Europcar Group has announced the reorganisation of its low-cost business unit to fully benefit from the recent Goldcar acquisition.
The low-cost car rental segment is one of the most dynamic in Europe, representing approximately €1.5 billion, enjoying a historical 12 per cent annual growth rate and expected to continue to grow at a similar pace, especially in leisure destinations like France, Spain, Italy, UK, Portugal, Greece and Turkey.
The low-cost business unit will be managed by Juan-Carlos Azcona, Goldcar’s former chief executive, and will include the InterRent and Goldcar brands.
The combination of these two major players allows the group to build a large platform and to benefit from a significant scale within the segment.
This business unit is expected to generate a major portion – at least 15 per cent - of group revenues in the near future.
In order to fully benefit from the agility of Goldcar’s organisational structure, their lean processes and a solid, flexible and scalable IT system, the InterRent brand will be operated by Goldcar in Portugal, Spain, France, Italy and the UK.
In conjunction with the reorganisation of the low-cost unit, the group is currently adapting its brand platform in order to seize the opportunities of the growing leisure market, offering its customers tailor-made mobility solutions that meet their expectations in terms of service, support and price.
As a result, InterRent will progressively be repositioned as the mid-tier brand of the group and will target leisure customers who want to find the right balance between a fair price and a smooth and simple customer experience.
Positioning InterRent in the mid-tier market is a strategic move to address a segment which is estimated to represent around 20 per cent of the overall market with significant upside coming from the market trend dynamics.
Fabrizio Ruggiero, deputy chief executive, sales, marketing, customers and low-cost, explained: “After only three months since completing the Goldcar acquisition, we have been able to establish our strategic positioning in the low-cost market.
“We have started to execute on our plan for our low-cost business unit in order to deliver the full extent of the value creation that we were foreseeing and presented at the time of the acquisition.
“Hence, we wish to reiterate our confidence with regards to delivering at least € 30 million of cost synergies by the end of 2020.
“Furthermore, the definition of our new brand architecture gives us a great opportunity to fully address and develop our leadership on the three layers of the market we operate in, namely upscale/premium with Europcar, mid-tier with InterRent and low-cost with Goldcar.
“We do believe this new brand platform will allow us to expand our customer reach through stronger brand preference and strengthen our undisputed leadership.”