usrentacar.co.uk ® Car Hire USA Blog

Hi all,

Most USA car rental locations in the America are run as franchises, this gives the owner of the particular franchise the option to work with tour operators, like ourselves, or not.

This morning we have received word from Dollar Rent A Car stating a couple of locations that have opted out of the tour operator program and will no longer be bookable for any tour operators; basically they will only be accepting domestic bookings.

Dollar Locations

The Miami car hire location has never really been that popular to collect from but the Fisherman’s Wharf location is a bit of a shame, although Dollar do offer an office out of O’Farrell street approximately 2.5 miles away.

Any rentals booked to collect from these rental dates after the date the service stop’s will be honoured.

regards,

James

Hi all,

Back in July I posted about the current car hire wait times at Orlando International Airport,  today I thought it might be an ideal time to revisit this post and see if any of the supplier have managed to decrease their queue times.

Wait Time is a feature of the usrentacar voucher app, which can be downloaded for free from either the apple store or the Android Market, the app allows usrentacar customers to view the wait time for their specific supplier for that day or display the overall average time for that location. All the times displayed are specific to the customers pick up location and supplier.

Customer’s are encouraged to leave their own wait time which helps us build up the appropriate data.

In July when I posted about the average wait times at Orlando International Airport, Alamo Rent A Car and Budget Rent A Car were top of the tree with an average wait time of 23 mins, 3 months on lets take a look at the results.

Average Supplier Wait Time at MCO

Dollar Rent A Car – Average Wait Time – 12 Minutes

Alamo Rent  A Car – Average Wait Time – 16 Minutes

Budget Rent A Car - Average Wait Time – 17 Minutes

So each of our suppliers Wait Time’s have improved since July, however hats off to Dollar Rent A Car who have decreased their average wait time at Orlando International Airport from 30 minutes to just 12 minutes! Great work guys.

What are you experiences of collecting from Orlando International Airport?

regards,

James

Hi all,

Quite a few things happened yesterday but none that really warranted their own post so I thought I’d amalgamate them all in one bite size article.

Dollar Rent A Car

First off the bat is Dollar Rent A Car, who after receiving no bids within its 10th October deadline have decided to push ahead with its own stand alone plans.

Dollar’s plan of action is to begin its share repurchase program, in the next 4 quarters Dollar Thrifty plan to purchase $400 Million worth of their own stock and hope to repurchase stoke used in privately negotiated transactions.

Dollar also reiterated their expectations for 3rd quarter 2011 results. DTG still expects car rental revenue to increase by around 2% compared to the same time period in 2010. 3rd quarter revenues are expected to be around $110 to $120 million excluding expenses involving a possible takeover, compared to $93.7 million for 2010. The company noted that it expects gains from sales of risk vehicles to be approximately $18 million in the 3rd quarter of 2011, compared to approximately $10 million of gains in the 3rd quarter of 2010.

Alamo Rent A Car

Alamo’s Buffalo location seems to have been out bided, as 7 companies bid for the 6 available car rental slots at the airport.

usrentacar.co.uk understands that Alamo are unhappy with the way the biding has been handled and will be taking further actions.

Petrol

Strong statistic’s provided by Wexindex show although petrol has dropped slightly, lack of supply could see a  steady increase in USA petrol prices shortly.

Another good reason to consider our gold rate which includes your first tank of fuel.

regards,

James,

Hi all,

News has been pretty scant on the proposed Hertz buyout of  Dollar Thrifty since Budget pulled out of the deal. So I thought today might be a good time to discuss where I believe the deal is at and what the possible stumbling blocks could be.

Hertz are still very keen to complete the purchase, and looking at recent market share analysis you can see why! At present Enterprise Holdings including Alamo National have a market share of around 40% and are the clear market leaders, up next is Hertz with around 20%, Avis Budget have 17% and Dollar Thrifty commands 5.7% , the top 4 companies combined have 83% of the total U.S. Car Rental market.

So Hertz’s move to buy Dollar Rent A Car will see them cement their position as the number 2 car rental company in the U.S.

