With 2017 just underway, what may happen in the car rental sector over the next 12 months? Below I have made five predictions related to the major US and European operators of what the year might bring. I expect 2017 to be exciting for the car rental sector, which is reflected on the events I see coming.
- Sixt will step up its game and make a move for Hertz, either the European/ International operations, thereby becoming a European leader, as a defensive move against recent Enterprise rumblings on Sixt’s home turf (most likely), or Hertz Global, thus going all-in to become a European leader and consolidating its US-presence all at once (long shot).
- Avis Budget has been actively pursuing an inorganic growth strategy in Europe lately. Having closed acquisitions in France and Italy, one would expect Germany, Spain and/ or the UK to be next on the agenda. My bet is on Spain and an acquisition of either Goldcar or RecordGo, thus creating a very strong presence across Southern Europe.
- Hertz will either be acquired (see point 1) or go private during 2017, with a mix of the two not to be excluded. A disposal of its International operations to focus its attention on the US car rental market, where it is in danger of dropping to 3rd place, makes strategic sense and private ownership, thus being out of the public eye, could serve as a facilitator to a successful turnaround.
- Europcar, who late 2016 announced aggressive growth targets, is likely to focus on growing its corporate presence inorganically, acquiring currently licensed operations in 2 or 3 countries
- Enterprise becomes the first car rental operator committing to provide autonomous vehicles within a defined time frame
One last bet on a tangential sector is that Uber will acquire a car rental/ car sharing/ leasing and/ or fleet management company in preparation for the large-scale deployment of autonomous cars.
My predictive skills, or lack thereof, will be confirmed by or on 31 December 2017.
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