Yearly Archives: 2009

SAVRALA Manufacturer of the Year 2009 Awards

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Friday, 23rd October 2009, The Ballroom @ The Wanderer’s Club, Illovo

Manufacturer of the Year 2009
Hyundai South Africa


 Stanley Anderson, Hyundai marketing director (left) and his triumphant Team Hyundai blow their trumpet … or rather, Vuvuzela!  The Korean marque took home Gold in both the Overall and Rental Section award categories as well as Silver in the Leasing Section award category.

Hyundai: Patience rewarded

Hyundai is the 2009 SAVRALA Manufacturer of the Year and is the first importer to earn the prestigious accolade – achieved by a slender 0.2% over second placed Volkswagen and just 1.3% ahead of General Motors in third place. The Korean automaker also took pole position in the Rental Section awards.

Colin Windell, editor of FLEET, reports …

The result for Hyundai is a deserved one and comes after a patient climb through the ranks over the past four years – truly patience rewarded. Last year the company finished second overall and, perhaps, there was a sense of inevitability it would make that final step up the ladder this year. However, over the years manufacturers have found taking anything for granted can backfire quite heavily.

“It has been one of our business objectives to be the first Importer to win the SAVRALA award,” says Hyundai marketing director Stanley Anderson. “It took a lot of dedication from our staff and dealers to achieve this and all credit to them.

“There is no doubt that Hyundai has grown into a mainstream player in the automotive market, fleet as well as retail, thanks to product with leading designs, world class quality and backed by superior customer service.

“These awards are extremely important to Hyundai Automotive and our dealers. We study the results in detail every year and target the areas where we need to improve. The leasing and rental market is critical to the success of the brand and a priority for us to excel in.”

As usual, the competition was split into two parts – Rental and Leasing – with the combined result deciding the overall placing. Hyundai was first overall in the Rental section with a score of 60.8%, some 0.7% up on last year when they placed second. This year General Motors came in second with last year’s winners, Toyota, taking a 4.6% tumble to third place.

The most improved manufacturer in this category is Kia, which jumped from seventh last year to fourth, showing a 4.3% improvement. The biggest losers, however, were Honda – dropping from third place last year to 10th.

In the Leasing section, Volkswagen took the honours – a sterling effort coming from sixth place last year to top of the log, notching up a 4% improvement in the process. Although their score was down by 1.6%, Hyundai finished second in the category – up from fourth last year. Winners last year, Nissan dropped back to third place and 5% down on their score for last year.

Alfa Romeo put in a trot this year to be the most improved manufacturer in the category, gaining 9.4% over last year to move up from 22nd to 17th.

It has been a tough year for the motor industry and this showed in the final tally of scores where only Volkswagen in the top six improved on last year. All the others were marginally down.

With input obtained from a detailed survey of the members of SAVRALA, which is conducted twice during the course of the year, awards are bestowed upon those motor manufacturers who have provided the respective Rental and Leasing and Fleet Management companies with exemplary service in areas of communication, support and value.

According to Anthony Calcutt of KA Smart, which does the survey and analyses the results, within the Rental business, ‘Technical Training’ and ‘Regular Technical Representative Contact’ are major areas of concern receiving low scores.

“Timeous and Comprehensive Information on Models’ has become the question with the best scores,” he says.

“The Leasing and Fleet Management counterparts continue to rate ‘Dealer Delivery Quality’ highly and all three of the ‘Technical’ questions witnessed good improvements. The area of concern to them at the moment is around ‘Manufacturer Contact’.”
A new element introduced to the survey this year was the awarding of points against the B-BBEE level attained by each manufacturer.

“It is great to see a number of companies have embarked on this important process of true transformation and have taken the necessary steps in obtaining a verified scorecard,” says Calcutt. “We encourage all companies to continue in their efforts by improving on their scores going forward and embracing the essence of Broad-Based Black Economic Empowerment.

“Over the last four years the Overall Top 2 positions have been held by different manufacturers each year. These results are testament to the genuine competition that exists between each manufacturer in providing the best service possible to the South African Vehicle Rental and Leasing industry.”

“This is the second year running that we have won the Rental section, says Anderson. “We built on the success of last year and focused on the areas where we needed to improve. All credit has to go to my staff and dealers that made a valuable contribution to our rental business.”

“Our members see the vehicle manufacturers and importers as their prime partners and we appreciate their support, as much as they value our custom,” says SAVRALA president, Paul Pauwen. “Expressed in the percentage of the total volume sold to the market, our industry has purchased significantly more vehicles this year which goes to show why we are inter-dependant.

“The SAVRALA Manufacturer of the Year (MOTY) award is an attempt to reflect the strength of the relationship with the OEMs and how it is evolving rather than a purely volume based calculation. Several key factors are taken into account and they are surveyed comprehensively on two occasions during the year by both the rental and the leasing sections.

