The history of Car Rental in Brazil is quite recent. It started in the 1950s, a romantic time when car models such as the Beetle (Fusca), Dauphine, DKW, Aero Willis, Simca and Karman Guia, etc., circulated along Brazilian streets, avenues and highways. By that time, the automobile industry had been successfully stimulated by President Juscelino Kubitschek’s Targets Plan.
The first car rental businesses appeared in downtown Sâo Paulo, where some used car dealers started to rent cars as a complementary activity. One of these businessmen, Mr. Adalberto Camargo, envisioned car renting as a promising business. The moment was favorable; economic activities were growing and the country needed new means of transportation.
In 1956, Mr. Camargo joined together with entrepreneurs of other economic sectors so as to raise capital in order to finance his new company: Auto Drive S.A. Indústria e Comércio, the first company founded with the exclusive purpose of renting cars. The first cars rented out by the company were Volkswagen Beetles. These were rented to Brazilian customers who had traveled abroad and taken notice of how convenient it was to rent cars.
After this pioneering enterprise opened, other car rental businesses were created, although in the beginning this activity had to surmount great difficulties, such as cut-throat competition and the excessive wear-and-tear of cars due to the very poor conditions of roads at that time.
Expansion of the Business
In the mid-60s, the activity had a great boost when it was inspired by the North American car rental business. That influence was necessary at the time, and the business began to professionalize quickly in Brazil. Then, car rentals started to include contracts signed with companies that used fleets. Thus, the long-term rental emerged.
In the 70s, the first leasing companies appeared, through which it was possible to leverage the development of Car Rental companies, as long-term financial operations became available.
By the end of this decade the first alcohol fueled cars were made, a true corner-stone of Brazilian industry, as the country adjusted to the world-wide oil crisis. Car rentals started to use alcohol driven cars in great number, thus helping to popularize this type of vehicle throughout Brazil.
By then, car rental was a consolidated activity in Brazil, and as abroad, international car rental chains started to operate in Brazil.
Similarly, Brazilian car rental companies started to form chains using the franchising system. The rental of vehicles expanded considerably
Car rental know-how spread around the country and small regional companies were then founded. Such expansion caused the need to create an Association that would gather the pioneers of this new business around common objectives, such as: defending the interests of companies in the Sector, professionalizing the activity, advertising it and fighting cut-throat competition.
Sooner than expected, the rather chaotic economic environment of the 80s proved how relevant the organization of ABLA had been.
The unreliable economic environment in the 80s caused the economy to stagnate thus preventing economic growth, leading to the so called "lost decade". Despite the fact, supported by ABLA, which was founded on the 30th of March, 1977, the sector grew and car rental expanded from big cities to smaller towns in the hinterland.
A big challenge met by the car rental business was resisting government economic plans, inefficient price and salary freezing policies, which among other serious problems, caused the overpricing of vehicles..
Fortunately, car rentals started the 90s facing new challenges and opportunities. The opening up of the domestic market, the Consumer Defense Code, the so-called Popular Car, the Real Plan and Globalization are some of the most important factors in that decade.
The opening of the domestic market made it possible for car rentals to modernize their fleets with imported cars, so as to meet consumer demands for higher quality.
The explosive expansion of credit card use, mainly after the Real Plan, was also positive for the car rental sector, broadening the base of potential consumers. At that time, the most important task was to adjust the administration of the business to the new economic order, since inflation was now under control. However, price stability did not apply to automobiles. So called ‘popular cars’ jumped from approximately R$ 7.3 thousand in price in 1994 to about R$ 15 thousand in 2002. In the meantime, competition among car rental companies intensified. Such a fact, plus the need to enhance productivity and reduce costs, resulted in the drop of daily rental fees of about 30%, from the time of the Real Plan up to the end of 2001.
Again, the Sector overcame the global consequences of the economic crises in Russia, Asia, Argentina and Brazil itself, which demanded shrewd management on the part of all economic sectors. The automobile industry, the largest car rental companies’ supplier, also went through difficulties due to the economic crises, but adjusted itself to the presence of new foreign car manufacturers in the Brazilian market. The wider offer of different models promoted competitiveness among assembly plants and benefited the car rental sector, which year after year has managed to increase the number of users and to promote the growth of operations in Brazil.
La apertura trajo para las arrendadoras la posibilidad de diversificar la flota con coches importados, para así satisfacer a un consumidor que pasó a exigir cada vez más calidad.
La explosión de las tarjetas de crédito, principalmente después el Plan Real, también fue positiva para el sector, al ensanchar la base de potenciales consumidores. Hubo entones que adaptar la administración de los negocios al nuevo orden económico, ya con la inflación bajo control.
Sin embargo, la estabilidad de los precios no se verificó en los automóviles. Los autos populares saltaron de aproximadamente R$ 7,3 mil en 1994 para cerca de R$ 15 mil en 2002. Mientras tanto, la competencia entre las arrendadoras naturalmente aumentó. Tal hecho, aliado a las necesidades de ganancia de productividad y reducción de costos, resultó en la caída de los precios de la tasa diaria de alquiler en alrededor del 30%, desde el Plan Real hasta fines de 2001.
Nuevamente, el sector superó las consecuencias globales de las crisis económicas de Rusia, de Asia, de la Argentina y del propio Brasil, en momentos que exigieron atención y aplicación por parte de todos los sectores de la actividad económica.
La industria automovilística, la mayor abastecedora de las arrendadoras de autos, también atravesó dificultades con las crisis económicas, pero se adaptó a la entrada de nuevos fabricantes. La mayor oferta de modelos promovió la competitividad entre las montadoras y benefició el sector de alquiler de autos, que año tras año viene ampliando el número de usuarios y promoviendo el crecimiento de la actividad en Brasil.
