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World car rental history

World car rental history

A hundred years ago, almost simultaneously in Europe and the United States, the idea of giving your car to everyone for temporary use appeared. There are several contenders for the title of the pioneer of this business, thanks to which today in Ukraine, as well as throughout the world, everyone can rent the right vehicle for their own purposes. Experts believe that one of the main driving factors for the development of services is the high demand for cars, which even mass production could not satisfy.

Not without women: a merchant was catastrophically late for a date, and a local mechanic did the neighbor a favor – gave his car for use, having previously attached the odometer to the front left wheel.

Joe Sanders – the first car rental in history

The entrepreneurial mechanic's name was Joe Sanders, and the first rental car was the Ford Model T. Due to the low price of 10 cents per mile (about 1.6 km), which with an average salary of about $ 50, there were very few people who wanted to use the service that after six months the car park consisted of 18 Fords (the price of each in 1917 was 350 dollars). The entrepreneur founded the first car rental company, Sanders System. and worked at first only in the state of Nebraska. However, due to the growing demand, the opening of small branches of the company in 20 states (56 cities) of the USA soon followed.

The business grew so rapidly that Sanders could open branches all over America and earn billions of dollars, but the Great Depression of 1929-1933 struck. The promising company did not survive the fall in demand and went bankrupt.

Jacobs, Hertz and Martin Sixt

The main American rival and follower of Sanders was a young Chicago businessman, Walter Jacobs. In 1918, he opened his 12-car rental Ford, which focused on troubleshooting and inspecting the garages he owned. It took the businessman only 5 years to earn a million dollars by the age of 22.

At the pinnacle of success in 1923, Jacobs sold the thriving business to John Hertz, the owner of the shipping firm. Later Hertz changed several owners, but until 1968 Walter Jacobs was the permanent president of the company. It was he who proposed to place rental offices at train stations and airports, and later introduced payment for services by bank cards. Largely thanks to Jacobs 'The Hertz Corporation' remains among the main players in this market segment.

Interestingly, the very first firm was the European Sixt, opened in 1912 by Munich's Martin Sixt. Initially, they rented exclusively German cars, but now the network covers 105 countries, with 4,500 rental points and a gigantic fleet of over 220,000 cars.

Car rental boom

After the end of World War II, a rapid economic growth and tourism growth began, justified by a breakthrough in air travel. People were seized with a thirst for new experiences and discoveries, which means that the demand for the services of car rental companies has grown again.

On the 'post-war' Several firms appeared in the wave. The largest and still operating of them was the American Avis, founded by retired military pilot Warren Avis in 1946. He started his business in a small airport in the provincial town of Ypsilanti (Michigan), having only three cars at his disposal. However, after 7 years, the company became the second largest in the United States, and its offices were in all major cities. It took the company only three years to open its branches in both the Americas and Europe, and now it has representative offices in 165 countries (more than 5,700 rental points).

Around the same time, they started their work:

  • Enterprise – 1957;
  • National – 1947;
  • Europcar – 1949;
  • Alamo – 1974;
  • Thrifti – 1958.

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Domestic car rental

Nikita Khrushchev is considered to be the author of a large-scale project for the introduction of rental offices. It was he who, in mid-1956, proposed opening the first car rental points in the USSR in order to eliminate the lack of vehicles on the service market. In the First rental point (Moscow, 1956) there were 80 cars, by 1962 such offices had appeared in 40 cities of the country. Basically, they were equipped with Volga, Victory and Muscovites . Citizens could rent a car for a period of 1 hour – 1 month. Unfortunately, after the resignation of Khrushchev, they were closed in 1964.

Before restructuring car rental in Kiev or other cities remained a dream, but in the 90s the vacant niche was occupied by large foreign players, and a little later Ukrainian firms appeared. For a long time, only very wealthy people could use the rental services, but now it is affordable for any Ukrainian to take a car, for example, in NarsCars.

What now?

Today, more than half of the Ukrainian car rental market is controlled by three large foreign companies, with the main share (26%) owned by Sixt. The rest of the seats are distributed among local firms, which cannot yet boast of large fleets and such a high level of service.

However, experts say that the main trend is the interest of customers in national distributors, which is associated with a high level of services, numerous promotions and lower prices for cars (on average, the cost of cars of similar classes from local firms is 20-30% lower). In addition, local car rentals offer weekend rates and seasonal discounts, making car rental very affordable. Therefore, it is not surprising that according to statistics, about 70% of clients are citizens of Ukraine.

Often, our firms have a large selection of models, even with a relatively small fleet of vehicles, since from 70 to 90% of cars in international companies are already reserved by foreign tourists. Economy and middle class cars, SUVs (for winter travel) are especially popular.

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