Avis 2014 Annual Report Download - page 31

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Failure to provide a high-quality reservation and rental experience for our customers and members for any reason
could substantially harm our reputation and adversely impact our financial condition or results of operations.
We face risks related to our Zipcar operations.
We expect that the competitive environment for our car sharing services will become more intense as additional
companies enter our existing markets or try to expand their operations. Competitors could introduce new solutions
with competitive price and convenience characteristics or undertake more aggressive marketing campaigns than
we provide. Such developments could adversely impact our business and result of operations should we be
unable to compete with such efforts.
Because Zipcar members are located primarily in cities, we compete for limited parking locations that are
convenient to our members or are available on terms that are commercially reasonable to our business. If we are
unable to obtain and maintain a sufficient number of parking locations that are convenient to our members, our
ability to attract and retain members would suffer.
We expect to achieve significant benefits from integrating certain Zipcar operations, such as vehicle maintenance
and fleet procurement and disposition, with our existing infrastructure and by sharing fleet between Zipcar and our
other brands. To realize such benefits, we must successfully combine and integrate portions of our car rental and
car sharing operations in an efficient and effective manner. If we are unable to achieve these objectives within the
anticipated time frame, or at all, the anticipated benefits and cost savings of the acquisition may not be realized
fully, or at all, or may take longer to realize than expected.
We face risks related to political, economic and commercial instability in the countries in which we
operate.
Our global operations are dependent upon products manufactured, purchased and sold in the United States and
internationally, including in countries with political and economic instability. Operating and seeking to expand
business in a number of different regions and countries exposes us to a number of risks, including:
• multiple and potentially conflicting laws, regulations and policies that are subject to change;
• the imposition of currency restrictions, restrictions on repatriation of earnings or other restraints;
• local ownership or investment requirements, as well as difficulties in obtaining financing in foreign
countries for local operations;
• varying tax regimes, including consequences from changes in applicable tax laws;
• national and international conflict, including terrorist acts; and
• political and economic instability or civil unrest that may severely disrupt economic activity in affected
countries.
The occurrence of one or more of these events may adversely impact our financial condition or results of
operations. Our licensees’ vehicle rental operations may also be impacted by political, economic and commercial
instability, which in turn could impact the amount of royalty payments they make to us.
We face risks related to third-party distribution channels that we rely upon.
In 2014, we generated approximately 47% of our car rental reservations through third-party distribution channels,
which include:
• traditional and online travel agencies, airlines and hotel companies, marketing partners such as credit
card companies and membership organizations and other entities that help us attract customers; and
• global distribution systems, such as Amadeus, Galileo/Apollo, Sabre and Worldspan that connect travel
agents, travel service providers and corporations to our reservations systems.