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The rental car industry
Market Overview
The car owner is a multi-billion dollar sector of the United States. The segment of the United States the industry average of about 18.5 billion dollars in sales annually. Today there are about 1.9 million cars in the service segment of the market in the United States. In addition, there are many rental agencies, as well as industry leaders that the total revenue divided, namely, Dollar Thrifty, Budget and Vanguard. Unlike other service sectors mature, the rent > The industry is highly consolidated, which naturally leads to potential new entrants a cost disadvantage, because the high cost of entry with reduced ability to achieve economies of scale face. Moreover, most of the profit of a few companies, including companies, Hertz and Avis will be created. For the fiscal year 2004, the company earned $ 7.4 billion total revenues. Hertz came in second place with about 5.2 billion, and Avis, with $ 2.97 in revenue.
Degree of integration
Rental> The automotive industry is facing a completely different from five years ago. According to Business Travel News, hired vehicles that are up 20,000 to 30,000 miles up to them to take advantage of the auto industry that this was the mileage accumulated Losers held around 12,000 to 15,000 miles before five years. Due to the slow growth of the sector, and the narrow margin of profit, there is no immediate danger to integrate backwards in the field. In fact, among the industryHertz is not well integrated vertically by Ford.
Degree of competition
There are many factors that shape the competitive environment in the car rental industry. Competition comes from two sources in the entire chain. At the end of the holiday the consumer spectrum, and competition is tough, not only because the market is mature and well kept, with a leading company in the industry, but competitors joined a disadvantage in price with market shares lowerEnterprise has established a...
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