Discussion about Sixt in its car rental market environment.
@Magaly Do you have a take how used car prices globally should develop? (U.S, Europe, Germany)
In the back of my mind I have the information that price declines should ease and the market should stabilize but you are more deeply into the topic.
Additionally, insights into the demand and supply situation in the car rental industry are interesting.
I believe that we have both factors currently not incorporated in our Sixt valuation model
@Aron?
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I only considered that the decline in used car prices will probably ease, especially next year and that demand should continue at the same rate. I think Sixt should be able to control supply in-line with demand?
But more insights on both will be helpful.
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Yes, I still expect used car prices to stabilize over the next two years, likely to be between within a -2% to +2% Y/Y range, particularly for younger vehicles.
We’ve already seen greater stability in Q3, both in the U.S. and Europe.
I made a post here to explain why I still expect used car prices to start stabilizing going forward.
It seems companies like Hertz and AVIS also expect to get more normal depreciation trends in 2025 and 2026, especially after they finish the current fleet rotation.
I will eventually work on a model to have more specifics.
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Cool thank you, this was helpful and eases one of the worries.
Do you have any current insights into the tourism industry in q3 and its outlook in the next years?
I am debating whether I should reduce the Sixt investment given that there are cultural and management concerns
Any good industry insights that could give us clues into Sixt performance would be helpful to make the decision.
(Note: Insights don’t necessarily need to come from the tourism industry but could also come from specific reporting about Sixt or the car rental industry, competitors etc etc)
The problem with the car rental industry that I have found is that is very difficult to get industry research of any kind. I don’t know if it is because there are very few public companies in the industry that makes it not worth it to produce free research or resources
But I will see what I can found and create a post in the correct channel and link it here!
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