Car Rentals in Iceland 2015

The development of the car rental industry in Iceland

The increase of tourists in Iceland have tripled since 2003 and with that the amount of car rentals in Iceland. 2003 the number of visitors reached 309.000 visitors and 2014 saw 969.000 tourists coming to Iceland. In 2003 there were 51 Car Rental companies but went up to a staggering 151 in 2014. Ergo, a financial company here believe not all those 151 to be active car rental companies. Some companies are used for example as loan cars at bigger car repair shops. 50 to 60 of these car rental companies have more that 10 cars or over in their car fleet.

Car rental companies in Iceland

The events of 2012 – 2013

The latter part of 2012 the government proposed to exclude VAT for new cars bought for the rental industry. Many rental agencies saw an opportunity to renew the fleet and the new car sales increased like never before. Unfortunately, the proposal didn’t happen fully but a great amount of new cars was bought. When 2013 arrived Iceland saw yet again a huge increase of tourists and when that flood arrived, many car rental companies were already prepared with a fleet of new cars.

The Car Rental scene 2014

If we look back to 2010, it is clear that car rental agencies in Iceland has gone through some struggles but despite those, has grown and multiplied with the increase of tourism. Like many companies in Iceland, they had to deal with the consequences of the 2008 bank crash, changes in the legal environmental and on top of that, the Icelandic nature like volcano eruptions and regular and severe weathers.

Revenues of car rental companies

Most companies depends on the flow of tourism so their revenues is seasonally dependent. Bigger companies are evening out their revenues by long term deals with Icelandic companies and wholesale tourist operators. But the flow of tourism is changing from being almost and exclusive summer season to an all year season which helps smaller companies.

The Icelandic Car Rental fleet

It is estimated that in 2006 there were 4756 car rental cars on the roads of Iceland. In 2014, that number skyrocketed to 12.179.

The Icelandic car rental fleet 2015

If in average, every rental car is driven 25.000 km each year (15534 miles). If we add those numbers together, the rental car fleet drove 305.000.000 in 2014, that’s 189.518.000 miles. To put those numbers in context, that is 230.000 times around Iceland, 7600 around the earth or 400 times back and fourth to the moon. The numbers for 2015 are still not official but it is expected to increase with 15%.

The age of the Icelandic car rental fleet

There are two main features one can read from the age car fleet. 36% of the fleet is is from 2014 or younger. 75% of the fleet is from 2012 or younger and 86% of the fleet is from 2010 or younger. 14% of the fleet is 5 years old or older.

The age of the Icelandic rental car fleet

Rental cars in Iceland has the same legal requirements when it comes safety and condition of the cars as ordinary car fleet. The only exception is rental cars has to be registered as such.

Car makers

The rental car fleet consists of 60 different car makers but when looking closer, many RV are registered twice, once for the car maker and then a second time for the company who built the house of the RV and that confuses the number of different car makers. 4 car makers rule the fleet with over 50% of the cars.

Car types and makers in the Icelandic rental car fleet.

What kind of fuel is used?

The discussion of fuel consumption is an international one and Iceland is not different. While 99.9% of the rental car fleet is cars using either petrol or diesel fuel, the cars has become much more fuel efficient. There are other combinations of fuel use like gases, bio-fuels and electric cars but so far that is only 0.1% of the whole fleet.

Different fuels used in the Icelandic rental car fleet.

Registered new cars from 1999 to 2014

The Icelandic car fleet


Drive safely!  #GoIceland

Source: A report made by Landsbankinn