Hertz 2010 Annual Report Download - page 31

ITEM 1. BUSINESS (Continued)
The terms of our concessions typically do not forbid us from seeking, and in a few instances actually
require us to seek, reimbursement from customers of concession fees we pay; however, in certain
jurisdictions the law limits or forbids our doing so. Where we are required or permitted to seek such
reimbursement, it is our general practice to do so. The number of car rental concessions available at
airports varies considerably, but, except at small, regional airports, it is rarely less than four. Certain of
our concession agreements require the consent of the airport’s operator in connection with material
changes in our ownership. See ‘‘Item 1A—Risk Factors’’ in this Annual Report.
The Hertz brand is one of the most recognized brands in the world. Our customer surveys, in the United
States, indicate that Hertz is the car rental brand most associated with the highest quality service. This is
consistent with numerous published best-in class car rental awards that we have won, both in the United
States and internationally, over many years. We have sought to support our reputation for quality and
customer service in car rental through a variety of innovative service offerings, such as our customer
loyalty program (Hertz #1 Club), our global expedited rental program (Hertz #1 Club Gold), our one-way
rental program (Rent-it-Here/Leave-it-There), our national-scale luxury rental program (Prestige
Collection), our national-scale experiential rental program (Hertz Fun Collection), our environmentally
friendly rental program (Green Collection) and our in-car navigational services (Hertz NeverLost). We
intend to maintain our position as a premier company through an intense focus on service, quality and
product innovation.
In late 2008, we introduced Connect by Hertz, a new global car-sharing service, which rents cars by the
hour, at various locations in the U.S., Canada and Europe. In April 2009, we completed the acquisition of
Eileo, S.A.S., or ‘‘Eileo,’’ a Paris, France-based developer of car sharing technology. Eileo’s end-to-end
solutions are utilized by Connect by Hertz. Connect by Hertz allows customers to sign up for the service
and start renting cars by the hour. Customers pay an annual or monthly membership fee, pick up cars in
locations scattered around a city, at a university or a corporate campus without checking in at a Hertz
rental office, and then pay an hourly car-rental fee. Connect by Hertz fees include fuel, insurance, 24/7
roadside assistance, in-car customer service and 180 miles per day.
In April 2009, we completed the acquisition of certain assets of Advantage Rent A Car, or ‘‘Advantage.’’
Advantage is a popular brand for price-oriented customers at key U.S. leisure travel destinations. The
purchase agreement provided us with the rights to purchase certain rights, trademarks and copyrights
to use the Advantage brand name, website and phone numbers. In addition, the agreement provides us
with the option to have assigned to us certain leases, fixed assets, airport concession agreements and
other agreements associated with approximately 20 locations that Advantage is or previously was
operating. As of December 31, 2010, we had 46 corporate Advantage brand rental locations in the
United States and Europe and 14 affiliates in Latin America and the Carribean.
During the fourth quarter of 2010, we completed the acquisition of Flexicar, a leading Australian car
sharing company.
Beginning in December 2010, we made the next generation of electric vehicles available to the general
public through our Connect by Hertz car sharing operation. We plan to add additional electric vehicles to
our fleet over the coming months making electric vehicles available at locations in Manhattan,
Washington D.C. and San Francisco and we plan further deployment of electric vehicles and plug-in
hybrid electric vehicles in both the U.S. and other countries throughout 2011.
Based on the latest available data, in the United States, the Hertz brand had the highest market share, by
revenues, in 2009 and in the first nine months of 2010 at approximately 200 of the largest airports where
we have company-operated locations. Out of the approximately 170 major European airports at which
we have company-operated rental locations, data regarding car rental concessionaire activity for the
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