Travellers returning from their holidays with tans and souvenirs are also returning with stories of incredibly high car rental prices, Avis has announced a plan to streamline its operations as to cope with the downturn in the travel industry.
As overall travel volume declined by 9.4 percent in the six month period to June 30, car hire companies have also taken a hit by the global recession.
Avis have reported a drop of 6.8 percent over the six months, but performance was stronger, with a drop of only 2.9 percent, because of the holiday season.
The company has also predominately been affected by the worldwide downturn specifically of corporate travel, as business car rental is one of Avis’ key markets.
Despite the declines, the car hire industry has benefited from raising their prices which has led to greater profit margins, as most companies have been forced to charge higher and sell vehicles as credit has been difficult to obtain.
Avis have been fighting the downturn by reducing its fleet by 16%, which has led to an increase in utilisation by 5 percent.
The company has also set out a plan streamline the management of its fleet by cutting back the number of new vehicles purchased by 30 percent, and has reduced its £1.1 billion debt by closing poor performing outlets and slashing jobs.
Following a rather optimistic peak season, Avis plan to expand into Asia and boost its UK operations, however the company forecasts a weak winter season.
Thanks to The Times. For more information on this article visit their website.
