FTC Squeeze Hertz One Last Time Before Confirming Dollar Deal

Hi all,

So the FTC have finally given the green light for Hertz to complete its buyout of Dtag (Dollar Thrifty). The deal which I’ve been writing about for close to 2 years received FTC approval with a vote of 4-1 on Friday and mean’s Hertz will now become the second largest USA car hire company.

However the FTC who were rightly concerned about restriction of  competition  in the U.S. have asked for a few compromises before agreeing to the deal.

Advantage Rent A Car Sale

The main compromise was the sale of Hertz’s value product; Advantage Rent A Car to the organisation who currently own U-Save Car Rental and Rent A Wreck for  $16 million, half the sum that Hertz originally paid for it.

Although the diluting of one of Hertz’s brands was seen as a positive step, doubters still believed that this wasn’t going far enough, the main reason being cited was “can the Franchise Services of North America, Inc. (FSNA) compete with the likes of Avis/Budget and Enterprise?”

Airport Locations

Well no, they can’t really and one of the reasons is getting hold of airport locations. The FTC were also concerned that the Hertz Dollar deal would impact airports hugely with Hertz at some locations being represented by 3 well known brands.

So part of the agreement has seen Hertz agree to give up some of their prime airport locations  I was originally told it would be 15 or 16 locations but reports have now confirmed that Hertz  have agreed to give up 29 Dollar Thrifty locations.

16 of these airport locations will be sold to FSNA the other 13 locations will be sold to another party to be determined before the deal is finalised.

FTC Chairman Jon Leibowitz said.

American consumers rent more than 50 million vehicles at airports nationwide each year, spending $11 billion, so this is a real pocketbook issue for everyday people. Today’s bipartisan action by the FTC will ensure that consumers are not forced to pay higher prices for rental cars when they travel.

As I have mentioned before the deal has concerned many as the car rental market alters from 4 competing firms to 3 with no other supplier really armed to even compete on an even scale.

Commissioner J. Thomas Rosch the only FTC member to vote no explained

I voted against acceptance of the consent decree because I found it inadequate to resolve the competitive concerns at several dozen other airports affected by the transaction. I would have instead voted to challenge the transaction because of the significant risk of post-merger coordinated interaction among the remaining competitors.

usrentacar.co.uk facebook community also felt the deal was problematic and voted narrowly against the deal in our online poll.

I guess only time will tell as the proposed deal is open to public comment until the 17th December.

What do you think?



 car hire USA

Scott Thompson CEO of Dollar Thrifty’s 10 Key Points To Running A Successful Business

Hi all,

Back in 2008 if you’d said Dollar Rent A Car would be sold to Hertz for $87.5 a share people would have laughed at you,  Dtag (Dollar/Thrifty) were in a bad way, the were in default of their loan agreements, they had a share price of 97 cents and were headed towards a yearly net loss of  appropriately $350 million!!

So how did they turn it around? Well a lot of the praise lies with Scott Thompson who was made CEO after only 6 months of joining the company. Scott who had been part of a very successful fortune 500 company had actually retired back in 2005 but like most entrepreneurs became restless and initially joined Dollar as CFO.

As soon as Scott became CEO he was forced to make some very hard decisions he believed that the company had too many top level managers which was detrimental to the company so he quickly removed half of them.

He also looked closely at the profitability of each location and closed those locations that fell behind his expectations and also looked for new ways to sell ageing fleet.

His trickiest moves would come in convincing Wall Street to invest in the company and bringing in new car manufactures to help offer a competitive edge.

A few years on down to good leadership and very hard work Dollar Rent A Car is the jewel in the car hire crown, so much so that Hertz are willing to get rid of their own value product for a loss of $17 million to help capture the brand.

In a great article, found here, Scott Thompson reveals his 10 key points to running a successful business 

1. Realize that people are your greatest asset.

2. Understand where you have to go and how long you have to get there.

3. Remember the other side of risk is reward. Do not shy away from risk.

4. Focus on the substance of issues and ignore politics.

5. Trust each other.

6. Tell everyone inside and outside the company the absolute truth.

7. When you make mistakes, admit them, fix them and don’t look back.

8. Hire the best advisers.

9. Work hard while supporting each other during the ups and downs.

10. Make sure employees know they should not allow the CEO to do anything stupid.

When someone with a proven track record offers this kind of advise I would imagine you should pay attention.



