AVIS Southern Africa's acquisition of Avis licensees in Norway and Sweden - purchased for R300m from Scandinavia's Schoyen transport group - will result in a positive spin-off for inbound tourism to Southern Africa and will provide the company with a "firm foothold" for further international expansion.
This was predicted by Avis' marketing manager, Lance Smith, shortly after ceo, Grenville Wilson, made the announcement in Cape Town last week, at a ceremony held to formally announce Avis' annual year-end results. The news ended widespread industry speculation following the issue of two cautionary notices on March, 6 and April 25.
"Norway and Sweden appealed to us because they fall in the same time zone as South Africa, have stable currencies and strong economies with a projected GDP growth of some 4,5%," said Wilson.
"We will be controlling the sales team and the three countries will be working closely together, requiring a large number of staff to spend from 20 to 26 weeks a year in SA, thus stimulating interest in the various tourism facilities and attractions," explains Smith.
According to him, the international corporate industry would be considerably boosted as well.
During the announcement in Cape Town last week, Wilson indicated that given Avis' leadership position in the Southern African market - currently holding 41% of the car rental market - the group had to look further afield for expansion, hence the Norwegian and Swedish deal.
Avis Rent-A-Car's growth over the past year topped the R2,1m mark.
Smith further indicated that despite the fact that Avis' Oryx destination management service in Namibia had not achieved its target due to the unstable situation in the far-north Caprivi region, the Rent-A-Car service performed "exceptionally well".
However, two factors contributed to a significant drop in the Zimbabwean licensee operation - the fuel crisis and the farm unrest preceding the upcoming elections.
"Our US offices have reported en masse cancellations to Zimbabwe and if the Internet notices stating that the country is a 'no-go' zone are not removed, the situation is not going to improve."
(Adele Mackenzie)
