Profile: Avis Budget Group Inc (CAR.O)
6 Dec 2013
Avis Budget Group, Inc. (Avis Budget) operates two brands in the global vehicle rental industry through Avis and Budget. Avis is a rental car supplier positioned to serve the commercial and leisure segments of the travel industry and Budget is a rental car supplier focused primarily on more value-conscious segments of the industry. The Company is a vehicle rental operator in North America, Europe, Australia, New Zealand, and certain other regions it serves. The Company and its licensees operate the Avis and Budget brands in approximately 175 countries worldwide. It operates in three segments: North America, consisting of its Avis and Budget car rental operations in the United States and its Avis and Budget vehicle rental operations in Canada; International, consisting of its Avis and Budget vehicle rental operations in Europe, the Middle East, Asia, Africa, South America, central America, the Caribbean, Australia and New Zealand, and Truck Rental, consisting of its Budget truck rental operations in the United States. On October 3, 2011, the Company acquired Avis Europe plc. Effective March 14, 2013, the Company through its wholly owned subsidiary Millennium Acquisition Sub Inc acquired Zipcar Inc. In July 2013, Avis Budget Group Inc acquired Payless Car Rental.
The Company maintains an interest in airport car rental revenue in North America, Europe, Australia and New Zealand, and it operates truck rental businesses in the United States. During the year ended December 31, 2011, the Avis, Budget and Budget Truck brands accounted for approximately 64%, 30% and 6% of its revenue, respectively. The Company’s rental fleet totaled more than 393,000 vehicles and it completed more than 24 million vehicle rental transactions worldwide in 2011. In 2011, it derived approximately 74% of its total car rental time and mileage revenue from on-airport locations and approximately 26% of its time and mileage revenue from off-airport locations, which it refers to as its local market business. The Company rents its fleet of approximately 26,000 Budget trucks through a network of approximately 1,850 dealer-operated and 300 Company-operated locations throughout the continental United States.
Car Rental Business
The Company operates or licenses the Avis car rental system (the Avis System), which is consisted of approximately 5,200 locations worldwide. The Company operates approximately 2,100 Avis car rental locations worldwide, in both the on-airport and local rental markets. In addition, the Company licenses the Avis brand to other independent business owners in approximately 3,100 locations worldwide. The Company operates or licenses the Budget vehicle rental system (the Budget System), which is consisted of approximately 3,050 car rental locations. The Company operates approximately 1,100 Budget car rental locations worldwide. It also licenses the Budget System to independent business owners who operate approximately 1,950 locations worldwide. Customers can make Avis and Budget car rental reservations through its Avis and Budget Websites at avis.com and budget.com, through its reservation centers (also referred to as contact centers), through online travel portals, travel agents, or through selected partners, including airlines.
The Company rents a variety of vehicles, including luxury and specialty vehicles. Its fleet consists primarily of vehicles from the current and immediately preceding model year. The Company maintains a single fleet of vehicles for Avis and Budget in countries where it operates both brands. During 2011, approximately 25%, 24% and 18% of the cars acquired for its North American car rental fleet were manufactured by Ford, General Motors and Chrysler, respectively. During 2011, it purchased vehicles from BMW, Hyundai, Kia, Mazda, Mitsubishi, Nissan, Subaru, Suzuki, Toyota and Volkswagen for its North American fleet. During 2011, it purchased vehicles from Audi, BMW, Chrysler, Fiat, Ford, Hyundai, Mercedes, Mitsubishi, Nissan, Porsche, Renault and Toyota for its International fleet.
The Company competes with Hertz Global Holdings, Inc., Dollar Thrifty Automotive Group, Inc., Enterprise Rent-A-Car Company, Europcar and Sixt AG.
Truck Rental Business
Budget’s truck rental business is a local and one-way truck rental business in the United States. The Budget truck rental business has a combined fleet of approximately 26,000 trucks, which are rented through a network of approximately 1,850 dealers and 300 Company-operated locations throughout the continental United States. A certain number of its dealer locations are operated by its Budget car rental licensees. The Budget truck rental business serves both the consumer and light commercial sectors. The consumer sector consists primarily of individuals who rent trucks to move household goods on either a one-way or local basis. The light commercial sector consists of a range of businesses that rent light- to medium-duty trucks, which it defines as trucks having a gross vehicle weight of less than 26,000 pounds, for a variety of commercial applications.
The Company also offers its customers a range of ancillary products. The Company rents automobile towing equipment and other moving accessories, such as hand trucks, furniture pads and moving supplies, as well as where2 global positioning system (GPS) navigation units. The Company also makes available to customers a range of coverages, such as physical damage waivers, automobile towing protection, personal accident and cargo insurance and supplemental liability insurance. Budget’s truck rental business is offered through a national network, which included approximately 1,850 dealers as of December 31, 2011.
The Company competes with U-Haul International, Inc., Penske Truck Leasing Corporation, Ryder System, Inc. and Enterprise Rent-A-Car Company.
Avis Budget Group Inc
6 Sylvan Way
PARSIPPANY NJ 07054