 Florida car hire

This Is How I Think Hertz Will Use Dollar & Thrifty

Hi all,

The buzz around the Hertz Dollar Rent A Car deal hasn’t really died down yet, yesterday both companies released statements confirming the deal at $87.5 per share equating to a buyout of $2.6 Billion, Hertz also confirmed that they have a buyer for their low cost brand Advantage Rent A Car who equate to about 1% of Hertz’s overall sales.

So what is Hertz’s plan for both Dollar Rent A Car and Thrifty Car Rental

USA car hire is basically split in to three sales tiers, Premium, Mid and Value. At present Hertz are competing in the Premium tier and through their Advantage brand, the value tier.

With the purchase of Dollar and Thrifty I believe they will attack all three markets.

The example above only includes suppliers that have made an impact in the UK outbound market it does not include value brands such as Fox Rent A Car, Payless Car Rental or Mid-Tier companies like Enterprise.

As you can see from the example above Hertz’s three pronged attack really allows them to compete in all tiers while at the same time protecting their Premium brand.

I also found it interesting that Hertz CEO Frissora confirmed they will position Thrifty as a “Spartan brand”, I assume this mean competitive?

Do you think the Hertz/Dollar deal is good for the consumer?



 Florida car hire

Deja Vu In The Hertz And Dollar Rent A Car Deal

Hi all,

Its with a dreaded feeling of deja vu that I write this post, its over 3 months since I last spoke about the proposed Hertz/Advantage/Dollar/Thrifty takeover, sale thingy and still nothings really happened.

On the 1st August Hertz and DTAG (Dollar and Thrifty) released their quarterly reports, nothing odd about that and both companies had very good quarters. Dollar  reported a net income for the 2012 second quarter of $49.4 million, compared to net income of $42.5 million for the second quarter of 2011. The company also reported Corporate Adjusted EBITDA for the second quarter of 2012 of $88.3 million, up from $81.2 million in the second quarter of 2011. Hertz meanwhile reported second quarter 2012 worldwide revenues of $2.2 billion, an increase of 7.4% year-over-year. Both companies taking full advantage of a very buoyant second hand car market.

The part that was missing in both their second quarter market calls was any proper mention of firstly; the continued process of the merger between Hertz and Dtag and secondly; the proposed sale of Advantage Rent A Car (Hertz’s economy brand).

In their first quarter report Hertz mentioned they had been in talks with a potential buyer of Advantage Rent A Car, thought to be U-Save Car Rental but not confirmed. Rumour also had it that the sale would move forward very quickly but since then nothing seems to have happened… Could the deal of gone cold?

Hertz did state

Hertz remains engaged with the FTC to secure antitrust clearance to potentially acquire Dollar Thrifty, which requires, among other things, the divestiture of our Advantage business.

However Dollar’s CEO Scott Thompson according to popular blog auto rental news,

expressed unusual candor – and exasperation. Aside from joking about his hair loss over the issue, he said the company has lost employees and has been negatively impacted when negotiating with strategic partners. He said no offer has been extended, and called for an end to this three-year-long saga.

So we look no closer to an end to the on off saga, but I will of course keep you updated if anything else arises.



 car hire USA

Save 10 Percent With Our New Dollar Rent A Car Sales

Hi all,

Nothing gets rid of those rainy Monday blues like a Car Hire USA sale…

Well here at usrentacar.co.uk we are happy to confirm not one but two  new special offers from our friends at Dollar Rent A Car.

Offer 1

New reservations made from today until the 16th August 2012

  • Rentals collecting from: 12th July through 16thAugust 2012
  • Regions: MCO (Orlando Airport ONLY)
  • Offer: 10% discount off of existing rates – Off usrentacar.co.uk SILVER rate product.
  • Car types: Economy through Full Size, Premium, Luxury & Intermediate SUV

Offer 2

New reservations made from today until the 16th August 2012

  • Rentals collecting from: 17th August through 13th December 2012
  • Regions: ALL (Except NEW YORK & NEWARK)
  • Offer: 10% discount off of existing rates – Off usrentacar.co.uk SILVER rate product.
  • Car types: ALL (Except: STAR, IVAR, FVAR, SFAR & FFAR)

These discounts are only available to new bookings and the 10% has already been removed and is displaying now, these rates can be secured using our £50.00 deposit scheme where applicable.

