The Local Market: A New Concept
Though more than half of the rental business in the U.S. comes from the local market, it is still a small percentage in Mexico.
One reason is that insurance replacement rentals don’t exist in Mexico, as insurance companies don’t cover loaners while clients’ vehicles are being repaired. Even more prevalent is that people still don’t view car rental as a viable means to fulfill their transportation needs. That is changing, slowly, Behar says.
“For the longest time, it was very expensive to rent a car in Mexico,” Behar says. “Now it’s as competitive as the United States. It’s been very difficult, but little by little we’ve been changing that perception and showing the public that car rental is an option.”
Behar credits AVASA’s remarkable growth in five years to an aggressive marketing, advertising and sales effort in an industry that traditionally has done little promotion in Mexico.
AVASA’s sales team includes 70 sales executives, five regional sales managers and one director of sales. AVASA advertises heavily in the Yellow Pages, newspapers, in-flight magazines and in airports. The company has strong marketing partnerships with national airlines Aeromexico and Mexicana as well as with Visa, MasterCard and American Express.
Along with this sales effort, the company has been able to lower rates and offer more vehicle choices and volume. “We’re promoting products other rental car companies haven’t gotten into, such as luxury cars and the Fun Collection,” Behar says. “We’re also going to make a very big deal with Gold Key service.”
New Partnerships
The company’s boldest initiative is its recent partnership with Wal-Mart, the first of its kind in Mexico.
AVASA recently signed an exclusive deal to open operations at Wal-Mart’s chain of 268 superstores in Mexico. After five years of negotiations, AVASA won the right to advertise in-store—the only non-food, non–Wal-Mart product with that distinction—and the ability to accept the Wal-Mart credit card for payment. The rental facility is a high-class mobile unit stationed in the parking lot with space for seven vehicles, including truck rentals.
AVASA has opened operations at 10 Wal-Mart stores this year, with plans to open 10 more by the end of the year. “It’s a very big deal for us to go after the local market,” Behar says. “We believe it’s going to take us into a whole different direction here.”
AVASA also recently signed a deal to open locations inside bus terminals. This is another first in Mexico, a country with no train service but an extensive and established bus system.
The creative marketing efforts, partnerships and service innovations will continue, fueling further growth. “Every year we’ve done things that our competitors here don’t do,” Behar says. “We’ve had the pleasure of benefiting from that.”
Daryl Lubinsky is a contributing writer for Auto Rental News.
To subscribe to Auto Rental News magazine, click here.