Since Dollar posted a record share price high in June, a volatile market and the withdrawal of the Avis Budget  offer, Dollar’s share price has fallen 33%, even with this decline Hertz may be forced to offer $70 a share to entice the share holders to sell, this represents a 24% premium on current stock price and the second-biggest gap of any pending U.S. deal over $1 billion. However the underlying factor is that Dollar turns over higher profits than Hertz and are presently a very health and cash rich company.

The major stumbling block I can see is the potential sale of the Hertz owned Advantage Rent A Car brand. Part of seeking FTC approval for the deal would require Hertz to sell off it’s own economy brand, but with a deteriorating  U.S. market, who will have the cash or even want to take on the brand?

Dollar have set a deadline of the 10th October for all final bids to be in, however I think with Hertz being the only potential bidder this deadline will be extended.

However look for Hertz to want too get this deal done quickly rather than face competition from a newly united Avis Budget.

I’ll continue to monitor this deal closely and keep you all updated.

regards,

James,

Hi all,

Breaking news this evening regarding the Dollar Thrifty Group buy out, and as the title suggests Avis Budget have decided to pull out of the running to take over the Tulsa based USA car rental supplier.

In a regulatory filing, Avis Budget sited “current market conditions” for the decision.

We have made significant progress toward obtaining U.S. regulatory clearance for the acquisition of DTG, and we believe that such regulatory clearance could be obtained. Nonetheless, we have decided not to pursue a transaction at this time in light of current market conditions.”

Avis Budget, who have recently spent £635 million on obtaining Avis Europe, made their offer, a combination of $45.79 in cash and 0.6543 shares of common stock or approximately $1.5 billion in aggregate based on stock prices at the time, back in September 2010.

Hertz came in with their own offer and to date this still stands.

My take on the Dollar Thrifty Buy Out…. and not to blow my own trumpet but…………. I said this would happen

regards,

James

Hi all,

Following on from Scott Thompson’s letter to Budget and Thrifty sent late August, Dollar Thrifty this week sent out letters detailing the deadline they expect all formal offers to be submitted by.

The letter states

Final offers for Dollar Thrifty are due no later than 5 p.m. EST Oct. 10

The board of directors of the company will meet to review your offer, Based upon your offer, the board will decide whether to have further discussions between you and the company regarding a potential transaction.

“The company reserves the right in its sole discretion to evaluate the terms and conditions of your offer, to enter into or terminate any negotiations or agreements with any potential purchaser or purchasers at any time and to reject any or all offers from potential purchasers for any reason whatsoever.”

An interesting part of the letter asks potential buyers to list the following within their proposal

Retention of staff clearly favours Budget Rent A Car who already have a large presence in Tulsa however the regulator terms possibly suit Hertz who have already stated they would look to sell Advantage Rent A Car to complete the deal.

Hopefully all looks positive that we will finally get some closure this year.

Kind regards,

James

Hi all,

Last week Dollar Thrifty sent a letter to both Hertz and Avis Budget asking them to reply with their best and final offers to purchase the Car Hire USA company.

I’ve managed to see a copy of this letter which I have posted below

August 21, 2011

Mr. Ronald L. Nelson

Chairman and Chief Executive Officer Avis Budget Group,

Inc. 6 Sylvan Way Parsippany,

New Jersey

07054

Mr. Mark P. Frissora

Chairman of the Board and Chief Executive Officer Hertz Global Holdings,

Inc. 225 Brae Boulevard Park Ridge,

New Jersey

07656

Dear Ron and Mark:

As you are aware, Dollar Thrifty has worked cooperatively with each of Avis Budget and Hertz for many months in an effort to obtain antitrust regulatory clearance for a possible business combination transaction. We understand that these efforts have been fruitful, and believe that each of Avis Budget and Hertz is well positioned to complete the regulatory process in a manner that would permit a combination to be completed with limited economic impact. We appreciate the efforts made by each of your companies as well as your continued interest in Dollar Thrifty.

