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31	31	Competition among vehicle rental industry participants is intense and is primarily based on price, vehicle availability and quality, service, reliability, rental locations, product innovation, competition from online travel agents and vehicle rental brokers. The company believe that the prominence and service reputation of the Hertz, Dollar and Thrifty brands, its extensive worldwide ownership of vehicle rental operations and its commitment to innovation and service provide it with a strong competitive foundation.
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33		-**U.S.**
	33	+== U.S. ==
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35	35	The U.S. represents approximately $29 billion in estimated annual industry revenues for 2017. The average number of vehicles in the U.S. vehicle rental industry decreased 5% in 2017 to about 2.2 million vehicles. U.S. industry revenue per unit per month was approximately $1,091 which was an improvement of 6.5% over 2016. Rentals by airline travelers at or near airports (‘‘airport rentals’’) are influenced by developments in the travel industry and particularly in airline passenger traffic (‘‘enplanements’’) as well as the Gross Domestic Product (‘‘GDP’’). Off airport rental volume is primarily driven by local business use, such as vehicle repair shops, leisure travel and insurance replacements.
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37	37	The company's principal vehicle rental industry competitors in the U.S. are Avis Budget Group, Inc. (“ABG”) which currently operates the Avis, Budget, ZipCar and Payless brands and Enterprise Holdings, which operates the Enterprise Rent-A-Car Company ("Enterprise"), National Car Rental and Alamo Rent A Car brands. There are also local and regional vehicle rental companies, and transportation network companies which provide ride-hailing services that have some overlap in customer use cases, which are largely used for short length trips in urban areas.
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39		-**Europe**
	39	+== Europe ==
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41	41	Europe represents approximately $16 billion in annual industry revenues. Europe has generally demonstrated a lower historical reliance on air travel. The European off airport vehicle rental market has been significantly more developed than it is in the U.S. Within Europe, the largest markets in which the company do business are France, Germany, Italy, Spain, and the United Kingdom. Throughout Europe, the company do business through company-operated rental locations as well as through its partners or franchisees to whom Hertz Global Holdings has licensed use of its brands.
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43	43	The company's principal pan-European competitors in the vehicle rental industry are Europcar, Enterprise Holdings, operating the Enterprise, National, Alamo brands and the Dooley, Citer and Atesa brands in Ireland, France and Spain, respectively, ABG operating the Avis, Budget, Payless and Zipcar brands and the Maggiore brand in Italy. In certain European countries, there are also other companies, and brands with substantial market shares, including Sixt SE, operating the Sixt brand in Austria, Belgium, France, Germany, Italy, Luxembourg, the Netherlands, Spain, Switzerland and the United Kingdom.
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45		-**Asia Pacific**
	45	+== Asia Pacific ==
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47	47	Asia Pacific, including Australia and New Zealand, represents approximately $13 billion in annual industry revenues. Within this region, the largest markets in which the company do business are Australia, China, Japan and South Korea. In each of these markets Hertz Global Holdings has company-operated rental locations or do business through its partners or franchisees to whom Hertz Global Holdings has licensed use of its brands.
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49	49	The company's principal vehicle rental industry competitors in the Asia Pacific market place are ABG, operating the Avis, Budget, Apex and Zipcar brands, Europcar, and Enterprise Holdings, operating the Enterprise, National and Alamo brands and the Redspot brand in Australia and New Zealand.
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51		-**Middle East and Africa**
	51	+== Middle East and Africa ==
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53	53	The Middle East and Africa represent approximately $3 billion in annual industry revenues. Within these regions, the largest markets in which the company do business are Saudi Arabia, South Africa and the United Arab Emirates. In each of these markets the company do business through its franchisees to whom Hertz Global Holdings has licensed use of its brands.
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55	55	The company's principal vehicle rental industry competitors in the Middle East market are ABG, operating the Avis, Budget, Payless and Zipcar brands, Europcar, Enterprise Holdings, operating the Enterprise, National and Alamo brands, and Sixt SE, operating the Sixt brand.
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57		-**Latin America**
	57	+== Latin America ==
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59	59	The Latin America markets represent approximately $3 billion in annual industry revenues. Within Latin America the largest markets in which the company do business are Argentina, Brazil, Chile and Mexico. In each of these markets its Hertz, Dollar and Thrifty brands are present through its partners or franchisees to whom Hertz Global Holdings has licensed use of the respective brand.
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63	63	In 2017, the company completed the sale of its Brazil Operations to Localiza. As part of the sale, both companies entered into referral and brand cooperation agreements to govern their ongoing relationship which have an initial term of twenty years with an option to extend for another twenty years. The alliance also involves the exchange of knowledge in areas of technology, customer service and operational excellence.
