Motoring on

Industry opinion is mixed as to how successfully travel agents are selling car rental products, but there are certainly some positive signs that things are looking up.

Car hire remains one of the few remaining sources of commission for agents and certain companies are offering added bonuses for agents that can up-sell car hire throughout the summer.

The main thrust of the advice car rental companies dish out to agents is to offer customers the option to rent a car whenever they book a holiday and not to settle for the cheapest vehicle, but to asses the customers' needs and recommend an appropriate car, thereby improving the quality of their own service offering and increasing their chances of earning a better commission rate.

Europe remains the leading outbound destination for car hire for Arab nationals travelling on holiday, but Australia, New Zealand and the US are beginning to catch up.

In terms of intra-regional traffic, most customers shop at car rental kiosks at the airport when they arrive in their destination, rather than pre booking through a travel agent or booking online, according to some car rental companies.

Customers coming from further a field to the UAE now face the added complication of having to produce an international driving license on arrival if they wish to hire a car.

Following is a roundup of some of the leading players that are driving growth in the region.

Holiday autos

Holiday Autos Middle East has spent the last 12 months working on a series of trade and consumer promotions that have made the brand a household name. Holiday Autos has attempted to put the love back into driving with its Summer of Love Campaign, with special incentives for agents.

Naz Musa, MD, Holiday Autos Middle East:

Inbound trends: With the imminent arrival of road tolls in the UAE, it's a question of letting people know and giving them the information. It's the same as in London when the congestion charge was enforced. Suppliers told you they would charge you any fines that you did not pay.

Outbound trends: Popular outbound destinations are the UK, South Africa, Australia, France, and Germany. There is much more growth in the US, but from a small base. People are realising that cars are easy to pre-book and agents are realising they can earn up to 15% commission. On a $500 rental that's $75, which is more than they might get for their airline seat.

Agents: Sales through agents are increasing, driven by the fact that airline commissions are diminishing. Some of our consumer promotions have driven business through agents, which helps.

Tips:

• Sell the Holiday Autos' ‘Summer of Love' special offer. For every day's car rental agents earn AED 5 (US $1.4), and the money goes direct to the counter staff. If they rent an average car out for 10 days, that adds AED 50 ($14) to their pocket. If they make a booking per day - that's AED 250 ($68) a week, which is AED 1000 ($272) per month. That could be 25% of their salary again every month.

Industry evolution: Pre-booked, inter-company affiliations and onlinebookings.

Avis

Avis is present in 10 countries in the region through licensees, primarily in Saudi Arabia, the UAE, Qatar and Bahrain. In the UAE and Saudi Arabia, the company's main focus is corporate business, while in Qatar it is mainly corporate driven. The company reported year-on-year growth of 30% in the region last year. Intra-regional bookings growth hit 90% last year.

Thierry Domballe, regional director - Mediterranean & the Middle East, Avis:

Trends: We pay a lot of attention to inbound business, but now I want to make sure we focus on intra-regional and outbound growth. Outbound [growth] was about 20% last year and the key countries for outbound sales were France and the United States. About 20-25% of business comes in through the travel trade, depending on the country.

Agents: It's the responsibility of the licensee in each country to train the travel trade and my challenge is to make sure they can talk to each and every one of our partners to make sure we are getting penetration in the industry.

Regional expansion plans: Avis opens an office in Yemen on July 10 where business will be corporate driven and there are big prospects in terms of the gas industry. We are looking at controlled growth and alliances are very important to us.

New initiatives: We are considering specific packages for ex-pats travelling back to their home countries for three or four weeks in the summer. Tactical campaigns are a way to differentiate ourselves, but they won't necessarily be on price.

Dollar Thrifty Automotive Group (DTAG)

Dollar Thrifty Automotive Group boasts a 12,000-vehicle strong fleet in the United Arab Emirates and has 14 sales outlets, making it the largest car hire firm in the UAE in terms of presence. The company can be clearly separated into its two major businesses; Dollar Rent A Car and Thrifty. Dollar is a 50/50 mix of leisure and corporate, with franchises throughout the Middle East. Its UAE fleet is set to reach 3000 vehicles by the end of 2007 - a 40% growth for the year. Thrifty is focused, more on the corporate customer, particularly in the UAE, but does some leisure business.

Print | Email | Discuss this article

| Share |

READERS' COMMENTS

Click here to post a comment

Add your Comment All posts are sent to the administrator for review and are published only after approval. ArabianBusiness.com reserves the right to remove any comment at any time for any reason. Please keep your responses appropriate and on topic. Arabian Business would like to point out that only comments relevant to the story will be published. Any containing personal insults or inappropriate language will not be approved.
Name *
Remember me on this computer
Email *	(Your email address will not be published)
City
Country
Subject *
Comment *
Notify me of further comments
Enter the words above *
Please click post only once - your comment will not be published immediately.

MORE FROM ARABIANBUSINESS.COM