Enterprise Exec Says Acquisition Has Come a Long Way Featured

By Jeffrey Bellant March 27, 2018

 

 

LAS VEGAS – Enterprise Rent-A-Car has come a long way from its modest start as a leasing company in 1957.

Kurt Kohler, senior vice president of fleet acquisition and remarketing for Enterprise Holdings, said the company would buy light-colored cars in the early days because they hid any scratches. Most would only come with base equipment.

“Then you’d figure out when to sell them, maybe around warranty time,” Kohler said. “But one thing we were forgetting is that this wasn’t the end of the life for these cars, it was the beginning. Someone was going to buy these cars.”

At one point, Enterprise began to realize that the rental cars swayed a customer’s decision on buying their next car.

As a result, the company hired HIS Markit for a study on why people are renting. On an annual basis, Enterprise customers are three times more likely to buy the car they rented, with 55 percent buying new cars.

“We also realized that 70 percent of the people that rented a vehicle had a more positive experience about the vehicle than they thought they would,” Kohler said.

Enterprise followed by talking to their partners, showing them what it learned.

The company also includes a section on its national app allowing customers to rate the rental car and Enterprise shares that with the manufacturer.

Enterprise will do target marketing, allowing manufacturer to offer free rentals, Kohler added.

Another study on the residual side of the business showed a change from the days that a rental car hurt the value of the remarketed unit.

“People are excited about renting these cars because the 11-year-old car (that they own) doesn’t really stack up,” Kohler said.

Enterprise has been stocking its fleet with much better equipped vehicles in the past decade. As a result, more customers are looking to buy a former rental car.

Rentals have a lot more safety features, as well as high-trim packages and really good maintenance, Kohler said.

“We are better than most car enthusiasts at maintenance,” he said.

Enterprise also surveyed dealers who said they liked the convenience of buying cars from the company. Enterprise also makes a better effort to sell its cars going into online sales to make it easier for dealers.

Convenience was the top reason and the relationship was second. Price also played a part.

Kohler praised the auctions for their help in remarketing their vehicles, even when rental companies didn’t do the best job in the past.

It’s no longer a matter of selling a vehicle at warranty, Kohler said.

Last modified on Tuesday, 27 March 2018 20:46

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