THE British love affair with Spain has made the destination one of the most lucrative for car-rental companies for many years.
The big four players have a strong presence in the country: Avis has 220 rental locations; Hertz has 120; and Budget just over 40. Europcar has more than 220 rental locations and a fleet of 22,000 cars.
Demand for vehicles is particularly strong in resorts popular with the British market as those on beach holidays tend to head inland to explore for a few days.
Malaga alone made up 11% of Suncars’ business last summer, with the Canaries, Balearics and Alicante accounting for around 18%.
The size of the rental market to Spain, including the Canaries and the Balearics, is difficult to estimate because official statistics are not collected and car-rental companies are loathe to give away booking figures.
As a rough guide, Avis head of travel sales Tom Knopek believes his company is market leader in Spain with around 800,000 rentals a year, or 40% of the market. That figure takes in leisure and business rentals prebooked or booked locally by all nationals including the Spanish domestic market.
For pure leisure rentals, Suncars general manager John Briggs believes Holiday Autos is the market leader, with Avis and Suncars close behind, and Hertz in fourth place.
Market figures are also clouded by the large number of Britons who wait to get to the resort before they book.
Many people booking beach holidays know in advance they want a hire car but do not know which days they will want it. In addition, holidaymakers arefamiliar with Spain and comfortable about renting on the spot.
They are also familiar with the vehicles on offer. For instance, Budget’s fleet in Spain includes Renault, Ford and General Motors’ cars. Other operators feature Fiats and Spanish-made Seats.
CarPass general manager Larry Dale Ursich estimates around 60% of those going to Spain rent their car in resort, which he said equates to 4m car rental days lost to the travel trade.
To try to capture some of this market, his company launched a pre-purchase voucher scheme last June. Clients can buy vouchers in advance from their agent – who earns commission – and exchange them in resort. Each voucher is valid for a day’s rental and costs £25. Suncars has a similar voucher scheme, while Avis sells a lot of rental in resort through tour operators’ reps.
Knopek said: “The volume of car rental booked locally is phenomenal, so there is no doubt there is a desire for the service. But we would rather they pre-book as it is easier to manage the stock.”
The huge demand for car rental in Spain, combined with the vast number of outlets, including thousands of local companies, keeps competition high and rental rates very low.
Both Holiday Autos and Suncars have rates from £69 for one week’s winter rental in Malaga, which works out at less than £10 a day, while Hertz quotes £104 for one week in summer. That compares with £125 in Portugal, which is also a major rental market for the British.
Hertz vice-president leisure sales and marketing Bill Jones said: “Prices are artificially low because of the competition, which makes it great value for British visitors.”
Apart from price, operators agree one of the big incentives for hiring in Spain is the opportunity to see so much, so easily. Budget vice-president sales and marketing Roeland Moens said: “The road infrastructure is good, the locals do not have any ‘unusual’ driving habits and there is a lot to see. A lot of people combine a beach holiday with sightseeing in a rental car.”