Strengthening the field of car rental contract analysis, and breaking into yet-unexplored fleet leasing analysis, Rosenbluth International's subsidiary Eclipse Advisors last month partnered with Purchase, N.Y.-based Abrams Consulting Group.
The joint venture, eAAbrams Travel Management Solutions, will provide travel managers with car rental and fleet management services, including benchmarking, tracking and cost-reduction capabilities using Eclipse's DacodaGT product. The partnership also will provide industry trend reports and offer its services to travel management companies and suppliers.
Abrams, which is the only consultancy that specializes in car rental, will serve as the consulting and negotiating arm for Eclipse, whose DacodaGT car rental sourcing tool focuses on service offerings and needs for a one- or two-year contract and advertises corporate savings of 10 percent.
However, other companies already vie for the opportunity to provide car rental analysis, including Navigant's Professional Services Group consulting division, WorldTravel BTI's Travel Procurement Solutions and Travel Analytics, which provides car rental analysis upon request.
Eclipse and Abrams last month also released a survey of 50 Fortune 1,000 corporate travel managers that was conducted in April. Thirty percent of the survey respondents said their car rental budget has increased in recent years, while only 24 percent have an international rental contract with suppliers. The survey also found that 25 percent of buyers now are responsible for fleet leasing.
As opposed to car rental, the savings available in fleet management is more difficult to determine, given the unchartered waters and because, according to president of Abrams Consulting Neil Abrams, fleet is a "larger and deeper industry."
"We looked at Eclipse's technology and what it does," Abrams said. "Then we stepped back and said, 'There's no reason why we couldn't adapt this for the fleet leasing industry.' " Abrams called travel managers' understanding of fleet leasing "absolutely foreign. It's very simplistic to say it's a long-term car rental" when additional considerations include insurance, license, title and used car remarketing. "You're looking at about 10 car services. Leasing is only half of the activity." Dominant fleet management suppliers include GE Capital and Cendant's PHH.
The new venture also will conduct traveler satisfaction surveys—on topics ranging from air and hotel to wireless and payment systems—and distribute a version of Abrams' quarterly Market Scan industry analysis report tailored toward travel management.
According to Abrams, "If there are certain issues, a company can bring that to the deal and leverage toward fulfilling those issues."
While approximately half of those polled in the April survey spend $2 million or less annually on domestic and international car rental, analysis of company spend on limousine services remains a future goal for the partners.
"We are currently talking about the total transportation line and looking at limo and making sure there is an opportunity," said Heather Guyon, general manager of Dacoda strategies.
Given its still-marginal slice of the T&E pie, not all agree that car rental requires such sophisticated software.
"It's overkill. The car rental sourcing process is very straightforward, very simple and it requires far less monitoring than any other category because the suppliers have really good data," said Travel Analytics principal/CEO Scott Gillespie. "The pricing structure is not terribly complex and suppliers don't pressure companies toward contract performance goals. Nothing says this is a tough nut to crack."
In the area of fleet management, however, Gillespie said, "There sounds like a potential for value-add."
Perhaps the partnership is simply answering a new desire among corporate travel managers and their supervisors to see the true numbers behind each level of spend.
"This profession has become more sophisticated and analytical, and there is definitely more of a clamor for data," according to Jon LeSage, Abrams Travel Data Services vice president and director of research. However, the procurement-oriented focus of corporations also threatens to dilute the negotiation process with people less familiar with car rental and fleet management, he said.
"We see contract compliance as the emerging trend, and compliance is the employee's obligation to use certain vendors but it's also the vendors' promise to perform the services," LeSage said.
The small pool of major suppliers, as well as the financial straits of some, may appear to leave limited choices for buyers, but Guyon said Eclipse reminds corporations of the stronger programs now available through Enterprise, Thrifty or Dollar.
The effort so far has met with limited success, she said. Companies simply are not as open to using smaller car rental firms because of their lack of extensive networks.