Hertz 2010 Annual Report Download - page 30

ITEM 1. BUSINESS (Continued)
For further information on our business segments, including financial information for the years ended
December 31, 2010, 2009 and 2008, see Note 10 to the Notes to our consolidated financial statements
included in this Annual Report under the caption ‘‘Item 8—Financial Statements and Supplementary
Data.’’
Worldwide Car Rental
Operations
We rent a wide variety of makes and models of cars. We generally accept reservations only for a class of
vehicles, although we accept reservations for specific makes and models of vehicles in our Prestige
Collection national-scale luxury rental program, our Hertz Fun Collection experiential rental program, our
Green Collection environmentally friendly rental program and a limited number of models in
high-volume, leisure-oriented destinations. We rent cars on an hourly (in select markets), daily,
weekend, weekly, monthly or multi-month basis, with rental charges computed on a limited or unlimited
mileage rate, or on a time rate plus a mileage charge. Our rates vary at different locations depending on
local market conditions and other competitive and cost factors. While cars are usually returned to the
locations from which they are rented, we also allow one-way rentals from and to certain locations. In
addition to car rentals and licensee fees, we generate revenues from reimbursements by customers of
airport concession fees and vehicle licensing costs, fueling charges, and charges for ancillary customer
products and services such as supplemental equipment (child seats and ski racks), loss or collision
damage waiver, theft protection, liability and personal accident/effects insurance coverage, Hertz
NeverLost navigation systems and satellite radio services.
Our international car rental operations have company-operated locations in France, Germany, Italy,
Australia, the United Kingdom, Spain, Canada, Brazil, The Netherlands, Switzerland, New Zealand,
Belgium, Puerto Rico, China, the Czech Republic, the Slovak Republic, Luxembourg and the U.S. Virgin
Islands.
As of December 31, 2010, we had 2,360 staffed rental locations in the United States, of which
approximately one-fifth were airport locations and four-fifths were off-airport locations, and we regularly
rent cars from approximately 1,340 other locations that are not staffed. As of December 31, 2010, we had
approximately 1,120 staffed rental locations internationally, of which approximately one-fifth were airport
locations and four-fifths were off-airport locations, and we regularly rent cars from approximately 120
other locations that are not staffed. We believe that our extensive U.S. and international network of
company-operated locations contributes to the consistency of our service, cost control, fleet utilization,
yield management, competitive pricing and ability to offer one-way rentals.
In order to operate airport rental locations, we have obtained concessions or similar leasing, licensing or
permitting agreements or arrangements, or ‘‘concessions,’’ granting us the right to conduct a car rental
business at all major, and many other airports in each country where we have company-operated rental
locations, except for airports where our licensees operate rental locations. Our concessions were
obtained from the airports’ operators, which are typically governmental bodies or authorities, following
either negotiation or bidding for the right to operate a car rental business there. The terms of an airport
concession typically require us to pay the airport’s operator concession fees based upon a specified
percentage of the revenues we generate at the airport, subject to a minimum annual guarantee. Under
most concessions, we must also pay fixed rent for terminal counters or other leased properties and
facilities. Most concessions are for a fixed length of time, while others create operating rights and
payment obligations that are terminable at any time.
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