How to set up a Car Rental Business in Dubai?

Car rental Businesses are fuelling Dubai’s economic growth. Without a private car, it is almost difficult to explore the United Arab Emirates (UAE). Automobile rental is a frequent form of transportation for UAE residents, as well as tourists, businesses, and other visitors and guests.

Due to the fact that Dubai and the United Arab Emirates have one of the world’s greatest road networks, driving around the emirate is uncomplicated and stress-free.

How to start car rental company in dubai

According to data released by Industry Research, “The Internet Car Rental market is anticipated to rise at a considerable rate during the forecast period, between 2022 and 2028. In 2022, the market is growing at a steady rate and with the rising adoption of strategies by key players, the market is expected to rise over the projected horizon.”

It should not come as a surprise that tourists and business travelers continue to account for the majority of Dubai’s rental car customers. Nonetheless, a growing number of Dubai residents, whether they are Emiratis or foreigners, are electing to rent vehicles rather than owning their own so that they may use one just when they need it.

This article will educate you on the advantages & benefits of starting a car rental business in Dubai, the initial costs associated with establishing your own car rental business, and the steps necessary to establish a vehicle rental business in the United Arab Emirates.

Benefits of Starting a Car Rental Business in Dubai

Starting car rental company in dubai

People often migrate to Dubai in the hopes of improving their economic status. If you are an entrepreneur interested in launching a profitable business, the automobile rental market is a good option to investigate. No one will ever stand in your way, regardless of whether there are already well-established rental firms in Dubai, such as Hertz, Dollar, and others, or if you create a little company or a huge rental market.

Even though a significant rental fleet is maintained by a number of rental companies in Dubai, there is always a demand for more rental vehicles. You cannot tour and visit every section of Dubai utilizing public transportation, which is one of the fundamental reasons why public transit is inadequate.

Here’s why you should consider starting a car rental business in Dubai:

1. Tourism

Every year, millions of tourists go to Dubai to see the emirate’s magnificent architecture, historical and religious structures, beaches, and restaurants. Due to Dubai’s role as a gateway to the rest of the United Arab Emirates, many tourists who arrive in the country will be interested in finding a location to hire a car in order to go across the rest of the UAE. In the upcoming years, there will undoubtedly be a substantial demand for the services supplied by your Dubai car rental business.

2. New Preferences

Due to the spread of influenza, people are often more afraid to utilize public transit than they were before the epidemic. It is also becoming more common for non-car owners to rent a vehicle for trips rather than own one. They are able to go across Dubai without sharing public transit or incurring the costs of acquiring their own vehicle since they rented a car instead of purchasing one.

3. Technology

You will be able to take advantage of growing technology if you establish a car rental business in Dubai, which is another advantage of doing so. As a result of the spread of cell phones, applications, and GPS technology, anyone may now pick up and return rental cars with more ease than ever before. Consequently, there is a larger probability that people will rent autos in the future, since finding and hiring a vehicle is now much simpler than it was in the past.

4. Convenient Form of Transportation

Renting a car in Dubai is a wonderful option for people who want maximum comfort and convenience. Using public transit is far less convenient than renting a car. Even though you won’t have a driver as you would in a taxi, renting a car is still an excellent alternative since the majority of them have GPS systems. Due to the situation of the economy, an increasing number of consumers are opting to rent autos, which is beneficial for any rent-a-car business.

5. Deciding your location

In order to begin a profitable car rental business in Dubai, you will need to purchase physical facilities, such as an office and a parking lot or garage for storing your fleet of cars. This should ideally occur in a metropolitan region or at a significant transit hub, such as a train station or airport. 

You have the choice of establishing your company on the UAE’s mainland or in one of the country’s several free zones. Keep in mind that in order to deal directly with the UAE market, you must either open a branch in the UAE or operate via a distributor, despite the fact that establishing a business in a free zone is often less costly.

6. Structuring Your Business Activities

When starting a business in the United Arab Emirates (UAE), it is necessary to offer a comprehensive description of the activities that will be conducted. Failure to do so might lead to complications in the future, since participating in activities that need a license can result in fines or even the termination of the license.