Our silver rate includes the following -

  • Unlimited Mileage.
  • Loss Damage Waiver (LDW) which is a combination insurance of both Collision Damage Waiver (CDW) and Theft Waiver. As long as you adhere to the rental policy of the supplier you will not be held responsible for the cost of replacement or repair to your hire vehicle.
  • Uninsured Motorist Protection (UMP) up to $1m Liability Cover. Offers an Uninsured/Underinsured/Hit-and-Run Motorist Protection (UMP) that provides the renter and family members travelling together in the rented vehicle with up to $1,000,000 of non-stacked coverage for bodily injury sustained while driving the rental car, and caused by another driver who has no insurance, minimal insurance, or is a hit-and-run driver.
  • Supplemental Liability Insurance (SLI) up to $1m Liability Cover. All drivers included on the rental agreement will not be held liable for third party claims for bodily injury or property damage resulting from an accident.
  • Basic Roadside Assistance
  • All Taxes and Airport Fees.

kind regards,


 car hire USA

Dollar Rent A Car Plan July Opening For 9 New Offices

Hi all,

Nobody knows who will be the owners of Dollar Rent A Car come 2013, the heavy favourite is Hertz who have been courting the company for coming up to 2 years.

Some have stated that within this courting stage Dollar slightly lost their way, and attention was taken from growing the business to selling it. However back in March Dollar confirmed their stand alone plan which included opening new locations across the U.S.

Today Dollar have confirmed they will be opening 9 new offices, 8 of which will officially open in July. They are set to be…

  • Maui Coast Hotel in Kihei, Hawaii
  • A local market Dollar Rent A Car at 339 South End Ave. (Battery Park) in New York, N.Y.
  • A dual-branded Dollar Rent A Car and Thrifty Car Rental location at the Crowne Plaza Orlando-Downtown Hotel in Orlando, Fla.
  • A dual-branded location at the Ramada Maingate West Hotel in Kissimmee, Fla.
  • Another dual-branded location at 1291 Cobb Parkway South in Marietta, Ga.
  • Lastly, in August, Dollar Thrifty plans to open a local market Thrifty Car Rental at 1066 U.S. Hwy 1 in Vero Beach, Fla.

We haven’t had confirmation if these offices will be available for usrentacar.co.uk customer but we assume that the Florida Car Hire locations definitely will be.



 Florida car hire

Are Hertz Closer To Buying Dollar Thrifty Than We Thought?

Hi all,

Amazing!! Two days in a row and I’m not talking about the redesign, so you know something must have caught my attention…and it has…

Yesterday we spoke about the Hertz quarter 1 results and the effect they could have on future inbound business, well buried within the full report which can be viewed here were some very direct wording in regards to Hertz’s marathon pursuit of Dollar Rent A Car

Within the forward statement to investors was this little nugget

Among other items, such factors could include: our ability to obtain regulatory approval for and to consummate an acquisition of Dollar Thrifty Automotive Group; the risk that expected synergies, operational efficiencies and cost savings from a Dollar Thrifty acquisition may not be fully realized or realized within the expected time frame; the operational and profitability impact of divestitures that may be required to be undertaken to secure regulatory approval for an acquisition of Dollar Thrifty;

So Hertz are stating to investors that the acquisition of Dollar Thrifty could have an impact on their 2012 profit as they slimline the organisation, also looking at the report you can see a substantial amount has been spent on Acquisition related costs.

So popping on my deerstalker, I’m going to assume the following

  • Hertz will shortly announce an agreement with the FTC regarding the purchase of Dollar Thrifty.
  • We will see a fresh Hertz bid for Dollar Thrifty this quarter.
  • Hertz have found a buyer for Advantage Rent A Car (their value brand).

Now I’m no Sherlock Holmes but I’m pretty confident when I say Dollar Thrifty will become part of Hertz this year and I’m going to take a guess that either Sixt Rent A Car or Fox Rent A Car will be the new owners of Advantage Rent A Car.

What do you think?



 car hire USA

Dollar Thrifty Reveal Cost Saving 2012 Fleet

Hi all,

With the price of petrol sky rocketing suppliers in the USA are seeing an adverse effect in their bottom line to tackle this one supplier has purchased its 2012 Fleet with this firmly in mind.

