Thrifty Car Rental 2009 Annual Report Download - page 17

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Fleet Leasing Programs
DTG Operations has historically made fleet leasing programs available to Dollar and Thrifty U.S. and
Canadian franchisees for each new model year. For the 2009 model year, this program was offered to
franchisees on a limited basis due to constrained financing capacity and instability in the credit markets.
For the 2010 model year, fleet leasing will again be offered on a limited basis to U.S. and Canadian
franchisees.
U.S. Fleet Data
2009 2008 2007
DTG
Average number of vehicles leased to
franchisees 1,666 2,754 4,309
Average number of vehicles in
combined fleets of franchisees 15,382 18,171 22,696
Average number of vehicles in combined
fleets of company-owned stores 99,223 115,129 117,488
Total 114,605 133,300 140,184
Year Ended December 31,
Competition
There is intense competition in the vehicle rental industry on the basis of price, service levels, vehicle
quality, vehicle availability and the convenience and condition of rental locations. Dollar and Thrifty and
their franchisees operate mainly in the U.S. airport market, relying on leisure, tour and small business
customers. In addition to local and regional vehicle rental companies, Dollar and Thrifty and their
franchisees’ principal competitors are Alamo, Avis, Budget, Enterprise, Hertz and National.
The Canadian vehicle rental markets are also intensely competitive. Most of the Canadian market is
operated either directly or through franchisees of the major U.S. vehicle rental companies, including
Alamo, Avis, Budget, Enterprise, Hertz and National, as well as Dollar and Thrifty.
Insurance
The Company is subject to third-party bodily injury liability and property damage claims resulting from
accidents involving its rental vehicles. In 2007, the Company retained the risk of loss up to $4.0 million
per occurrence for public liability and property damage claims, plus a self-insured corridor of $1.0 million
per occurrence for losses in excess of $4.0 million with an aggregate limit of $7.0 million for losses within
this corridor. In February 2008, the Company increased its retained risk of loss up to $5.0 million per
occurrence and in February 2009, the Company further increased its retained risk of loss up to $7.5
million per occurrence for public liability and property damage claims, including third-party bodily injury
and property damage. The Company maintains insurance coverages at certain amounts in excess of its
retained risk. The Company retains the risk of loss on supplemental liability insurance sold to vehicle
rental customers.
The Company retains risk of loss up to $5.0 million for general and garage liability. The Company retains
the risk of loss for any catastrophic and comprehensive damage to its vehicles. In addition, the Company
carries workers' compensation coverage with retentions in various amounts up to $500,000. The
Company also carries excess liability and directors' and officers' liability insurance coverage.
Provisions for bodily injury liability and property damage liability on self-insured claims and for
supplemental liability insurance claims (collectively referred to as “Vehicle Insurance Reserves”) are
made by charges to expense based upon periodic actuarial evaluations of estimated ultimate liabilities on
reported and unreported claims. As of December 31, 2009, the Company had Vehicle Insurance
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