»»Car Rental Struggling As Customer Satisfaction Declining
With companies reducing business travel and fewer airline passengers to rent cars at airports, the car rental industry has been heavily hit by the economic downturn.
USA TODAY reports figures showing the current frailty of the industry’s health.
- Avis Budget Group this month eliminated 2,200 jobs — about 7% of its employees. Hertz says it laid off 2,000 workers this year, and Dollar Thrifty, Enterprise, National and Alamo also reduced their workforces in recent months.
- Hertz reported that net income dropped 94% to $63 million during the first nine months this year. There also was a 2% drop in the number of days its cars were rented.
- Advantage Rent A Car announced on Dec. 8 that it filed for bankruptcy reorganization in federal bankruptcy court. The company also said that rentals are no longer available at most of its 48 U.S. locations.
- A Standard & Poor’s research report released in late November said Dollar Thrifty “appears to be the most likely” of the big rental companies to file for protection from creditors in bankruptcy court. A Dollar Thrifty bankruptcy filing “might even result in a liquidation,” the report said. (source)
usatoday.com also cites a study showing customer satisfaction with renting cars at airports has declined considerably.
To survive car rental companies are reducing their workforces and fleets and shuttering under performing locations.
Also, because the used car market is weak and their resale values are low, car rental companies are keeping vehicles in their fleets longer. That means growing difficulties in supplying clean and well-maintained cars.
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