and 9.7 g/km lower than the previous year, amounting to 128.2 g/km. As for commercial vehicles, the average emission in their case was 131.2 g/km and was lower by 2.7% and 3.7 g/km compared to the same period in 2022.
At the end of 2023, the fleet of PZWLP companies in long-term rental, totaling nearly 266,000 cars, included the most popular and numerous cars such as Skoda Octavia, Toyota Corolla, Volkswagen Golf, and Hyundai i30.
Rent a Car Industry Accelerates – 12.3% Growth in 2023
PZWLP data at the end of 2023 indicate the growing dynamics of development of the Rent a Car market (car rental) in Poland. At the end of the fourth quarter of last year, the growth rate of the Rent a Car industry was 12.3% year-on-year, meaning it has been growing for the second quarter in a row and is currently the highest in a year and a half.
2023 was not an easy period for the car rental industry, which struggled with a decline in demand. This decline was a result of inflation and the overall economic situation, negatively affecting both individual and business customers – explains Paweł Piórkowski, Member of the PZWLP Board. – After about a year of slower development, however, we are observing positive changes. The increasing dynamics of growth for two consecutive quarters, reaching double-digit values, is a promising signal. It may mean that the most difficult time, caused by economic disruptions, is behind us. Although it is still too early for a definitive forecast of improvement in 2024, everything indicates that the car rental industry may again experience faster growth.
The Rent a Car industry is currently represented in PZWLP by 8 large, networked, Polish and international car rental companies, whose total fleet* in short-term rental (1-30 days) and medium-term rental (1 month – 2 years) services amounted to almost 21 thousand cars at the end of December 2023.
– excluding the fleet of Avis Budget / Jupol – Car and Sixt Rent a Car Poland / Eurorent Sp. z o.o.
