Avis Cuts Fleet as Summer Demand Trails Expectations

Avis Cuts Fleet as Summer Demand Trails Expectations Avis Budget Group increased second-quarter earnings despite lower Americas revenue and softer-than-expected summer demand. The company also expanded Avis First and advanced its autonomous fleet operations with Waymo. Chris Brown ・ Associate Publisher Read Chris 's Posts August 2, 2026 The company’s Americas revenue declined 1.9% year over year as rental days fell 2.1%; however, adjusted EBITDA increased 7.7%. Credit: Automotive Fleet 4 min to read Share Note: Auto Rental News reviews public-company earnings calls to identify operating strategies, market conditions, and business developments more so than stock performance or investment analysis. Avis Budget Group reduced its Americas fleet after forward bookings and inbound travel fell below the company’s initial expectations for the summer period, the company reported on its second-quarter earnings call on July 29. Ad Loading... The company entered the second quarter expecting fleet growth tied in part to World Cup activity, America 250, and what it anticipated would be a stronger summer travel environment. Summer bookings in the outer months were still showing mid-single-digit growth in April, but that momentum began to weaken in early May. Broader travel indicators followed a similar trajectory. Year-over-year TSA passenger counts went from approximately flat in April to down 0.7% in May and 1.3% in June. Overseas visitors to the United States declined 8% during the quarter, based on U.S. Customs and Border Protection I-94 data. Avis responded by accelerating vehicle dispositions in April and early May, when used-vehicle values were still seasonally favorable, the company said. Government Affairs Executive Wins Leading Rental Car Industry Award Americas Earnings Rise Despite Lower Revenue Avis Budget Group’s Americas revenue declined 1.9% year over year in the second quarter as rental days fell 2.1%. Adjusted EBITDA increased 7.7%, however, resulting in approximately 100 basis points of margin expansion. Companywide, Avis reported its highest second-quarter adjusted EBITDA margin in three years and maintained its full-year adjusted EBITDA guidance of $850 million to $1 billion. Ad Loading... The Americas fleet ended the quarter 5.4% smaller than a year earlier, its smallest second-quarter fleet since 2021. Because rental days declined by less than half the rate of the fleet reduction, utilization increased by 250 basis points to a second-quarter record of 73.2%. Revenue per day increased 0.2%, excluding currency effects, while revenue per transaction rose 6%. With fewer vehicles available, Avis said it accepted fewer one-day rentals in favor of longer transactions. Although one-day rentals command higher daily rates, management said longer rentals can produce better overall economics by reducing vehicle turns, handling costs, and operating complexity. Avis expects its Americas fleet to remain down by a similar mid-single-digit percentage during the third quarter and plans to continue favoring longer transactions during the peak travel period. Rental Fleet Sales Skating Just Above 2025 Levels Recalls Ground 18,000 Vehicles An industrywide issue, Avis recounted complications with vehicle recalls. Ad Loading... The company had approximately 18,000 vehicles grounded during the second quarter following additional recalls announced by three automakers in April. That was higher than the roughly 15,000 grounded vehicles Avis reported at the end of 2025. Recall campaigns have generated more than $50 million in directly attributable costs during the first half of 2026, before accounting for lost rental revenue. Avis expects the second-half impact to equal slightly more than half the cost incurred during the first six months, assuming replacement parts arrive at the rates promised by automakers. Grounded vehicles also increase depreciation expense. Avis said recalled vehicles carry depreciation per unit that is generally 20% to 30% higher than its fleet average. The experience is influencing Avis’ 2027 fleet planning. CEO Brian Choi said the company is evaluating total cost of ownership and determining which automakers can deliver the most reliable vehicles as it decides where to place more of its future orders. Avis First Expands to More Airports Avis is also expanding Avis First, its premium rental service, as it looks to capture more higher-value airport business. Ad Loading... Since its previous update, the company has introduced Avis First at Orlando International Airport, Washington Dulles International Airport, London Heathrow Airport, and Paris Charles de Gaulle Airport. Avis has also expanded the program’s vehicle selection with high-demand models from Mercedes-Benz and BMW. Waymo Partnership Moves Into Operations Avis has begun managing Waymo’s autonomous ride-hailing fleet in Dallas, adding a new operating business outside conventional vehicle rental. Waymo remains responsible for its autonomous-driving technology and customer acquisition. Once a trip enters the system, Avis handles the physical fleet operation, including maintenance, charging, vehicle uptime, facilities, and supporting infrastructure. Avis assumed operational responsibility in June and has since supported thousands of trips while expanding the Dallas fleet. Ad Loading... Waymo vs. Tesla Robotaxi: Side-by-Side Ride-Hailing Test Highlights Different Approaches to Autonomy Avis has not decided whether its longer-term role will be limited to managing autonomous vehicles owned by partners or could include purchasing and owning AV fleets itself. The initiative places Avis in an emerging field alongside Hertz, which created its Oro Mobility affiliate to manage conventional and autonomous fleets. Oro plans to provide charging, maintenance, repairs, cleaning, depot staffing, and other daily services for Uber’s fleet of robotaxis equipped with Nuro autonomous-driving technology. International Markets Face Added Capacity Avis described the international operating environment as more competitive than the Americas. Inbound travel to Europe weakened during the quarter, particularly from the Middle East, while new rental vehicle registrations increased more than 10% in several of the company’s largest European markets. Avis cautioned that registration data does not capture vehicle deletions but said the influx of new units, combined with lower inbound travel, added pricing pressure. Strategic-account rental volume declined 10% internationally. Meanwhile, the company also suspended Zipcar operations in the United Kingdom. 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