Avis 2013 Annual Report Download - page 14

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In 2002, Cendant acquired the Budget brand and Budget vehicle rental operations in North America, Australia and
New Zealand. Budget was founded in 1958 as a car rental company for the value-conscious vehicle rental
customer and grew its business rapidly during the 1960s, expanding its rental car offerings throughout North
America and significantly expanding its Budget truck rental business in the 1990s.
In 2006, Cendant completed the sales and spin-offs of several significant subsidiaries and changed its name to
Avis Budget Group, Inc. In 2011, we expanded our international operations with the acquisition of Avis Europe,
which was previously an independently-owned licensee operating the Avis and Budget brands in Europe, the
Middle East and Africa, and the Avis brand in Asia. Upon the completion of the acquisition of Avis Europe, the Avis
and Budget brands were globally re-united under a single company, making Avis Budget Group one of the largest
vehicle rental companies in the world.
In 2013, we acquired Zipcar, the world’s leading car sharing company, and further increased our growth potential
and our ability to better serve a greater variety of our customers’ transportation needs. In 2012 and 2013, we also
acquired our Apex and Payless brands, which allowed us to expand our presence in the deep-value segment of
the car rental industry.
We have a long history of innovation in the vehicle rental and car sharing business, including the 1973 launch of
our proprietary Wizard system, a constantly updated information-technology system that is the backbone of our
operations. In 1987, we introduced the Roving Rapid Return, powered by a handheld computer device that
allowed customers to bypass the car return counter, and in 1996, we became one of the first car rental companies
to accept online reservations. In 2000, we introduced Avis Interactive, the first Internet-based reporting system in
the car rental industry. In 2009, we launched what we believe to be the first car rental iPhone application in the
United States, and in 2012, we believe that our Avis brand became the first in the industry to offer mobile
applications to its customers on all four major mobile platforms — Android, BlackBerry, iPhone and Microsoft
Windows. Our Zipcar operations have been a constantly innovating pioneer in using advanced vehicle
technologies as the first car sharing company in the United States to develop a self-service solution to managing
the complex interactions of real-time, location-based activities inherent in a large-scale car sharing operation,
including new member application, reservations and keyless vehicle access, fleet management and member
management, and the first to allow members to reserve the specific make, model, type and color of their car by
phone, Internet or wireless mobile device.
Since becoming an independent vehicle rental services company in 2006, we have focused on strengthening our
brands, our operations, our competitiveness and our profitability. In conjunction with these efforts, we have
implemented process improvements impacting virtually all areas of the business; realized significant cost savings
through the integration of Avis Europe and Zipcar with our pre-existing operations; achieved reductions in
operating and selling, general and administrative expenses, including significant reductions in staff; assessed
location, segment and customer profitability to address less-profitable aspects of our business; implemented price
increases and changes to our sales, marketing and affinity programs to improve profitability; and sought to better
optimize our acquisition, deployment and disposition of fleet in order to lower costs and better meet customer
demand.
SEGMENT INFORMATION
We categorize our operations into three reporting segments:
• North America, provides car rentals in the United States and vehicle rentals in Canada, as well as
ancillary products and services, and operates the Company’s Zipcar car sharing business;
• International, provides and licenses the Company’s brands to third parties for vehicle rentals and ancillary
products and services primarily in Europe, the Middle East, Africa, Asia, South America, Central America,
the Caribbean, Australia and New Zealand; and
• Truck Rental, provides truck rentals and ancillary products and services to consumers and commercial
users in the United States.