Booming figures : XNA rental-car business doesn’t follow the typical curve.
Posted on Sunday, June 29, 2008
Editor's note: This story is part of a monthly series leading up to the 10 th anniversary in November of the Northwest Arkansas Regional Airport's opening.
HIGHFILL - When the Northwest Arkansas Regional Airport opened its doors in November 1998, all eyes were on the sky. It was different seeing multiple airplanes per day land on a runway surrounded by cow pastures and chicken farms just outside Bentonville.
Very little of the buzz - if any - surrounding the airport opening was focused on rental cars. But that changed in a hurry.
"I worked (in the rental-car business ) at the Fayetteville airport before XNA, so I knew what it was like before," said Deanna Kesner, unit manager for the Avis / Budget Group, which represents two of the six rental-car companies doing business at XNA. "Rental-car sales must have increased 10 fold overnight with the opening of XNA. Normally, you can look at the size of an airport and know about what you're going to do in car rentals. XNA just doesn't fit into the ordinary."
Anyone who's traveled to airports of comparable market size has probably noticed a significant difference in the space allocated to rental-car stalls. For instance, at 1, 269 stalls, XNA has more parking spaces dedicated to rental-car sales than the airports at Lubbock, Texas (154 );, Midland, Texas (300 ); Corpus Christi, Texas (231 ); Baton Rouge, La. (327 ); and Shreveport, La. (166 ) combined.
"To say XNA does a fairly healthy rental-car business would be an un- derstatement," XNA director Kelly Johnson said. "But when you have so many business travelers coming and going, you're going to have some big numbers."
Johnson said about 20 percent of the people who land at XNA rent a vehicle. About 90 percent of those rentals are by people coming to do business with Wal-Mart, Tyson or other local companies.
According to XNA statistics, the six Highfill-based rentalcar operations did just under $ 19 million in business in 2007 alone. Since XNA opened its doors almost 10 years ago, it's rental-car tenants have chalked up a combined $ 127 million in sales.
Rental-car businesses sign leases and are considered tenants at XNA, so the airport only sees about 10 percent of that money. But according to Johnson, that small percentage adds up in a hurry.
"That's, in part, what keeps our lights on," Johnson said. "XNA pays thousands per month just on lighting bills. Then there's heat, insurance, maintenance. So there are plenty of bills paid with what comes in. "
In 2007 alone, 119, 207 rentalcar contracts were signed at XNA, averaging out to about 327 per day. Figure in the fact that the rental-car business at XNA tails off significantly from Thursday morning until Monday morning, and you quickly realize XNA does just shy of 500 rental-car contracts per day, Monday through Wednesday alone.
"As good as the rental-car numbers are here, XNA is all or nothing depending on the day of the week," Kesner said. "We can go from 100 percent utilization to 50 percent utilization in just one day. It drops off significantly after Wednesday. But those three or four days at the beginning of the week are hot."
"We talk about the rental-car success here, but anyone who thinks, ' Hey, I should get into that business, ' may want to think twice," Johnson said. "The big companies that have that corporate backing can deal with being significantly slower for a few days. And they can move cars around to get more in here on the extremely busy days."
The annual Wal-Mart Shareholders Week is among the busiest at XNA for both flights and rental-car sales. In fact, there have been a few occasions when a rental-car company has run out of vehicles at XNA during Shareholders Week.
But, for the most part, the companies keep the rental lots full. History tells them the cars are not going to be sitting around long.
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