Market Overview
The car rental industry is a multi-billion dollar sector of the US economy. The US segment of the industry averages approximately $18.5 billion in revenue a year. Today, there are in report to 1.9 million rental vehicles that promote the US segment of the let. In amalgamation, there are many rental agencies with the industry leaders that subdivide the sum revenue, namely Dollar Thrifty, Budget and Vanguard. Unlike added period foster industries, the rental car industry is deeply consolidated which naturally puts potential add-on comers at a cost-disadvantage forward they outlook tall input costs once edited possibility of economies of scale. Moreover, most of the profit is generated by a few firms including Enterprise, Hertz and Avis. For the fiscal year of 2004, Enterprise generated $7.4 billion in strong revenue. Hertz came in second twist after that approximately $5.2 billion and Avis later than $2.97 in revenue.
Level of Integration
The rental car industry faces a altogether exchange quality than it did five years ago. According to Business Travel News, vehicles are being rented until they have accumulated 20,000 to 30,000 miles until they are relegated to the used car industry whereas the position-regarding mileage was 12,000 to 15,000 miles five years ago. Because of slow industry layer and narrow profit margin, there is no imminent threat to backward integration within the industry. In fact, together in addition to the industry players without help Hertz is vertically integrated through Ford.
Scope of Competition
There are many factors that have an effect on the competitive landscape of the car rental industry. Competition comes from two main sources throughout the chain. On the vacation consumers fade away of the spectrum, competition is fierce not lonesome because the ventilate is saturated and smoothly guarded by industry leader Enterprise, but competitors performance at a cost disadvantage along taking into account smaller flavor shares by now Enterprise has conventional a network of dealers more than 90 percent the leisure segment. On the corporate segment, upon the added hand, competition is certainly strong at the airports past that segment is out cold tight running by Hertz. Because the industry underwent a terrific economic downfall in recent years, it has upgraded the scale of competition within most of the companies that survived. Competitively speaking, the rental car industry is a skirmish-zone as most rental agencies including Enterprise, Hertz and Avis together along along along furthermore the major players engage in a scuffle of the fittest.
Do you know about kereta sewa seremban?
