Thrifty Goes Corporate, Alamo Eyes Leisure

<B> Thrifty Goes Corporate, Alamo Eyes Leisure</B>

By Lynn Woods

Three years ago, executives at Alamo Rent-A-Car were busy repositioning the company to snare the lucrative small-business market. They launched an upgraded express-rental product and a loyalty program. But with the recent closure of 24 Alamo locations, most in secondary business cities like Oakland, Calif., Richmond, Va., and Rochester, N.Y., and the elimination of the True Blue frequent renter program earlier this year, all that has changed.

Alamo--which some analysts have characterized as an unwanted stepchild at Republic Industries, its parent company, which also owns National Car Rental--now is returning to its roots as a price-sensitive, leisure-oriented company.

Over the next two years, Alamo will revamp its rental locations with the leisure traveler more in mind. Planned changes include adding play centers for children, packing areas in which luggage-laden leisure renters can organize their gear and "Drive Happy Guides" listing local events. Not surprisingly, the locations that are slated to undergo changes are the heavy leisure destinations of Las Vegas, Los Angeles, Maui, Miami and Orlando. In its expansion overseas, Alamo is focusing exclusively on leisure destinations, including the Caribbean and top vacation destinations in Europe.

But one of Alamo's major competitors, Thrifty Car Rental, seems to be headed in the opposite direction. Thrifty has embarked on an ambitious expansion of its franchise system, opening 59 new U.S. locations since August. Eighteen of these are on-airport. Earlier this year, Thrifty opened on-airport locations in Boston, Cleveland, Columbus, Los Angeles and Reno. Its fleet has been expanded by 4,000 vehicles to reach a total of 50,000 cars.

"We have double-digit growth in our corporate business," said Bob Thunnel, vice president of corporate and travel industry sales. "As companies tighten their belts and look at our express service, doors are opening for us." Thunnel attributed the growth to several factors, including the changing dynamic at airports. "In the past, there were five spots for car rental companies at airports, but now there are six or seven," he noted. Most licensees have seized this new opportunity to go in-terminal.

Another factor is consolidation in the industry. As the major car rental firms buy up their franchisees--Budget Rent a Car and Avis have been particularly active in this respect--independent operators find themselves without a job. "This has caused the independent person or franchisee to come running to us," said Thrifty spokesperson Meloyde Blancett-Scott. "We are the only alternative out there for the smaller independents."

Well, not the only one. Another beneficiary of this trend is Payless Car Rental, which added 13 new franchisees in the month of September.

Thrifty has taken some steps to try to shore up its position in the corporate sector. Last year, it launched its Blue Chip express-rental program, whose success has "exceeded our expectations," said Thunnel. And in September, Thrifty introduced a "satisfaction guarantee" promising customers with a legitimate gripe a free rental day.

Another factor that Thrifty touts as a benefit is "100 percent participation in the corporate account program" by its franchisees, a compliance standard that is unmatched by its competitors, Thunnel said.

Yet another selling point is Thrifty's decision to hold the line on expensive city surcharges. To date, it levies them at only two cities, Chicago and New York. "Our goal is to triple our corporate business in five years," concluded Thunnel.