Iceland Mag

3 Reykjavik

Iceland Mag

Economy

Car rental now makes up a larger share of the Icelandic economy than agriculture

By Staff

  • Camper vans vs Cows Agriculture has now been surpassed by car rental. Photo/Vísir

Rental cars have now officially become more important to the Icelandic economy than all the sheep, geothermal greenhouses, and horses combined. According to calculations by Statistics Iceland ,car rental made a larger contribution to the GDP of Iceland in 2017 than agriculture. Statistics Iceland estimates that the total turnover of car rentals was 51 billion ISK (520 million USD/420 million EUR) in 2017, slightly above the contribution of agriculture.

Read more: Price of car rental at Keflavík Airport has dropped by 25% in past two years

The composition of the Icelandic economy has undergone a dramatic transformation in recent years. Ten years ago, prior to the tourism boom, the size of agriculture  was 31.6 billion (320 million USD/260 million EUR). Since then it has grown by 12.2% to nearly 51 billion. During the same period car rental has grown by a staggering 370%, from a relatively insignificant industry generating 7.6 billion ISK (80 million USD/60 million EUR) to more than 51 billion ISK economic powerhouse.

During the same period the fleet of Icelandic rental car companies has grown five-fold. The growth of car rental and self-driving foreign visitors is a major reason for the dramatic increase in traffic on Icelandic roads.

Read more: Record increase in traffic along Ring Road

 

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