Rental-car firms add in-city sites
Rental-car firms add in-city sites
By JIM SUHR
The Associated Press
ST. LOUIS — It’s part of an intensifying car rental rumble: As Enterprise Rent-A-Car increases its visibility at airports, longtime airport leader Hertz is muscling into America’s neighborhoods, Enterprise’s closely guarded turf.
Over the past three years, Hertz has christened more than 800 away-from-airport sites — including two in Columbia — to push its total to 1,100. The company hopes to add 200 more before the end of this year.
New car-rental sites are sprouting as Hertz and other Enterprise rivals eye off-airport sites, hoping to reduce their dependence on an air travel industry that has struggled since the September 2001 terrorist attacks. Such woes contributed to the bankruptcies of Alamo, National and Budget car rental companies, which since have regained their footing.
Enterprise, the nation’s largest rental-car company, is responding in kind, seeking more counter space at the airports. It has opened 27 airport outlets in the latest fiscal year, bringing its total in recent years to 170, including at every major U.S. airport. It does not have a site at the Columbia airport.
“It’s open season. It’s capitalism. There’s plenty of business out there,” said Neil Abrams, whose New York-based consulting group has a market research unit that monitors businesses including the rental-car industry.
According to Abrams Travel Data Services, car-rental companies will generate $18 billion in revenue nationwide this year. About 40 percent of that business will be away from airports, explaining the new focus on car rentals in neighborhoods and suburbs.
Enterprise has more than 6,000 locations worldwide — 5,400 of them in the United States — and on average has been opening a new branch every business day. Its response to the mounting challenge: Bring it on.
“Why is everyone running to the nonairport market that we cultivated? What other choice do they have?” said Christy Conrad, spokeswoman for St. Louis-based Enterprise, which became the nation’s biggest rental-car company mostly on the strength of its neighborhood rental shops that provide temporary replacements while cars are being repaired.
“This isn’t the first time we’ve seen the competition in our market. It happens in cycles; competition comes and goes,” she said. “We really do a better job when the competition is there. It keeps us on our toes.”
The privately owned Enterprise, which boasts it has sites within 15 miles of 90 percent of the U.S. population, has been the 800-pound gorilla in the local and replacement market, thanks to its deals with major insurers, large auto dealers and automotive-service companies.
Such neighborhood dominance, observers say, has given Enterprise relative stability and made it more recession-proof than other rental companies more reliant on air travelers. In good times and bad, car wrecks happen, and people need rentals.
“There aren’t too many industries you can think about where there’s such a major domination in one marketplace,” Abrams said of Enterprise.
Hertz hopes to chip away at that, seeking growth beyond its comfort zone of airports, where it enjoys a 30 percent market share. By stepping into suburbia, Hertz, owned by Ford Motor Co., sees the lucrative insurance-replacement market as a “very promising niche,” spokeswoman Paula Stifter said.
“In (that) arena, body shops and insurance companies are welcoming the choice,” she said. Stifter said Hertz has about 7,200 outlets worldwide, though she declined to specify the number in the United States.
Meanwhile, the Cendant Car Rental Group — which bought Budget out of bankruptcy in 2002 and also operates Avis — also has taken to the neighborhoods. In August statements trumpeting its opening of 15 new car-rental sites in the West and Midwest, Avis cast the growth “as part of its commitment to expand into local markets nationwide.”
Nationwide, Avis has about 1,000 outlets and Budget roughly 950, with each having about 700 of those sites away from airports, Cendant Car Rental Group spokesman Ted Deutsch says.
“It’s a sector of the market with the greatest growth potential,” he said for a company that globally has about 1,850 Budget outlets and 1,750 Avis ones. Away from airports, “we’re not just looking to put stores there just to say we’re there. We’re looking for good, solid conditions.”
By JIM SUHR
The Associated Press
ST. LOUIS — It’s part of an intensifying car rental rumble: As Enterprise Rent-A-Car increases its visibility at airports, longtime airport leader Hertz is muscling into America’s neighborhoods, Enterprise’s closely guarded turf.
Over the past three years, Hertz has christened more than 800 away-from-airport sites — including two in Columbia — to push its total to 1,100. The company hopes to add 200 more before the end of this year.
New car-rental sites are sprouting as Hertz and other Enterprise rivals eye off-airport sites, hoping to reduce their dependence on an air travel industry that has struggled since the September 2001 terrorist attacks. Such woes contributed to the bankruptcies of Alamo, National and Budget car rental companies, which since have regained their footing.
Enterprise, the nation’s largest rental-car company, is responding in kind, seeking more counter space at the airports. It has opened 27 airport outlets in the latest fiscal year, bringing its total in recent years to 170, including at every major U.S. airport. It does not have a site at the Columbia airport.
“It’s open season. It’s capitalism. There’s plenty of business out there,” said Neil Abrams, whose New York-based consulting group has a market research unit that monitors businesses including the rental-car industry.
According to Abrams Travel Data Services, car-rental companies will generate $18 billion in revenue nationwide this year. About 40 percent of that business will be away from airports, explaining the new focus on car rentals in neighborhoods and suburbs.
Enterprise has more than 6,000 locations worldwide — 5,400 of them in the United States — and on average has been opening a new branch every business day. Its response to the mounting challenge: Bring it on.
“Why is everyone running to the nonairport market that we cultivated? What other choice do they have?” said Christy Conrad, spokeswoman for St. Louis-based Enterprise, which became the nation’s biggest rental-car company mostly on the strength of its neighborhood rental shops that provide temporary replacements while cars are being repaired.
“This isn’t the first time we’ve seen the competition in our market. It happens in cycles; competition comes and goes,” she said. “We really do a better job when the competition is there. It keeps us on our toes.”
The privately owned Enterprise, which boasts it has sites within 15 miles of 90 percent of the U.S. population, has been the 800-pound gorilla in the local and replacement market, thanks to its deals with major insurers, large auto dealers and automotive-service companies.
Such neighborhood dominance, observers say, has given Enterprise relative stability and made it more recession-proof than other rental companies more reliant on air travelers. In good times and bad, car wrecks happen, and people need rentals.
“There aren’t too many industries you can think about where there’s such a major domination in one marketplace,” Abrams said of Enterprise.
Hertz hopes to chip away at that, seeking growth beyond its comfort zone of airports, where it enjoys a 30 percent market share. By stepping into suburbia, Hertz, owned by Ford Motor Co., sees the lucrative insurance-replacement market as a “very promising niche,” spokeswoman Paula Stifter said.
“In (that) arena, body shops and insurance companies are welcoming the choice,” she said. Stifter said Hertz has about 7,200 outlets worldwide, though she declined to specify the number in the United States.
Meanwhile, the Cendant Car Rental Group — which bought Budget out of bankruptcy in 2002 and also operates Avis — also has taken to the neighborhoods. In August statements trumpeting its opening of 15 new car-rental sites in the West and Midwest, Avis cast the growth “as part of its commitment to expand into local markets nationwide.”
Nationwide, Avis has about 1,000 outlets and Budget roughly 950, with each having about 700 of those sites away from airports, Cendant Car Rental Group spokesman Ted Deutsch says.
“It’s a sector of the market with the greatest growth potential,” he said for a company that globally has about 1,850 Budget outlets and 1,750 Avis ones. Away from airports, “we’re not just looking to put stores there just to say we’re there. We’re looking for good, solid conditions.”
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