Car rental 2010

The Soccer World Cup is a major international attraction and the number of tourists expected varies from 400 000 to 750 000. Carrental companies have not taken the expected demand and strain on their systems and fleets lightly: each has establishedWorld Cup committees to plan in detail for the expected influx of visitors and the related increase in demand.

Fleet planning has been a critical element in this regard. Normally, on a monthly basis, there would be a continuous influx and outflow of vehicles into the fleets. However, detailed planning has allowed car-rental companies to bring new car orders forward and adjust the timing of de-fleeting to just after the World Cup.

A spinoff is that the second-hand car market will be overstocked after the World Cup final; so if you (or your client) are looking to buy a second hand vehicle, my advice would be to wait till August next year and watch as the major groups de-fleet via their dealer networks.

Some car-rental companies have adopted a novel approach to the World Cup. Each of the major South African companies is closely associated via their group holdings to a dealer network that sells second-hand vehicles. The stocks of these dealers may be utilised for the two-month rental period during the WorldCup to ‘bulk up’ the fleet. It is a cost-effective utilisation of assets for the holding company and it also assists the car-rental companies in meeting demand during the two months of theWorld Cup.Overall, during the event, the industry is well placed to facilitate the huge increase in volumes, and of all the transport networks within the South African market, I do believe the carrental industry will take the lead in this area due to the entire process being well managed. From an insurance replacement point of view, I do not foresee any availability issues.

Green has become the new buzzword in the industry and is increasingly becoming a focus area for most car-rental companies. Worldwide and in South Africa, the leading companies have taken the initiative by joining affiliates to offset carbon emissions. South African car-rental companies have been slow on the uptake of ‘green’, but I suspect we will see much activity in this area within the industry during 2010 and beyond.After a tough economic climate in 2009, we are all looking forward to a more positive 2010. The car-rental industry, like many others, has had a tough year, and the bottoming of world economies coupled with the positive effects of the World Cup should bring a positive growth phase during 2010.