Doing just traditional car rental isn't going to cut it anymore, and Avis is rapidly expanding its alternative services.
Travel's most forward-thinking insiders will gather September 18–19 for our annual Skift Global Forum in New York. In just a few years, Skift's Forums — the largest creative business gatherings in the global travel industry — have become what media, speakers, and attendees have called the “TED Talks of travel.”
Skift Global Forum 2019 will take place at Jazz at Lincoln Center’s Frederick P. Rose Hall in New York. This year's Forum speakers include CEOs and top executives from Booking Holdings, Delta Air Lines, Expedia, Air France-KLM, Marriott International, Amtrak, and many more.
One of the biggest challenges for car rental companies in the age of the smartphone is the expansion of ridesharing companies like Uber and Lyft. Both business and leisure travelers are increasingly opting to use the apps to get around, instead of the traditional method of renting a car.
As one of the largest car rental companies in the U.S. by market share, Avis has often struggled to react to this constantly changing mobility landscape. In recent years, the car group has focused on strategic partnerships: In August of last year, it announced a partnership with Lyft, and just this week, it revealed it had partnered with Uber. These business decisions give the company a way to leverage its huge number of vehicles, renting them out to rideshare companies when they no longer meet the higher standards of its core fleet.
But this is only part of the work. The car rental company is also investing heavily in technology, introducing connected fleets, and improving its web and mobile presence, according to Arthur Orduña, chief innovation officer at Avis Budget Group. He believes that leveraging data, as well as investing in and partnering with smaller startups, is a way the company can grow its central business while also expanding into new areas of the market.
Orduna will speak at Skift Global Forum on September 18–19 in New York.
Skift Editor’s Note: This interview has been edited for clarity and length.
Skift: Ridesharing is becoming more popular among business travelers. How does Avis see its role in an increasingly competitive market?
Arthur Orduña: We see ourselves as a mobility provider. Across our multiple brands, consumers can already drive a car by the minute, hour, day, week, or longer. We expect to continue to evolve these offerings to meet the evolving needs of our customers.
We also are partnering with many of today’s new mobility providers, offering them our expertise, human power, and access to our physical fleet, as well as data analytics. We’ve partnered with Waymo, which leverages our brick-and-mortar locations and our professional staff to keep their vehicles clean and serviced. We have also partnered with Lyft and Via, renting our vehicles to their drivers to help them meet demand.
Lastly, we have partnerships with Brightline in Florida and NextBike in Germany to offer customers multimodal transportation options. We see our approach as both direct provider of mobility services, as well as partner and enabler of them.
Skift: Consumers are often looking for on-demand service, as well as flexible and personalized experiences. How is Avis innovating to meet the demands of the modern business traveler?
Orduña: We’ve developed our own mobile app, which gives customers much greater visibility, control, and customization of their rental experience. We’re also in the midst of connecting our entire fleet of 600,000 vehicles to our cloud-based platform, providing even more personalization and flexibility.
We’ve also launched a developer program that will make it seamless to introduce new features and services into the app. One example of this is our partnership with Arrive. We’ve bundled their parking app into the Avis app, so now finding, reserving, and pre-paying for parking is a snap for customers. We expect to bundle in many more new features and apps from partners via this program.
Also, back in June, we were the first rental car company to launch a new feature within our mobile app called Split My Bill. The new feature within the Avis mobile app provides travelers with the ability to split car rental payments, including the total bill amount, rental days, or additions like Sirius XM Radio and upgrade costs, between two different credit cards or forms of payment during the rental period. It allows travelers to divide rental costs between their corporate and personal credit cards for greater convenience on the road.
Skift: In late 2017 Avis opened a lab to test its connected fleet in Kansas City. Is the company looking to do more partnerships with cities?
Orduña: We’ve been very pleased with our experience working with Kansas City. It was a significant undertaking for our company, and we’ve learned a lot. I think one of the key things we learned from that is the importance to cities of the data that our vehicles generate.
Toward that end, we’re now working with Otonomo, a company that specializes in driving insights from data, on how to work with cities, universities, and other communities on how best to put the data and insights to best use. So, we’re still very interested in working with cities, and we believe the best route will be through data.
Skift: How does Avis see the future of smart city technology?
Orduña: The shortest answer is that the “whole is greater than the sum of its parts.” By that I mean you really need to have as much of the city connected as possible in order to generate the benefits we all want. It does no good to have traffic lights connected but not highway on-ramp meter lights. Or Ubers and Lyfts connected to a traffic network, but not taxis. That’s why we need all players in the ecosystem, as well as municipalities, working together to ensure we have technology and policy aligned for maximum benefit. Done right, we could see big benefits for cities and citizens in terms of efficiency, safety, and convenience.
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Photo credit: An Avis customer uses the Avis app. The company has been investing heavily in digital technology. Avis Budget Group