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Advantage Rent Car - The History of Advantage Rent a Car

company rental bankruptcy chapter

Advantage Rent a Car is one of the largest car rental services in the United States and the world abroad. At the company’s peak of operation, there were over 150 car rental agencies in the United States with the Advantage Rent a Car brand and over 130 Advantage Rent a Car agencies in 33 other countries.

Advantage Rent a Car actually began its existence in 1963 under the moniker of Three Ninety-Nine Rentals. It first existed as a very specialized car rental agency that mainly catered to the population military personnel stationed in San Antonio, Texas.

However, soon the agency expanded beyond just serving the government. Over a space of twenty years, the company expanded greatly into the leisure and feeder markets. The company especially developed a strong presence in local retail markets and in hundreds of busy airports across the United States. Although the company did have many operations in the Eastern United States, it was and still is even more prevalent in the West. In 1985, the company was consolidated and given the name that most people are now familiar with, Advantage Rent a Car.

During the 90’s, this expansion of Advantage Rent a Car’s operations continued at a rather brisk pace. The company continued to expand into more and more airports with a focus aimed towards tourist destinations. This continued expansion was most strong in states in the South and Southwest such as Florida, California, Texas, New Mexico, etc.

At this point in Advantage Rent a Car’s history, it also launched a plan to expand globally as well. It accomplished this goal by forging numerous affiliate partnerships in many different international markets. This plan was rather successful, and it allowed Advantage to accrue locations in over 33 different countries that all existed together under the same car rental agency network.

However, as with many other companies, Advantage Rent a Car was faced with hard times during the recession that hit its peak during 2008. It was during December of that year that the company was forced to declare bankruptcy.

Thankfully, the company declared Chapter 11 bankruptcy. This form of bankruptcy is available to businesses and allows those businesses to reorganize while simultaneously attempting to pay back creditors. It is not a straight liquidation as is the case with Chapter 7 bankruptcy.

The company had been hit especially hard in the tourism based markets where it used to do a very high volume of business with tourists traveling to and from airports. At this time, many citizens were saving money instead of spending it on expensive vacations due to the recession. This cut deep into Advantage Rent a Car’s income. Other problems that lead to Advantage’s bankruptcy included a freeze on lending by different financial institutions that had done business with the company in the past and a sudden spike in the cost of doing business by its different rental car agencies.

Due to these financial troubles, the company was forced to lay off 440 workers, which was nearly fifty percent of its workforce. As part of the Chapter 11 reorganization, the company also shut down 40 percent of its physical locations that had been performing very poorly for the company in recent history.

A huge event then occurred in Advantage Rent a Car’s history. It changed ownership. When the company went into Chapter 11 bankruptcy, it was owned by Denny Hecker, a very wealthy businessman who also owned many car dealerships in Minnesota. As is the case with many Chapter 11 organizations, the company was put up for sale. A number of different companies put up bids to acquire the assets of Advantage Rent a Car. Many of these were other car rental agency giants such as Enterprise Rent-a-Car.

However, it was Hertz, the largest car rental company in the world, who made the successful bid and purchased the company for a total of 33 million dollars. Hertz then decided to use the Advantage logo and website as a means to rebrand its “Simply Wheelz” line of car rentals. Simply Wheelz was a brand under Hertz that existed as a more economic alternative to the more expensive Hertz brand. With its acquisition of Advantage Rent a Car, Hertz also wished to expand greatly into the airport tourism market with the goal of offering more economic price points to target traveling families on a budget. It has done just that.

Although it has changed ownership, it is certain that the Advantage Rent a Car brand of car rental agencies will remain a force in the market for years to come.

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