Sixt, the largest car hire operator in Germany, has started to implement its plans for a franchise network to be developed in the US. The company launched its Sixt brand in the country last year, and these operations are making a decent contribution to its finances as it has been expanded. Now the operator will acquire franchise partners in several states to continue expanding in the US market and reinforce its brand’s position. This is all part of the company’s international expansion strategy, which is the focus of most of its activities as of late.
Sixt has been expanding in the US since the spring of 2011, when its first car hire office was opened in Florida. Now the company has five locations across the state – two in Miami and one each in Orlando, West Palm Beach and Fort Lauderdale. On top of this, the operator as branched out to other states, opening offices in Atlanta, Georgia and Phoenix, Arizona. Both of these cities are major transport hubs in the US.
Now Sixt has contacted more than 100 potential franchises across nearly every state in the country. The operator has had a clear, geographical focus on major tourist destinations and economically vital areas. It’s possible the first independent rental businesses with their own fleets and requisite level of services could begin as franchisees for the company before the year’s end.
Sixt Franchise USA vice president Craig A. Olson says that independent, growth-minded local businesspeople and car hire operators now have a unique chance to join the company’s successful international franchise system early in their drive to expand in the US. They will be able to grow fast by working with Sixt, which makes progress.
Sixt AG chief executive Erich Sixt says that cooperating with local franchise partners has been a key part of their expansion overseas for many years. Forming a franchise network in the US market (which he describes as hugely important) has a big role in these plans. They are able to begin pursuing this strategic objective just one year after debuting in the market because of their successful progress and the great amount of interest potential franchisees have shown. The company has quickly made a name for itself in the country.
According to Hotwire.com chief executive Clem Bason, car hire rates have been declining over the past three or four years. He expects this trend to make a U-turn, however, and believes consumers will only avoid increased prices if Sixt changes the market with ultra-low prices, which he has seen in Florida already. He noted that the company was selling rentals in Orlando for just $7 per day.
Prices like this will be sorely appreciated by experts and consumers alike, as many are concerned that Hertz’s acquisition of Dollar Thrifty will send prices through the roof. Consolidation in the US car hire market has meant that there are only three major operators left. However, if Sixt continues to expand and gain market share, it very well could be sitting pretty with these companies. The brand is already very popular overseas, so there’s no reason why its popularity wouldn’t continue growing in the US. Plus, if its prices stay low to compete with the major operators, prices could even drop some as the major businesses try to match them.