In an effort to streamline its operational activities as well
as enhance customer experience in Europe, the Middle East and
Avis Budget Group Inc
) recently announced the recruitment of approximately 150 staff
at its Business Support Center (BSC) in Budapest.
Last year in October, the company had employed 235 new
personnel at this facility. Moreover, the company expects the
expansion to help in generating significant cost savings by
The expansion will increase the total number of employees to
approximately 700 at BSC. Moreover, the company will have
personnel with communication skills in ten different languages.
Avis Budget had set up this facility in Jan 2004, and was the
first international company to have a regional service center in
The company has always tried to exploit other inbound revenue
opportunities by focusing on new ideas and investments in its
brands and technology upgradation. Since the acquisition of Avis
Europe in Oct 2011, the company remains on track with its
integration plans. Lately, Avis Budget has launched its own sales
force in the European region as a means to own and leverage the
local opportunities and customers to drive inbound business.
We believe that Avis Budget follows a core global strategy of
partnering with leading travel brands to expand its customer
reach while creating additional demand. The acquisition of Avis
Europe was one of the major steps taken by the company to enhance
its operational foothold in the global market.
Furthermore, Avis Budget recently entered into a multi-year
deal with Costco Travel. As per the deal, more than 45 million
Costco Wholesale Corporation
) members across the U.S. will be provided with savings on
vehicle rentals and supplementary products from Avis Car Rental
and Budget Car Rental.
The above-mentioned partnership will expectedly benefit both
Avis Budget and Costco Travel. For Avis Budget, the tie-up will
help increase its customer base and aid in top-line growth. For
Costco, the deal will help in providing its members high quality
services and enhanced savings through Avis Budget.
Further, we remain impressed with Avis Budget's sustained
focus on productivity and cost containment initiatives, which in
our view, would help the company achieve its goal of higher
However, significant exposure to foreign currency translations
and heavy dependency on third-party distribution channels remain
causes of concern. Moreover, due to intense competition from
other established players such as
Hertz Global Holdings Inc
United Rentals, Inc
), the company may find it challenging to maintain the same level
of operating performance.
Avis Budget currently carries a Zacks Rank #4 (Sell).
AVIS BUDGET GRP (CAR): Free Stock Analysis
COSTCO WHOLE CP (COST): Free Stock Analysis
HERTZ GLBL HLDG (HTZ): Free Stock Analysis
UTD RENTALS INC (URI): Free Stock Analysis
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