In light of the regulatory progress that has been made, we believe that it is time to ascertain whether a transaction can be accomplished with Avis Budget, Hertz or another party on terms that our Board of Directors determines are in the best interests of Dollar Thrifty and its shareholders. Accordingly, our Board has determined that it will solicit best and final definitive proposals for submission in early October. Based on the results of this process, we will consider what actions would be in the best interests of Dollar Thrifty and its shareholders. While the details of our process will be furnished separately by our financial advisors in the coming days, I wanted to provide each of you with advance notice in order to give your companies ample preparatory time in which to complete your regulatory efforts. As you can appreciate, in view of the unprecedented opportunity that each of Avis Budget and Hertz has had to assess and mitigate in advance the antitrust regulatory risks of a transaction with Dollar Thrifty, any proposal that requires our shareholders to assume any portion of such risk is unlikely to be acceptable to our Board or shareholders.

Please do not hesitate to let me know if there are any questions.

Very truly yours,

DOLLAR THRIFTY AUTOMOTIVE GROUP, INC.

Scott L. Thompson
President and Chief Executive Officer

A very interesting letter I’m sure you’ll agree. On a positive note it does look like the end is near in this epic saga.

Who do you think will purchase Dollar Thrifty?

Kind regards,

James,

Hi all,

Fresh from the news that we are expecting a price rise from Budget Rent A Car, Dollar Rent A Car have now contacted us to advise a price increase which will take effect from 20 May 2011.

The price increase will cover most of the peak summer period and will involve some of the more popular vehicles including the Intermediate (IFAR), Standard (SFAR) and the Premium Sports Utility Vehicle (PFAR) and also the Convertible (STAR).

Increases

The increases will take effect for all new reservations made from May 20, 2011;

For pick up on or after June 20, 2011

• Florida: Rates have increased for the STAR and IVAR and  the SFAR and PFAR
• All areas except Florida: The high season surcharge will commence June 20 (originally it was July 14)
• All areas except Florida: Rates have increased  for the STAR, IVAR, SFAR and the PFAR

The rate increases will effect all suppliers of Dollar Rent A Car, and is a spiralling effect from the terrible Tsunami that struck Japan in March, which has led to a real shortage of supply’s for the manufacturing of vehicles.

usrentacar.co.uk promises to try to minimise the impact it has on our pricing by swallowing as much of the increase as possible.

Remember this does not effect rentals that have already been made.

We’ll keep you posted of for further increases which seem inevitable now.

Kind regards,

James

Hi all,

The soap opera that has become the race to purchase Dollar/Thrifty took another turn yesterday when Hertz re-entered the race with an equity bid of $2.2 Billion. The offer is based on Hertz’s May 6th stock price of around $72 total per share.

Hertz’s ambitious plans for discount brand, Advantage Rent A Car could be shelved to help gain approval from the FTC which appears to have been a stumbling block for the Avis/Budget offer.

A Hertz spokesman stated that the next steps would be

we will complete the divestiture of Advantage and work toward FTC approval. We will enter into discussions with Dollar Thrifty to reach a consensual deal and look to secure support of Dollar Thrifty shareholders.

Hertz new offer eclipse’s its previous offer by 26% and Budgets by 24%, Hertz stated that improved conditions within the market place, driven by a buoyant second hand market has resulted in the improved offer.

It will be very interesting to see where this saga goes and the FTC ruling regarding Avis/Budgets proposed purchase of Dollar/Thrifty will have a massive bearing, the outcome of this is already a month overdue.

Who will benefit more from the purchase, Hertz, Avis/Budget or the consumer?

regards,

James

Hi all,

When you collect your vehicle from our suppliers locally you will be asked to sign a rental agreement. The rental agreement is a legally binding contract between you and the supplier which outlines everything that is included plus any additional items you elect to purchase locally. For example; a child seat, additional drivers or one way rental fee’s.

It is extremely important that you fully read and understand your agreement as it is very hard for us to fight any charges added to your agreement that you have signed for locally.

In the past these rental agreements have always been signed on physical paper. However in an effort to speed up the process Dollar Rent A Car have switched their rental agreements to digital contracts.

Examples -

We still recommend you fully read and understand your rental agreement before you digitally sign it and make sure if you have any questions you ask them at the time of collection.

Remember if you find you have signed for something locally, with Alamo or Dollar, that you do not recognise you do have the option to contact the local office within 24 hours to have the charge removed.

Have you used the new style digital rental agreement?

Did it speed up your collection process?

regards,

James