Chinese hire car expansion for Avis Europe

Avis Europe Plc has announced that it will be expanding its Chinese operations as the ongoing effects of the recession continue to drive the rental market in Europe to a standstill.

Avis Europe is the second largest rental organisation in Europe, and the new move into the Chinese market stands the carrier in good stead should the hire car industry ever boom in the country. Years of history and low wages have kept the Chinese rental market relatively quiet, although more open borders and reliable tourism destinations will hopefully see growth in the country. The potential for China to become a major car rental destination is huge, with millions of miles of road networks and attractions.

The announcement has revealed that Avis Europe will quadruple the number of rental depots in China. The group already manages 26 depots which account for 46 percent of the entire rental market operated by international hire companies. The present representation is via collaboration with the Shanghai Automotive Industry Corp and plans are to increase the number of rental outlets to over 100 over the next two years, leaving Avis Europe as the dominant industry force should the car hire market experience a much-hoped for boom in that time. The incumbent rental market in China remains very small.

Martyn Smith, the Finance Director for Avis Europe, acknowledges that his company is seeking greater presence in major Chinese cities but also in more remote destinations. With such a large population and driveable area, China could be the next big thing for car hire. The World Bank has predicted a 9 percent expansion of the Chinese economy this year, dwarfing the predictions for Europe that remain at just 1 percent.