“The overall winner has been making good progress for several years, culminating with this year’s award. It is no real surprise as they have made a considerable investment in our industry and they are entitled to savour the moment.”
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1st Place Gold: Leasing
2nd Place Silver: Overall
Most Improved: Overall


Volkswagen of South Africa		 2nd Place Silver: Rental
3rd Place Bronze: Overall



General Motors South Africa

3rd Place Bronze: Leasing


 Nissan South Africa		 3rd Place Bronze: Rental


Toyota South Africa

The ‘Most Improved – Leasing’’ and & the ‘Most Improved – Rental’ Awards for 2009 went to Alfa Romeo South Africa and KIA Motors SA respectively. Congratulations!

Many thanks to all the motor manufacturers and importers for their generous support of the 2009 SAVRALA Manufacturer of the Year Awards

Penny wise can be pound foolish when it comes to car rental

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June 2009

In recent months, SAVRALA has experienced a sharp increase in the number of complaints from members of the public with regard to cost- and/or serviced-related complaints made against car rental companies that are not members of the association. In such instances, SAVRALA is largely unable to take any action to assist in resolving the dispute between the company and the customer.

As a result of these unfortunate incidents which tend to tar the entire car rental industry with the same brush, SAVRALA would reiterate the importance of dealing with a proven and reputable company when hiring a vehicle. Association membership is strictly defined and industry involvement does not constitute automatic qualification.

To maintain professional industry standards, compliance with SAVRALA’s Code of Conduct, Constitution and Charters is mandatory for any car rental company wishing to join the association. The Code and Charters establish standards of good practice for the passenger vehicle rental, leasing and fleet management industries and are intended to ensure that customers who obtain car rental or leasing facilities from association members receive the highest levels of service, honesty and integrity in all of their dealings.

There are a number of principles governing members one of which relates to complaints: “In the event of a customer complaint being received by a member, the association requires that the member follows a customer complaint procedure that ensures that the complaint is handled promptly and efficiently.”

In the event that a dispute cannot be resolved between the two parties to the satisfaction of both, it may be referred in writing to SAVRALA by the customer and/or the member company involved in the dispute. It will then be addressed by a three-person Conciliation Committee, a Committee whose members are appointed by the association’s National Executive and the outcome notified to both parties within a reasonable period of time.

Car rental companies belonging to SAVRALA are obliged to uphold the association’s Rental Charter which states:

As a SAVRALA member, we pledge to provide for our customers:

  • Complete details of pricing, ensuring you are aware of all charges before commitment to a rental contract

  • Vehicles that are serviced and inspected to the manufacturer’s operating specification as a minimum standard and complying with all statutory requirements

  • Vehicles that are fully valeted and inspected for safety and comfort before each rental – from a selection of low mileage, current model vehicles

  • An appropriate range of risk protection products and other services

  • Commitment to SAVRALA’s Code of Conduct

  • An effective complaints procedure with access to a conciliation service administered by SAVRALA

For those individuals or companies not familiar with the association and its activities, SAVRALA is a trade association representing close to 90% of South Africa’s combined vehicle rental, leasing and fleet management industries.

Since its inception in the early 1980s, SAVRALA has been active in steering industry standards, serving to raise the professional profile of these industry sectors and as its united and representative voice, striving to ensure and protect its members’ interests at the highest levels the government sector. Its members have acknowledged the benefits of interacting competitively but cohesively for the common good of the industry and a key SAVRALA objective remains the address of industry-generic issues to ensure the long-term sustainability of the industry as a whole.

Global distribution costs within the travel chain – including car rental

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May 2009

Global distribution costs (GDS) are the charges incurred by the travel management sector when utilising the services of Internet-based travel reservation engines such as Galileo, Worldspan and Amadeus and according to Val van den Bergh, general manager of SAVRALA’s car rental section, the corporate travel sector in particular, is feeling the impact of these costs.

“GDS costs have a significant impact on the distributions costs of the car rental industry – primarily in the corporate segment of our business where customers prefer to reserve their vehicles via a travel agent as their travel itinerary also includes flights and accommodation. This one-stop travel solution is important to corporate customers in terms of their travel policies and the subsequent integration of information into their financial systems and management reports.

She goes on to say that these costs are reservation-based and have no link to length of rental or type of vehicle reserved. “GDS costs to the car rental supplier are around R45 per reservation depending on the prevailing exchange rate. On a one-day rental for example, the GDS cost could be in the region of 20% of the rental value, clear indication that single-day rentals booked via GDS are not profitable for car-rental companies.

“In addition to this, with the Rand weakening from R7.50 to R10.00 to the US$ over the past six months, car rental companies have had to absorb a 25% increase in GDS costs.”

Van den Bergh says that generally speaking, corporate travellers tend to make numerous changes to their travel arrangements and this leads to cancellations and ‘no-show’ problems for car rental companies which in the main, do no levy charges back to the travellers. “Most car rental companies experience 5% – 10% customer ‘no-shows’. With some agents this figure is significantly higher which means that GDS fees are paid out for no revenue earned.”

