Avis Budget car rental group fourth quarter losses

The car rental giant, Avis Budget Group Inc, has revealed their fourth quarter losses this week for the time ending 31st December 2009. They have improved greatly on what was expected and the margins were very narrow. The firm put the better results down to cost cutting measures and a good second hand car market for the latter part of the year. Although they started off better toward the end of this year they are predicting a not so good first quarter as the same time last year as people are still cautious in their spending habits.

Avis reported the fourth quarter to be $49 million, a huge improvement on last year’s $121 million. Their year-on-year revenue dropped by 9 per cent to $1.16 billion, largely due to the decrease in rental days, which was felt across the whole company. The cost cutting measure by the car rental company is looking good for the coming year and they are predicting that they can cut costs on their fleet units by six per cent and possibly saving up to $60 million in 2010.

This past 12-18 months has been one of the worst in the history of the car rental market, but they seem to have come out the other side fighting fit. Many of the major players in the market closed branches, cut back on cars, and restructured their companies to make it work. This coming year is already looking up in the hire car market and we can only wait and watch.