With new branches in South Africa, Botswana and Zimbabwe, Hertz Rent a Car clearly believes that southern Africa has the market potential for its product. Wils Raubenheimer, CEO of Hertz Rent a Car’s southern African operations, took some time answer a few questions about the company’s expansions and new product offerings.
Q: What changes have been made to Hertz’s South African operation in the last year?
A: Hertz has opened a number of new locations and also grown our fleet quite considerably in order to provide a consistent and improved service to our clients. We’ve improved a lot of our business processes, invested time and money in technology and also in training and people development. Our Jet Park depot opened in November last year, which houses Hertz’s new Gauteng turnaround facility enabling us to keep pace with our increased fleet. Double the size of the previous facility, it incorporates technologically-advanced electronic support systems and processes designed to enhance and expedite throughput.
Q: Why should corporate customers consider Hertz’s 30 Thirty Plus programme?
A: Hertz’s 30Thirty Plus value-add programme was launched in response to the increasing demand for affordably priced, longer term rentals in the South African market. For corporates with individuals coming to SA on contract work or for an extended period, for example, 30Thirty Plus makes sense. No need to up-fleet, incur vehicle finance costs, registration, licensing, insurance, FICA and so on. An added bonus is that when the vehicle is in for service, mechanical repair or in the event of an accident, a replacement vehicle is part of the offering. The only requisite is that payments are made by credit card (corporate or personal) monthly in advance. The product has been tailored and priced for a niche market. A 30 days or more rolling rental plan, it offers flexibility in favour of the renter with early termination of the agreement carrying no penalty.
Q: How popular is your chauffeur drive product with your corporate customers?
A: Hertz’s chauffeur drive and transfer services are going from strength-to-strength. Having recently being awarded a major tender, this is a core focus for us right now. We have doubled our fleet by adding more luxury models to cater for this increased demand.
Q: Are you seeing much of an uptake in the luxury car category?
A: Yes we are and based on this, we are expanding significantly in this group and in the process of adding even more luxury vehicle models to our fleet.
Q: Further down the group spectrum, what is your most popular car and group?
A: Group B is undoubtedly the most popular and provides great value for our customers.
Q: What impact has the fuel price had on your business in 2015?
A: While the bulk of the fuel costs incurred are charged to our customers, like any other business, when it comes to non-rev rentals and deliveries for example, the fuel price certainly impacts our company.
Q: What are your thoughts on the latest developments in the Johannesburg e-tolls saga?
A: Developments in this arena remain challenging and continue to have a significant impact on our business from a cash flow and resource perspective.
Q: What’s the greatest challenge facing your industry in South Africa?
A: Declining inbound tourism numbers a significant challenge for this industry. While ongoing power outages are impacting our efficiencies and ability to operate at optimum levels, the condition of our roads is resulting in excessive damages. The weak Rand is a double-edged sword. While it has a significant impact on our input costs, to a lesser extent, this is offset by South Africa becoming a cheaper travel destination.
Q: What prompted Hertz to recently open a branch in Botswana, and how have the first few months gone?
A: Hertz is constantly looking at extending its reach in southern Africa; this is part of the natural growing process. In conjunction with Hertz International, it was decided to expand our presence with Zimbabwe and Botswana being the first phase of that expansion process. With South Africa being the springboard into southern Africa, a large number of our existing corporate clients travel to these two countries. In Botswana we came across the opportunity to purchase an existing car rental business with infrastructure in Botswana and we are satisfied with our first three months of trading there.
Q:What vehicles are proving popular in Botswana?
A: Not surprisingly, our 4×4 double cabs.
Q: What are your plans for expansion into Zimbabwe?
A: Hertz opened in Zimbabwe in mid-2014 and we’ve recently relocated our Harare operation to Harare International Airport with our fleet mix currently comprising Groups T, B, E and D. Having sourced a suitable location in Victoria Falls, we’re on track to open a branch there later this month. With a $150 million expansion programme underway at Victoria Falls International Airport, the new facility will be able to accommodate more than three times the number of passengers. In general terms, Zimbabwe is going through a difficult phase and we’re giving them all the back-up support from South Africa that we can.
Q: Any other African countries on your radar?
Yes. We are constantly looking at expanding our footprint and opportunities are evaluated on an ongoing basis.