The history of Car Rental in Brazil is quite recent. It started in the 1950s, a romantic time when car models such as the Beetle (Fusca), Dauphine, DKW, Aero Willis, Simca and Karman Guia, etc., circulated along Brazilian streets, avenues and highways. By that time, the automobile industry had been successfully stimulated by President Juscelino Kubitschek’s Targets Plan.
The first car rental businesses appeared in downtown Sâo Paulo, where some used car dealers started to rent cars as a complementary activity. One of these businessmen, Mr. Adalberto Camargo, envisioned car renting as a promising business. The moment was favorable; economic activities were growing and the country needed new means of transportation.
In 1956, Mr. Camargo joined together with entrepreneurs of other economic sectors so as to raise capital in order to finance his new company: Auto Drive S.A. Indústria e Comércio, the first company founded with the exclusive purpose of renting cars. The first cars rented out by the company were Volkswagen Beetles. These were rented to Brazilian customers who had traveled abroad and taken notice of how convenient it was to rent cars.
After this pioneering enterprise opened, other car rental businesses were created, although in the beginning this activity had to surmount great difficulties, such as cut-throat competition and the excessive wear-and-tear of cars due to the very poor conditions of roads at that time.
Expansion of the Business
In the mid-60s, the activity had a great boost when it was inspired by the North American car rental business. That influence was necessary at the time, and the business began to professionalize quickly in Brazil. Then, car rentals started to include contracts signed with companies that used fleets. Thus, the long-term rental emerged.
In the 70s, the first leasing companies appeared, through which it was possible to leverage the development of Car Rental companies, as long-term financial operations became available.
By the end of this decade the first alcohol fueled cars were made, a true corner-stone of Brazilian industry, as the country adjusted to the world-wide oil crisis. Car rentals started to use alcohol driven cars in great number, thus helping to popularize this type of vehicle throughout Brazil.
By then, car rental was a consolidated activity in Brazil, and as abroad, international car rental chains started to operate in Brazil.
Similarly, Brazilian car rental companies started to form chains using the franchising system. The rental of vehicles expanded considerably
Car rental know-how spread around the country and small regional companies were then founded. Such expansion caused the need to create an Association that would gather the pioneers of this new business around common objectives, such as: defending the interests of companies in the Sector, professionalizing the activity, advertising it and fighting cut-throat competition.
Sooner than expected, the rather chaotic economic environment of the 80s proved how relevant the organization of ABLA had been.
The unreliable economic environment in the 80s caused the economy to stagnate thus preventing economic growth, leading to the so called "lost decade". Despite the fact, supported by ABLA, which was founded on the 30th of March, 1977, the sector grew and car rental expanded from big cities to smaller towns in the hinterland.
A big challenge met by the car rental business was resisting government economic plans, inefficient price and salary freezing policies, which among other serious problems, caused the overpricing of vehicles..
Fortunately, car rentals started the 90s facing new challenges and opportunities. The opening up of the domestic market, the Consumer Defense Code, the so-called Popular Car, the Real Plan and Globalization are some of the most important factors in that decade.
The opening of the domestic market made it possible for car rentals to modernize their fleets with imported cars, so as to meet consumer demands for higher quality.
The explosive expansion of credit card use, mainly after the Real Plan, was also positive for the car rental sector, broadening the base of potential consumers. At that time, the most important task was to adjust the administration of the business to the new economic order, since inflation was now under control. However, price stability did not apply to automobiles. So called ‘popular cars’ jumped from approximately R$ 7.3 thousand in price in 1994 to about R$ 15 thousand in 2002. In the meantime, competition among car rental companies intensified. Such a fact, plus the need to enhance productivity and reduce costs, resulted in the drop of daily rental fees of about 30%, from the time of the Real Plan up to the end of 2001.
Again, the Sector overcame the global consequences of the economic crises in Russia, Asia, Argentina and Brazil itself, which demanded shrewd management on the part of all economic sectors. The automobile industry, the largest car rental companies’ supplier, also went through difficulties due to the economic crises, but adjusted itself to the presence of new foreign car manufacturers in the Brazilian market. The wider offer of different models promoted competitiveness among assembly plants and benefited the car rental sector, which year after year has managed to increase the number of users and to promote the growth of operations in Brazil.
La apertura trajo para las arrendadoras la posibilidad de diversificar la flota con coches importados, para así satisfacer a un consumidor que pasó a exigir cada vez más calidad.
La explosión de las tarjetas de crédito, principalmente después el Plan Real, también fue positiva para el sector, al ensanchar la base de potenciales consumidores. Hubo entones que adaptar la administración de los negocios al nuevo orden económico, ya con la inflación bajo control.
Sin embargo, la estabilidad de los precios no se verificó en los automóviles. Los autos populares saltaron de aproximadamente R$ 7,3 mil en 1994 para cerca de R$ 15 mil en 2002. Mientras tanto, la competencia entre las arrendadoras naturalmente aumentó. Tal hecho, aliado a las necesidades de ganancia de productividad y reducción de costos, resultó en la caída de los precios de la tasa diaria de alquiler en alrededor del 30%, desde el Plan Real hasta fines de 2001.
Nuevamente, el sector superó las consecuencias globales de las crisis económicas de Rusia, de Asia, de la Argentina y del propio Brasil, en momentos que exigieron atención y aplicación por parte de todos los sectores de la actividad económica.
La industria automovilística, la mayor abastecedora de las arrendadoras de autos, también atravesó dificultades con las crisis económicas, pero se adaptó a la entrada de nuevos fabricantes. La mayor oferta de modelos promovió la competitividad entre las montadoras y benefició el sector de alquiler de autos, que año tras año viene ampliando el número de usuarios y promoviendo el crecimiento de la actividad en Brasil.