Your activities must be chosen from the Department of Economic Development in Dubai’s official list (DED). “Car rental and passenger transport” is the official DED activity that must be chosen in order to begin a vehicle rental business.

7. Choosing the Right Name

The third step, choosing a name for the organization, is also quite important. At this stage, it is vital to bear in mind a few basic facts, many of which are not applicable in other regions of the world.

Be advised that you are required to conform to a severe set of naming criteria. In a nutshell, you should avoid any language that may be deemed disrespectful or obscene. Avoid utilizing acronyms and well-known company and organization names.

8. Making your License Application

A valid commercial license is required to operate a car rental business in Dubai and the rest of the United Arab Emirates.

When applying for a license, you will be required to give the following items:

  • An application form that has been completed
  • Passport copies of the owner(s) or owners are necessary.
  • Visa Copy
  • Copy of Your Ejari
  • NOC from sponsor
  • Undertaking from RTA

In addition to having a valid business license, you must also get approval from the Road Traffic Authority (RTA). It is probable that your staff will also be required to take RTA training.

9. Applying For Visa

Furthermore, if you do not already have one, you will require a visa to work in the United Arab Emirates. To restate, obtaining the proper information may make the visa application process quite straightforward. In addition to supporting you with the application for your license, the majority of company formation firms, such as Airzone, may also assist you with this step.

10. Opening bank account

When done with everything above, go ahead and open your bank account so you can receive payments and carry out your business transactions.

Car Rental Business in UAE: Cost

When considering how to create a car rental business in Dubai, one of the things you must do before beginning operations is to consider the associated costs. In your calculations, you will need to consider the expenses of your company license, your premises, the RTA authorizations, and your fleet of vehicles.

If you apply for a business auto loan, a business loan, business insurance, and a rental contract, you will have a better sense of the expenses connected with running a vehicle rental company in Dubai after you have included those costs into your business plan and applied for those loans. If you want to get a Commercial Mainland trade license, the initial beginning costs for your firm will range from 15,000 to 20,000 AED.

Is Car Rental Business Profitable in Dubai?

The UAE rental market is very competitive and profitable. Establishing a successful vehicle rental business in Dubai requires the creation of an adequate business strategy, the selection of a suitable site for a parking lot, and the implementation of marketing initiatives.

These are the essential components of a successful automobile rental company setup in Dubai. There is an increasing tendency among tourists to Dubai to hire automobiles instead of utilizing public transit to go about the city. Consequently, starting this kind of business in the UAE is among the options given the greatest attention.

Despite being a relatively small city, Dubai is a significant financial hub. There is a lengthy variety of convincing reasons why Dubai is the best site for starting a vehicle rental company, including the city’s luxurious splendor, cutting-edge amenities, ancient allure, and large tourist population. Dubai is the ideal location to launch a vehicle rental company.

How Airzone can help you to Start a Car Rental Business in UAE?

Airzone provides the most up-to-date and accurate information about starting a vehicle rental company from industry specialists who deal with it every day.

At Airzone, we’re committed to providing you with the best options for starting a UAE-based business. You receive quick, trustworthy, and impartial help with your individual company setup needs. We can guide you through the whole licensing procedure, from beginning to end, and help you choose the appropriate license for the business activity or activities you wish to pursue.

To assist you in creating a bank account for your business, we can also provide you with information on the appropriate financial institution for your needs.

You can concentrate on running your business while we handle the tedious task of incorporating a corporation for you. Choosing to work with us ensures that you will get the most cost-effective and budget-friendly solution to help you easily establish a business in the UAE.

Conclusion

Dubai is one of the world’s most vibrant cities. Setting up a car rental business in Dubai is a great way to get into the transportation industry. 

There are some things you need to do before you can start your business. The licensing process for a car rental company is relatively simple and can be done online. 

Once your license is approved, you will need to set up your office and hire employees. You will also need to purchase or lease cars for your fleet. 

Marketing your car rental business in Dubai can be done through online channels and traditional marketing methods such as print media and billboards.

If you want to learn more about how to set up a business in Dubai, we have a comprehensive guide for you. With an in-depth overview of the UAE’s business landscape, you should be well aware of how to set up a business in the country.