Morocco’s Car Rental Industry Slumps Despite Tourism Boom

For a summer season whose tourism figures exceeded all expectations, car rental companies are gloomy.

Even though everything was in place for a fruitful season, the sector has been crawling. According to L’Economiste, "some operators affiliated with the Federation of Automobile Rental Companies without Drivers have even made vehicle purchases, an increase of 8% of the fleet at the end of August."

The newspaper cites the figure of 4 million Moroccans Residing Abroad (MREs) for this summer season, an 8% increase compared to the first seven months of 2019. An increase in arrivals that unfortunately did not have a positive impact on the tourism chain due to the informal sector.

Indeed, the newspaper notes that car rental companies, located on the outskirts of major cities, target tourists through sometimes unconventional but effective methods, such as prospecting clients upon their arrival at airports.

A good part of them, with a brand new fleet, operate in the informal sector. A cause of the decline in activity recorded by the formal market, according to professionals.

The daily writes that car rental companies are counting on the 2020 Finance Bill to have certain facilities such as the reduction of the straight-line depreciation period from 5 to 3 years as an option, given that the acquisition of a vehicle is not an investment like any other.

The Federation also believes that the professional tax scale "penalizes investment". Added to this is a 10% VAT instead of 20% as for other tourism sectors and a 17.5% IS due to the predominance of foreign currency turnover.