Both Avis Budget Group and Hertz reported revenue and pricing growth year over year for the fourth quarter, though that has not translated to higher rates for large corporate accounts.
Avis Budget's revenue rose 2 percent year over year in the quarter to $2.1 billion, and revenue per day increased 2 percent in the Americas. Avis Budget Americas president Joe Ferraro said the pricing increase in the quarter was the highest year-over year increase since 2014. The pricing environment in Europe, however, proved more difficult, and revenue per day for Avis Budget's business outside the Americas decreased 5 percent year over year.
Hertz, meanwhile, reported a 10 percent increase in revenue in the quarter to $2.3 billion. Revenue per day in the U.S. rose 4 percent, up 6 percent when taking ancillary revenue out of the equation, and pricing was flat outside of the U.S.
Executives from both car rental companies said corporate rental demand has grown, as well. Growth in corporate rental rates, however, has been slower. "If you look at the accounts we renewed in the quarter, I would say over 50 percent of them were renewed at higher rates but the large accounts are still under a lot of pressure, so the weighted average of the business is still not renewing at a positive-rate-per-day growth," Avis Budget CEO Larry De Shon said. "Small business [rates] continue to grow, as they are linked into the retail rates."
Hertz reported "stable" commercial pricing during the quarter.
Avis Budget reported a net income of $13 million, compared with $220 million in the fourth quarter of 2017, which included a $219 million income tax benefit. For the full year, its net income was $165 million, compared with $361 million in 2017.
Hertz reported a net loss of $101 million for the fourth quarter, compared with a net income of $616 million in the fourth quarter of 2017, which included a $795 million income tax benefit. For the full year, Hertz lost $225 million, compared with a net income of $327 million in 2017.
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