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65		-==== Brands ====
	65	+= Brands =
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67	67	The company's U.S. and International vehicle rental businesses are primarily operated through three brands - Hertz, Dollar, and Thrifty. The company offer multiple brands in order to provide customers a full range of rental services at different price points, levels of service, offerings and products. Each of its brands generally maintains separate airport counters, reservations, marketing and other customer contact activities. The company achieve synergies across its brands by utilizing a single fleet and fleet management team and combined maintenance, cleaning and back office functions, where applicable.
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77	77	Internationally, the company also offer its Firefly brand which is a deep value brand for price conscious leisure travelers. Hertz Global Holdings has Firefly locations servicing local area airports in select international leisure markets where other deep value brands have a significant presence.
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79		-==== Operations ====
	79	+= Operations =
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81		-**Locations**
	81	+== Locations ==
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83	83	The company operate both airport and off airport locations which utilize common vehicle fleets, are supervised by common country, regional and local area management, use many common systems and rely on common maintenance and administrative centers. Additionally, its airport and off airport locations utilize common marketing activities and have many of the same customers. The company regard both types of locations as aspects of a single, unitary, vehicle rental business. Off airport revenues comprised approximately 33% of its worldwide rental vehicle revenues in 2017 and approximately 32% in 2016.
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85		-**Airport**
	85	+== Airport ==
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87	87	Hertz Global Holdings has approximately 1,600 airport rental locations in the U.S. and approximately 1,500 airport rental locations internationally. The company's international vehicle rental operations have company-operated locations in Australia, Belgium, Canada, the Czech Republic, France, Germany, Italy, Luxembourg, the Netherlands, New Zealand, Puerto Rico, Slovakia, Spain, the United Kingdom and the U.S. Virgin Islands. The company believe that its extensive U.S. and international network of company-operated locations contributes to the consistency of its service, cost control, vehicle utilization, yield management, competitive pricing and its ability to offer one-way rentals.
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91	91	The terms of its concessions typically do not forbid it from seeking, and in a few instances actually require it to seek, reimbursement from customers for concession fees the company pay; however, in certain jurisdictions the law limits or forbids its doing so. Where Hertz Global Holdings is required or permitted to seek such reimbursement, it is its general practice to do so. Certain of its concession agreements may require the consent of the airport's operator in connection with material changes in its ownership. A growing number of larger airports are building consolidated airport vehicle rental facilities to alleviate congestion at the airport. These consolidated rental facilities provide a more common customer experience and may eliminate certain competitive advantages among the brands as competitors operate out of one centralized facility for both customer rental and return operations, share consolidated busing operations and maintain image standards mandated by the airports. See Item 1A, "Risk Factors” in this 2017 Annual Report.
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93		-**Off Airport**
	93	+== Off Airport ==
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95	95	Hertz Global Holdings has approximately 2,600 off airport locations in the U.S. and approximately 4,500 off airport rental locations internationally. The company's off airport rental customers include people who prefer to rent vehicles closer to their home or place of work for business or leisure purposes, as well as those needing to travel to or from airports. The company's off airport customers also include people who have been referred by, or whose rental costs are being wholly or partially reimbursed by, insurance companies following accidents in which their vehicles were damaged, those expecting to lease vehicles that are not yet available from their leasing companies and replacement renters. In addition, its off airport customers
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161	161	(Airport/Off airport)
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163		-==== Fleet ====
	163	+= Fleet =
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165	165	The company believe Hertz Global Holdings is one of the largest private sector purchasers of new vehicles in the world. During the year ended December 31, 2017, the company operated a peak rental fleet in the U.S. of approximately 504,300 vehicles and a peak rental fleet in its international operations of approximately 201,500 vehicles, and in each case exclusive of its franchisees' fleet and Donlen's leasing fleet. During the year ended December 31, 2017, its approximate average holding period for a rental vehicle was 17 months in the U.S. and 14 months in its international operations.
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191	191	The company maintain automobile maintenance centers at or near certain airports and in certain urban and off airport areas, which provide maintenance for its vehicles. Many of these facilities include sophisticated vehicle diagnostic and repair equipment and are accepted by automobile manufacturers as eligible to perform and receive reimbursement for warranty work. Collision damage and major repairs are generally performed by independent contractors.
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193		-==== Franchisees ====
	193	+= Franchisees =
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195	195	In certain U.S. and international markets, Hertz Global Holdings has found it efficient to utilize independent franchisees, which rent vehicles that they own, primarily under its Hertz, Dollar, or Thrifty brands. In certain markets and under certain circumstances, franchisees are given the opportunity to acquire franchises for multiple brands.
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