Car rental companies should be feeling good about opportunity for growth and expansion. If you’re willing to merge traditional standards and innovation, you can take advantage of new trends while navigating potential risk.
The intent of this article is not an analysis. But rather to point out some areas that on-airport and off- airport companies can look to for benefit. We encourage you to read about the nuances of change within the industry and to talk to trusted sources. Our summary view is that overall car rental has evolved intensely in recent years and will continue evolving. Especially when we look at hiring a passenger vehicle for business and leisure for short-term duration. Your specific niche may determine your approach to working with this evolution, but you’ll want to make flexibility a mantra. Avoid fear of rental alternatives hurting your business, and focus on the potential that mobility trends hold out.
Make car rental alternatives a value-add rather than a threat
We’ll start with car sharing. Which we view as car rentals with a short usage span per customer and a denser customer base. Zipcar, a pioneer in the field within the United States, was acquired by Avis in 2013. This was due to the fact, that they promise to offer more diversified customer services. Incorporating car sharing calls for extremely agile and accurate handling of customer records, payment, service, and vehicle allocation and monitoring. Car rental companies are in a strong position to add car sharing to their portfolio. Especially when they have robust skills and operational experience in fleet management, logistics and general rental operations
The next level
To handle the changes it is critical to tailor working practices and ensure their IT platform is up-to-date. Examples that stand beside Avis Budget/Zipcar include: Sixt’s JV with BMW (DriveNow), Europcar’s JV with Daimler AG (Car2Go Europe), Hertz 24/7 in several European countries, and Enterprise Car Share in the UK. P2P services such as Uber also offer new avenues for growth in the car rental industry, not erosion. Within Europe and other countries, P2P is usually confined to urban areas and parallels more directly with taxis than car rental. Travelers and city-dwellers already have the tendency to use taxis and other forms of public transportation than a rental car. While there is of course challenge to look at, car rental companies should consider exploring opportunities to take on low-margin but high-volume transport—you’ve got the foundational experience.
"How will you position yourself within the car rental industry so that you can evolve? A more diverse portfolio and more ways to reach customers is within reach."
Mobility: The mega trend that will drive your success in the car rental marketplace.
Mobility is the force that will enable car rental companies to offer services anytime, anywhere, via devices and channels that reach the largest possible span of customers. It will let customers manage whatever service option they turn to from first glance through final payment remotely, on their phone, at a kiosk, via a site.
On the business side, mobility solutions will enable companies to maintain precise and real-time information about all aspects of vehicles and the environments they use. It is possible to use data for immediate action and longer-term insight. Usage, operations, maintenance, fleet allocation, market analysis are just the tip of what can be monitored, mined, and most importantly, shared.
Mobility’s potential spans smart phones, IoT, enhanced driver experience, even self-driving cars. The car rental industry is a key service provider at the heart of the mobility universe and has opportunity to strengthen current business and IT models with mobility solutions that speak to an evolving market.