Easycar Case Analysis

Background

A. The Environment

Economical Environment:

The economical environment is Western Europe’s economy which is considered one of the healthiest economies, since the individual’s GDP in these countries is one of the highest worldwide.

Many factors qualify this environment to be a suitable place for rental car business; since Europe is one of the most strategic hotspots in the business world nevertheless it’s an attraction to many tourists.

The recession period in tourism in general, and rental car industry due to the 9/11 attacks.

Political- Legal:

The 7 days return policy, ruled by the Office of Fair Trading (OFT) which stated that easyCar must grant consumers 7-day cooling-off period from the time of reservation in order to cancel their reservation and receive a full refund.

EasyCar’s policy of posting pictures of consumers whose cars were 15 days or more overdue which led to legal concerns, especially if easyCar posted a wrong picture.

Other:

Technological factor. The advancement in communication methods such as the Internet and automated phone service which eased the car rental procedures.

B. The Industry

EasyCar is operating in a rental car industry

The Competitive situation: As for the rental car industry, there is a strong competition in Western Europe, since the industry consisted of several international and national companies which basically were dominating more than half of the market. Examples of strong positioned international companies include Avis, Hertz, Europcar,..etc example of regional market such as Sixt in Germany. In addition, there are also smaller rental companies as well as brokers operating in each market. Also, according to Stelios easyCar could be a serious competitor to public transportation means such as local taxis, buses, and trains, and that’s after changing easyCar’s policies for 2003 to allow rentals for as little as one hour.

Competitor’s strengths:

The usage of intermediaries and brokers which manage the excess of the competitor’s inventory beside the usage of their own outlets and websites.

Large number of fleet size and rental outlets.