Table of Contents
Scope and Themes
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- What you need to know
- Definition
- Data sources
- Sales data
- Consumer survey data
- Advertising creative
- Abbreviations and terms
- Abbreviations
- Terms
Executive Summary
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- Car rental revenues declined in 2009 for the first time in six years
- Business travel declines with corporate spending cuts, affluent still renting
- Leisure travel drops as families cut travel budgets, affecting rental market
- Car rental companies cut costs by reducing fleet size, staff
- Car sharing threatens car rental industry; rental companies adopt model
- Car rental industry becoming increasingly consolidated; rates rising
- Enterprise holds one half of industry’s market share, popular with young
- Avis passes Hertz in fleet size, number of locations
- Toyota recall affects nearly 10% of rental industry fleet
- Car rental Industry goes green, younger respondents answer
- More affluent consumers participate in car rental loyalty programs
- More consumers renting cars online
- Mobile smart phone apps entering the car rental landscape
Insights and Opportunities
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- Develop social networking presence
- Car sharing presents prime opportunity for social networking
- Social media efforts should target young audience for long-term impact
- Car sharing gains popularity, car rental companies can pursue further
- Car sharing on campuses and with corporations presents opportunity to build loyalty
- Car rental companies can increase efforts to sell used fleets online
Inspire Insights
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- Trend: Tracking Our Location
- The geo-spatial web is changing our relationship to our space
- GPS can help car rental/car sharing companies locate vehicles
Market Size and Forecast
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- Key points
- Recession, decreased corporate and leisure spending hurts revenue
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- Figure 1: Total car rental revenues, at current prices, 2004-09
- Figure 2: Total car rental revenues, at inflation-adjusted prices, 2004-09
- Fleet sizes reduced as companies respond to weakened demand
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- Figure 3: Total number of rental cars in service, 2004-09.
- 2010 shows signs of possible recovery due to increased rates, cost cutting
Competitive Context
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- Car sharing threatens car rentals through accessibility, low cost
- Car rental companies entering car sharing market
- Car sharing taps markets in campuses and corporations
- Dealership rental operations still on the fringe
Brand Performance
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- Key points
- Enterprise, post-merger, leads 52% of total U.S. rental market in 2009
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- Figure 4: Number of rental cars in service, by company, 2007 and 2009
- Number of Enterprise locations unchanged, still industry leader
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- Figure 5: Number of car rental locations by company, 2007 and 2009
Brand Performance—Enterprise Holdings
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- Key points
- Enterprise expands with purchase of Alamo, National Car Rental
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- Figure 6: U.S. revenues for Enterprise Holdings, 2004-09
- With local rental focus, Enterprise picks consumers up
- Enterprise focuses on consumer satisfaction through survey system
Brand Performance—Avis Budget Group
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- Key points
- Avis now second in industry in revenue, fleet size and number of locations
- Facing recession, Avis implements cost-reduction plan
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- Figure 7: U.S. revenues for Avis Budget Group, 2004-09
- Avis first in industry to save costs through charging no-show fee
Brand Performance—Hertz
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- Key points
- Hit by recession, Hertz cuts fleet size, number of locations, staff
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- Figure 8: U.S. revenues for Hertz Holdings, 2004-09
- Hertz buys Dollar Thrifty for $1.2 billion
- Hertz equipment rental suffers with housing market
Brand Performance—Dollar Thrifty Automotive Group
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- Key points
- Dollar Thrifty defines itself as value brand
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- Figure 9: U.S. revenues for Dollar Thrifty Automotive Group, 2004-09
- Hertz’s purchase of Dollar Thrifty may not necessarily slow growth
Brand Performance—Other
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- Key points
- Fox Rent A Car one of few growing small companies
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- Figure 10: Revenues for other car rental companies, 2007 and 2009
- Overall revenue of independents declined due to consolidation
Market Drivers
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- Business travel declines with corporate spending cuts, affecting car rentals
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- Figure 11: Total U.S. travel spending revenues, at current prices, 2004-10
- Leisure travel declines as families cut budgets
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- Figure 12: Number of summer (June, July, August) leisure travel trips, 2004-09
- Industry consolidation resulting in smaller fleets, higher prices
- Toyota 2009-10 recalls affect nearly 10% of rental car industry fleet
- Greening of rental car industry
- Municipalities target car rental companies for levying higher sales tax
- Major car rental companies inaugurate car sharing programs
Brand Qualities
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- Enterprise tracks customer satisfaction through survey system
- Hertz leads industry in customer loyalty programs
- Rent A Ride USA leverages auto repair shop for referrals
Innovation and Innovators
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- Hertz enters online used-car sales market, launches Hertz Rent2Buy
- Avis innovates iPhone app, allows users to reserve, locate cars
- Hertz “NeverLost” campaign allows consumers to transfer plans to GPS
Advertising and Promotion
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- Overview
- Digital Media
- Hertz’s use of Twitter, Facebook makes it an industry leader in social networking
- Other car rental companies slow to fully embrace social networking
- Avis leader in mobile apps
- Partnerships and product placement
- Hertz engages in brand makeover
- Enterprise goes green
- Broadcast media
- Hertz plays hitmaker with new campaign
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- Figure 13: Hertz ad, 2010
- Figure 14: Hertz ad, 2010
- Enterprise promotes partnership with NHL
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- Figure 15: Enterprise ad, 2009
- Figure 16: Enterprise ad, 2010
- National Car Rental campaign touts company’s changes
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- Figure 17: National Car Rental ad, 2010
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- Figure 18: National Car Rental ad, 2010
- Avis suggests consumers take “rental health day”
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- Figure 19: Avis ad, 2009
Reasons for Renting Cars
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- Key points
- Car rental operators need to expand appeal of rentals to everyday usage
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- Figure 20: Frequency of car rentals, for personal business and any reasons, April 2008-June 2009
Car Rental Participation
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- Key points
- One third of total respondents rent cars
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- Figure 21: Car rental participation, by gender, February 2010
- Youngest respondents aged 18-24 least likely to rent cars