Dollar Rent  A Car and Thrifty Rent A Car who have recently updated their Fleet revealed that 67% of the vehicles purchased have a highway fuel-efficiency rating of 30 miles per gallon (mpg) or better. Additionally, 98% of Dollar Thrifty’s general car models achieve 28 highway mpg or better.

Based on the average mileage driven by Dollar Thrifty customers the fuel efficient vehicles will save an estimated $24 Million compared to the 2011 fleet, which in this day and age is pretty impressive.

Scott Thompson, President and CEO of Dollar Thrifty said

With escalating gas prices and the increasing burden on travelers, Dollar Thrifty maintains its commitment to delivering value by continuing to purchase vehicles with improved fuel efficiencies. Our diversified fleet of 2012 models not only aligns with our fiduciary duties as an environmental steward, it significantly enhances our value offering to our customers

Among the environmentally-friendly and fuel-efficient vehicles in Dollar Thrifty’s 2012 fleet purchase is the Kia Rio which has a highway mpg rating of 40 and received the U.S. EPA SmartWay Certification Mark for its low greenhouse gas emissions and minimal air pollution. Also prominent in the fleet are the popular Ford Focus Sedan and Hatchback, both of which achieve 38 highway mpg, and the Nissan Versa which also receives 38 highway mpg.

Are the miles per gallon a concern for you when booking your USA Car Hire?



 car hire USA

Dollar Rent A Car Reveals 2012 Stand Alone Plan

Hi all,

Yesterday I reported on Scott Thompson’s interview regarding Hertz’s imminent attempt at a hostile takeover of Dollar Rent A Car. One of the interesting parts of the interview was Dollar’s statement regarding plans for their future.

Scott Thompson was keen to point out that Dollar don’t have to sell and will only do so if the price is right for share holders. He also mentioned that Dollar will continue to pursue its stand alone plan for 2012 which includes a $20 million capital investment budget. Last year, the company invested $17 million in its capital projects.

Investments proposed by the company this year include new rental car locations, a new facility near Los Angeles International Airport, a new used car retail operation in Florida and long-term investments in IT.

Thompson added

“We’re looking at new (rental car) stores after a number of years of contraction. Clearly, we have a standalone plan, we have some good things going on. We are running fast, and we will see if they can catch us.”

Some nice positive plans from Dollar Rent A Car and we look forward to keeping you up to date as their 2012 plan takes shape.



 car hire USA

Dollar Rent A Car Release Full Year Accounts

Hi all,

Yesterday the Dollar Thrifty Group (DTG)  released full 2011 end of year accounts and also quarter 4 details.

In a nutshell Dollar Thrifty have had another record year eclipsing last years results which at the time was also a record year!  Boosted by a buoyant second hand market DTG boasted profits of $159.6 million,  up from $131.2 million,  in 2010. Revenue rose to $1.55 billion from $1.54 billion.

Scott L Thompson, Chairman and CEO stated

“We are pleased to announce that for the second consecutive year, the company is reporting record earnings,”

“During 2011, we benefited from a robust used vehicle market, a recovering travel market with increasing demand for value-oriented product offerings, and our ongoing focus on expense control and productivity initiatives.”

What does Dollar Thrifty expect for 2012?

2012 Outlook  

The Company is providing the following guidance for 2012 with respect to key drivers of its business model:

  • Vehicle rental revenues are projected to be up 3 – 5 percent compared to 2011.
  • Vehicle depreciation costs for the full year of 2012 are expected to be within a range of $220 to $240 per vehicle per month.
    • The Company is utilizing a Manheim index of 124 for the full year of 2012 for purposes of estimating residual values and depreciation rates.
    • Gains on sales of risk vehicles in 2012 are expected to moderate significantly on both an aggregate dollar and per unit basis compared to vehicle gains recorded in 2011.  This decrease is the result of continued refinements of residual value assumptions to more closely align with market conditions at the time of sale.
  • Interest expense is expected to decline significantly on a year-over-year basis, primarily as a result of lower overall interest rates on the Company’s fleet financing facilities as compared to the fixed rates on matured and maturing financing facilities, and the repayment of all of the Company’s corporate debt in 2011.  These decreases will be partially offset by higher rates on the newly completed revolver and the expected re-leveraging of our Canadian fleet.
So a great year for Dollar Rent A Car bucking the trends of the recession, I’ll be interested to read how other trading companies have done in 2011.

 Florida car hire

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