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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I=4
Sixt CBO Vinzenz Pflanz said their focus is growth, especially in North America and Europe
“The first priority of business is to continue to grow. At the moment, that is not a standard priority in the market,” he said.
“We are growing in the U.S., and we are growing in the markets in Europe. The German market is still growing as well, even though growth has been very slow over the last periods of time,” he added.
"So, the setup of the product in the U.S. helps a lot to further growth. Nevertheless, we are ambitious about growth in Southern Europe as well. I’m also very sure that markets like Germany, where we do not have the growth rate that we’re used to, will stage a comeback and grow again. In all markets where we are active with a solution for B2B customers, I see a very good future.”
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I=6
CFO Franz Weinberger predicts inflationary tendencies in terms of price development in the USA
- In an interview with fvw|TravelTalk on August 14, Sixt CFO Franz Weinberger predicted “inflationary tendencies” in terms of price development in the USA due to Trump’s tariffs.
- He said the challenge in USA is that customers are booking at a very short notice, making planning very difficult.
- He said they expect to meet their guidance for 2025 (revenue: +5% to +10%) partly because July went well.
- He pointed out that they recently made heavy investment in Italy and southern France, as well as in Germany.