CAR RENTALS Invading the turfs of rivals

They're setting up neighborhood stores as air travel wanes.
ST. LOUIS (AP) -- It's part of an intensifying car rental rumble: As Enterprise Rent-A-Car increases its visibility at airports, longtime airport leader Hertz is muscling into America's neighborhoods, Enterprise's closely guarded turf.
Over the past three years, Hertz has christened more than 800 away-from-airport sites to push its total to 1,100, with hopes of adding another 200 before the end of this year.
New car rental sites are sprouting as Hertz and other Enterprise rivals eye off-airport sites, hoping to reduce their dependence on an air travel industry that has struggled since the September 2001 terrorist attacks. Such woes contributed to the bankruptcies of Alamo, National and Budget, car rental companies that since have regained their footing.
Enterprise, the nation's largest rental car company, is responding in kind, seeking more counter space at the airports. It has opened 27 airport outlets in the latest fiscal year, bringing its total in recent years to 170, including operations at every major U.S. airport.
"It's open season. It's capitalism. There's plenty of business out there," said Neil Abrams, whose New York-based consulting group has a market research unit that monitors businesses including the rental car industry.
New focus
According to Abrams Travel Data Services, car rental companies will generate $18 billion in revenue nationwide this year. About 40 percent of that business will be away from airports, explaining the new focus on car rentals in neighborhoods and suburbs.
Enterprise has more than 6,000 locations worldwide -- 5,400 of them in the United States -- and on average has been opening a new branch every business day. Its response to the mounting challenge: Bring it on.
"Why is everyone running to the non-airport market that we cultivated? What other choice do they have?" said Christy Conrad, spokeswoman for St. Louis-based Enterprise, which became the nation's biggest rental car company mostly on the strength of its neighborhood rental shops that often provide temporary replacements while cars are being repaired.
"This isn't the first time we've seen the competition in our market. It happens in cycles; competition comes and goes," she said. "We really do a better job when the competition is there. It keeps us on our toes."
Enterprise's dominance
The privately-owned Enterprise, which boasts it has sites within 15 miles of 90 percent of the U.S. population, has been the 800-pound gorilla in the local and replacement market, thanks to its deals with major insurers, large auto dealers and automotive service companies.
Such neighborhood dominance, observers say, has given Enterprise relative stability and made it more recession-proof than other rental companies more reliant on air travelers. In good times and bad, car wrecks happen, and folks need rentals to get them by.
"There aren't too many industries you can think about where there's such a major domination in one marketplace," Abrams said of Enterprise.
Hertz hopes to chip away at that, seeking growth beyond its comfort zone of airports, where it enjoys a 30 percent market share. By stepping into suburbia, Hertz, owned by Ford Motor Co., sees the lucrative insurance-replacement market as a "very promising niche," spokeswoman Paula Stifter said.