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The Car Rental Industry

The US segment of this marketplace averages about $18.5 billion in revenue a year. Today, roughly 1.9 million rental vehicles that service us states segment of the market. Furthermore, there are numerous rental agencies form industry leaders that subdivide the entire revenue, namely Dollar Thrifty, Budget and Vanguard. Unlike other mature service industries, the rental car market is highly consolidated which naturally puts potential new comers in a cost-disadvantage since they face high input costs with reduced probability of economies of scale. Moreover, many of the profit is generated by a number of firms including Enterprise, Hertz and Avis. For your fiscal year of 2004, Enterprise generated $7.4 billion overall revenue. Hertz arrived second position with about $5.2 billion and Avis with $2.97 in revenue.

The Auckland Car Rental industry faces an absolutely different environment of computer did 5yrs ago. As outlined by Business Travel News, vehicles are now being rented until they have accumulated 20,000 to 30,000 miles until they are relegated towards used car industry whereas the turn-around mileage was 12,000 to fifteen,000 miles 5yrs ago. Because of slow industry growth and narrow profit margin, there is no imminent threat to backward integration from the industry. In truth, one of many industry players only Hertz is vertically integrated through Ford.

Scope of Competition

There are numerous factors that shape the competitive landscape from the car rental industry. Competition arises from two main sources over the chain. About the vacation consumer’s end on the spectrum, level of competition is fierce not simply for the reason that marketplace is saturated and well guarded by industry leader Enterprise, but competitors operate at a cost disadvantage in addition to smaller market shares since Enterprise has built a network of dealers over 90 {1c74626021d9c5a8d5059ea98d64b8f290317673ada7d772ef8a992974ff6973} the leisure segment. About the corporate segment, however, competitors is very strong in the airports since that segment is under tight supervision by Hertz. Because industry underwent a large economic downfall lately, there are upgraded the size of competition within the majority of the companies which survived. Competitively speaking, the rental car companies are a war-zone as many rental agencies including Enterprise, Hertz and Avis among the major players engage in a battle in the fittest.


Within the last few five years, most firms have been working towards enhancing their fleet sizes and enhancing the degree of profitability. Enterprise the company while using the largest fleet in the US has added 75,000 vehicles for its fleet since 2002 that help increase its range of facilities to 170 on the airports. Hertz, on the flip side, has added 25,000 vehicles and broadened its international presence in 150 counties as opposed to 140 in 2002. Also, Avis has risen its fleet from 210,000 in 2002 to 220,000 despite recent economic adversities. Through the years following the recession, although a lot of companies through the entire industry were struggling

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