Operations

Avis Budget Won’t Increase its Ownership Stake in Carey International

Posted on November 12, 2008 by LCT Staff - Also by this author - About the author

PARSIPPANY, N.J. – Avis Budget Group confirmed to Business Travel News that it has declined to increase its stake in chauffeured transportation provider Carey International to 80% from 45%. Avis Budget had one year to assume the majority stake following its initial October 2007 investment in Carey.

"Due to the challenging economic environment, we have chosen not to exercise our option," Avis Budget vice president of corporate communications and public affairs John Barrows said in an e-mail to BTN.

Avis Budget officials had described the initial $60 million investment in Carey as a way to diversify its offerings to offer a complete ground transportation solution to the corporate market. "It's another product to put in our bag," Avis Budget CEO Ronald Nelson told BTN in January. "Many of our top customers spend as much on limo as they do on car rental."

Avis Budget also cited the weakening economy as a factor in its third-quarter financial results. The company recorded $1.7 billion in revenue, similar to its 2007 third-quarter revenue levels, but Nelson in a conference call with investors said corporate and leisure demand began to drop in August and has continued to do so since, and he warned of a weak fourth quarter.

"We are facing the perfect storm for our industry," Nelson said. "The decline in enplanements and the downturn in the global economy have and the foreseeable future will significantly impact leisure and commercial demand." Corporate demand declined "even faster than we anticipated," he said.

Despite the weakening demand, Nelson said there were some bright sports for Avis Budget in the corporate market. "Our commercial account growth has been solid," Nelson said. "In the quarter, we won more accounts than we lost, as measured by revenue. In October alone, we signed $15 million of new commercial business. Additionally, our small-business program growth continues to exceed our expectations. In this quarter alone, we enrolled almost 20,000 new accounts in the program. We are pleased with the sales momentum we are seeing across all areas."

Source: Business Travel News

View comments or post a comment on this story. (0 Comments)

More News

Torched Limo Owned By A Muslim Immigrant Businessman

The owner estimates $70,000 in fire damages to the Lincoln MKT stretch burned by anti-Trump rioters on Inauguration Day.

Anti-Trump Protesters Block Uber Headquarters

The TNC's CEO Travis Kalanick is one of several technology executives who's part of the president's Strategic and Policy Forum.

Toronto Operator Emphasizes Occasions

WebXclusive: Ash Fadil works to provide experiences that will have his clients coming back for more than just one special event.

What Judges Look For In OOY Award Entries

Read up on what some contenders have already submitted in their running to become an Operator of the Year.

Atlanta Operator Supports Strength In Numbers

Chad Casey knows industry involvement is a must when discovering new affiliates.

See More News

Facebook Comments ()

Comments (0)

Post a Comment

Submit

Blogs

See More

See More

See More

See More

LCT Store

LCT Magazine - January 2017 $12.95 THE MONEY ISSUE COVER STORY: * Dashboard Helps Steer Company Finances * *



Connect

Experience the three annual industry events for networking for business, showcasing vehicles and products, and getting the tools for success.

Read About Your Region

What’s Happening Near You?
Click on any state to see the latest industry news and events in that region.

More From The World's Largest Fleet Publisher

Automotive Fleet

The Car and truck fleet and leasing management magazine

Business Fleet

managing 10-50 company vehicles

Fleet Financials

Executive vehicle management

Government Fleet

managing public sector vehicles & equipment

TruckingInfo.com

THE COMMERCIAL TRUCK INDUSTRY’S MOST IN-DEPTH INFORMATION SOURCE

Work Truck Magazine

The number 1 resource for vocational truck fleets

Metro Magazine

Serving the bus and passenger rail industries for more than a century

Schoolbus Fleet

Serving school transportation professionals in the U.S. and Canada

Please sign in or register to .    Close