In attempt to resolve the issue, she says that the car rental industry is engaging with the various GDS companies to seek recourse and refunds and is also consulting with ASATA and the travel industry at large to determine ways in which this problem can best be addressed.

“Most travel agents have not been motivated to move away from the GDS systems as they provide operating efficiencies, management information and real-time access to multiple products and suppliers within a single, one-stop system,” she explains. “In addition to this, they are incentivized by the GDS companies on sector or reservation targets across all products.”

One solution that has been mooted by certain suppliers within the travel industry is that customers are offered two pricing options: one via the GDS channel and the other not.

“While most of SAVRALA’s members remain committed to partnering with travel management companies, the fact is that most travel-related businesses – car rental companies included – will for the foreseeable future, continue to experience diminished margins and consequently, they will need to reduce costs,” concluded Van den Bergh.

“Going forward, a win-win solution between the suppliers, GDS companies, travel agencies and the traveller is going to have to be found in order to ensure that the traveller receives the lowest cost option available while at the same time ensuring that each link in the travel chain is remunerated in line with the value they have added.”

Golf Day nets R50 000 for Marang House

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Based in Northcliff, Gauteng, Marang House provides professional medical care in a non-institutional, home-like environment to seriously ill children. Receiving the cheque from SAVRALA president Paul Pauwen is Marang’s Pieter Ernst.

SAVRALA’s 2009 Community Outreach Golf Challenge was held at the Ebotse Golf and Country Estate on Wednesday 25 February. As always, our members put their full weight behind the charity event with 120 players turning out on the day and 10 member companies sponsoring holes. Thanks to all SAVRALA members for their fantastic support of the day.

Our next golfing fundraiser takes place in February 2010.

Car rental industry readies itself for 2010 Fifa World Cup

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April 2009

“Whilst we do expect positive opportunities for our rental members in 2010, we anticipate growth in demand for people carrier vehicles (micro buses) in particular. As most of our members usually run at maximum utilization of this category of vehicle, this is likely to present a challenge,” says Val van Bergh, general manager of the Southern African Vehicle Rental and Leasing Association’s (SAVRALA).

“The World Cup event will, however, be taking place in the down-season in terms of car rental volumes and utilization,” she adds. “While fleets would normally be trimmed during this period by between 25% and 35%, this is not likely to be the case in 2010.”

Van den Bergh goes on to say that by default, South Africa’s car rental fleet will actually be up over 2009 “which will allow us to cater for increased demand.

“Yield management and the risk in swelling the fleets will be critical during this time and we do not envisage members discounting rates. Travel partners have already been informed that traditional corporate reservations need to be booked well in advance to enable members to plan and so ensure that business travelers are served as usual.

She is of the opinion that the corporate car rental segment may experience fewer rental days as a result of limited accommodation which may result in corporate travelers flying in and out on the same day.

“Shorter rentals place huge pressure on vehicle turnarounds and also increases costs,” adds Van den Bergh.

“The industry is also focusing on all areas of risk management during this period and ‘rental criteria’ is likely to become stricter with better checks and balances and a way of verifying customer information in place at the time of rental.

“Car rental companies have been hard hit during the last few months as a result of credit card fraud and card skimming and we are doing everything within our power to ensure that client information is handled with the strictest care to minimize risk.”

SAVRALA is also looking at the post-event legacy that South Africa’s car rental industry will leave behind and according to Van den Bergh the SAVRALA Mobility Project – which has been developed in conjunction with Theta in preparation for 2010 – will be training over 700 chauffeur-drive drivers. Of these, 30% will comprise currently employed drivers with the balance targeted at unemployed graduates.

Touching down on African soil for the first time, the 2009 FIFA Confederations Cup will test South Africa’s state of readiness for the 2010 World Cup and be played in five cities – Johannesburg, Rustenburg, Tshwane/Pretoria, Mangaung/Bloemfontein and Nelson Mandela Bay/Port Elizabeth – between 14 and 28 June 2009.

“As far as the Confederations Cup goes, we are monitoring developments and reservations closely but see no significant increase in reservations over this period as yet,” says Van den Bergh. “Initial indications are that bookings will be no greater than those experienced with previous international rugby or cricket test match events.

“While our car rental industry is known for delivering world class customer service, it is important that we have properly trained and enthusiastic staff to welcome visitors to these events and ensure that we play our part in making their South African experience a memorable one.

“There is always the danger that opportunistic fly-by-night operators will rear their heads and fail to deliver the standard of service that car rental customers would expect,” she warns. “It is therefore essential that we work as closely as possible with our travel partners and the media to ensure that SAVRALA’s rental members are made known to the public and that when they utilize the services of these companies, they have the comfort that the standard of service and the product delivered will be in accordance with the Association’s charter and code of conduct.”

Traffic fines and traffic offences will certainly increase during these times and it will be critical to capture accurate driver information. “We are hoping that our interactive platform with eNaTIS to verify customer information will be operational, also that the authorities will have a system in place to deal with traffic fines incurred by non residents.

“South Africa is capable of delivering a world class event if the transport system is able to back it up.”