Avis Budget Group reported record net income of $674 million and adjusted EBITDA of $1.06 billion, the highest quarterly EBITDA in the company's 75-year history.
Revenue for the third quarter reached $3 billion, nearly double the figure for 2020 and 9% above 2019.
Ferraro said, "We are seeing the benefits of initiatives we began during the early days of the pandemic and look to build on this positive momentum as the travel environment continues to normalize."
In the third quarter, the Americas accounted for earnings of $952 million, and international markets earnings of $128 million. The figures were bolstered by strong pricing, with average revenue per day up by 44% in the U.S. and 25% internationally, excluding exchange rate differences. The rise in rates has been driven in part by the shortage of semiconductors for new vehicles.
In the group's Q3 earnings call, Ferraro said that the expansion of contactless rentals, particularly end-to-end bookings with Avis QuickPass, had been welcomed by customers during the pandemic.
He said there had been "sequential growth coming back" in the corporate sector but it was "not back to 2019 levels." The group makes 40% of its revenues from commercial rentals.
He said, "Some of the growth has been in the small and midmarket. They have come out a bit quicker [than larger companies] and those have come at an enhanced rate."
Ferraro added, "[Corporates] are keeping cars longer which is helping the utilization curve. On average, the commercial customer is keeping a car 30% longer than in 2019.
"I fully expect commercial business to start coming back as people go back to their offices and people start accepting them into their locations."
Ferraro said the company was "particularly encouraged by news that European vaccinated travelers will be allowed entry to the U.S."
"Since the announcement, we have definitely seen an increase in our business patterns of people coming to do business here in the U.S. Booking patterns are above 2019 levels and we see the same thing the airlines reported a week or so ago," he said.
The future is electric
Ferraro added fuel to the dialogue around electric vehicle production and the role of car rental companies in advancing toward that future.
"You'll see us going forward be much more active in electric scenarios as the situation develops over time," he said, adding that Avis wants to see more electric models available in the market to guard against parts shortages or potential recalls.
While the CEO was bullish on Avis Budget Group's involvement in the future, he didn't discuss any current or future commitments in the space.
Last week, rival Hertz announced its commitment to purchase 100,000 Model 3 Teslas and an expanded partnership with Uber that would make 50,000 of those available to top-rated drivers.
Source: Business Travel News