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- Figure 22: Car rental participation, by age group, February 2010
- Household income is a leading demographic driver of car rentals
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- Figure 23: Car rental participation, by household income, February 2010
Reasons for Not Renting a Car
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- Key points
- Personal car use dominates reasons why consumers don’t rent cars
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- Figure 24: Reasons for not renting a car, by gender, February 2010
- Household income level drives travel, car rentals
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- Figure 25: Car rental participation, by household income group, February 2010
Preferred Method to Book Rental Car
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- Key points
- Majority of respondents book rental cars online
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- Figure 26: Preferred method to book rental car, by gender, February 2010
- Young respondents rent less online, present opportunity
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- Figure 27: Preferred method to book rental car, by age group, February 2010
- More affluent households more likely to rent online
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- Figure 28: Preferred method to book rental car, by household income, February 2010
Preferred Booking Time Use of Rental Car
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- Key points
- Majority of respondents book rental cars for one week
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- Figure 29: Preferred booking time use of rental car, by gender, February 2010
- Young respondents take short trips, older respondents take long
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- Figure 30: Preferred booking time use of rental car by, age group, February 2010
- Middle-income respondents most likely to rent for one week
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- Figure 31: Preferred booking time use of rental car, by household income, February 2010
Preferred Car Rental Company
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- Key points
- Enterprise is most preferred car rental company among respondents
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- Figure 32: Preferred car rental company, by gender, February 2010
- Enterprise preferred most among respondents aged 18-24
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- Figure 33: Preferred car rental company, by age group, February 2010
- Less affluent households prefer Enterprise
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- Figure 34: Preferred car rental company, by household income, February 2010
Preferred Vehicle Class of Rental Car
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- Key points
- Most respondents rent basic classes of rental car, price concern likely
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- Figure 35: Preferred vehicle class of rental car, by gender, February 2010
- Young respondents prefer compact, potentially hybrid vehicles
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- Figure 36: Preferred vehicle class of rental car, by age group, February 2010
- Higher-income households prefer larger class of vehicle
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- Figure 37: Preferred vehicle class of rental car, by household income, February 2010
Options Purchased At Time of Booking
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- Key points
- Gas fill-up upon return is the most popular rental option purchased
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- Figure 38: Options purchased at the time of booking, by gender, February 2010
- Respondents aged 25-34 more likely to buy insurance
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- Figure 39: Options purchased at the time of booking, by age group, February 2010
- Less affluent households most likely to pay for gasoline services
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- Figure 40: Options purchased at the time of booking, by household income, February 2010
Incentives Influencing Car Rental Booking
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- Key points
- Respondents use AAA memberships more than company loyalty clubs
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- Figure 41: Incentive influencing car rental booking, by gender, February 2010
- Elderly respondents use senior discounts, not surprisingly
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- Figure 42: Incentive influencing car rental booking, by age group, February 2010
- More affluent households most likely to use loyalty clubs, AAA
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- Figure 43: Incentive influencing car rental booking, by household income, February 2010
Race and Hispanic Origin
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- Key points
- Hispanic respondents least likely to have rented car
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- Figure 44: Car rental participation, by race, April 2008-June 2009
- Hispanic respondents not renting because they are traveling less
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- Figure 45: Reasons for not renting a car, by race, February 2010
- Hispanic respondents renting online use third party sites
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- Figure 46: Preferred method to book rental car, by race, February 2010
- Budget leads among Hispanic respondents
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- Figure 47: Preferred car rental company, by race, February 2010
- Hispanic respondents using coupons at double rate than blacks
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- Figure 48: Incentive influencing car rental booking, by race, February 2010
Cluster Analysis
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- No-Frills Enterprisers
- Characteristics
- Opportunity
- Incentivized Onliners
- Characteristics
- Opportunity
- Extra Weekenders
- Characteristics
- Opportunity
- Characteristic tables
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- Figure 49: Car rental clusters, February 2010
- Figure 50: How consumers make car rental reservations, by car rental clusters, February 2010
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- Figure 51: How long consumers rent cars, by car rental clusters, February 2010
- Figure 52: Rental agency preference, by car rental clusters, February 2010
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- Figure 53: Car rental model preference, by car rental clusters, February 2010
- Figure 54: Car rental options purchased, by car rental clusters, February 2010
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- Figure 55: Car rental incentives utilized, by car rental clusters, February 2010
- Demographic tables
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- Figure 56: Car rental clusters, by gender, February 2010
- Figure 57: Car rental clusters, by age, February 2010
- Figure 58: Car rental clusters, by household income, February 2010
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- Figure 59: Car rental clusters, by race, February 2010
- Figure 60: Car rental clusters, by Hispanic origin, February 2010
- Cluster methodology
Appendix: Other Useful Consumer Tables
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- Reasons for not renting and age
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- Figure 61: Reasons for not renting a car, by age group, February 2010
- Preferred booking time and race
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- Figure 62: Preferred booking time use of rental car, by race, February 2010
- Preferred vehicle class and race
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- Figure 63: Preferred vehicle class of rental car, by race, February 2010
- Options purchased and race
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- Figure 64: Options purchased at the time of booking, by race, February 2010
Appendix: Trade Associations
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