How has the business advanced in recent years?
Al Wefaq Rent a Car was established in 2000 when the market was experiencing significant growth levels; although the car rental market was immature, there were a lot of business opportunities. Some businesses became successful because of their vision and action plans, while others exited the market. In 2010, the owner of Al Wefaq Rent a Car decided to separate the ownership of the company from the management and set KPIs along with short- and long-term goals for the company. Due to the high potential in the market, several international players showed interest and approached us to represent them in Saudi; we decided to represent Dollar Rent a Car and continue to hold their franchise. The Saudi car rental market is different compared to other countries, especially other GCC countries. In Dubai, more than 90% of the population is made up of expatriates, while here it is the opposite. Most of our clients are locals, and they prefer to deal with local brands, even though there are international companies operating here. The government's introduction of new regulations for the car rental industry has redefined industry practices. The car rental business is not limited to renting cars only; security is another significant concern. Al Wefaq Rent a Car is among the top-five players in the Kingdom and has always focused on providing the best services, offers, and promotions for its valued customers.
Al Wefaq Rent a Car has predominantly been a B2C business. With your arrangement with Dollar, are you also increasing your B2B offerings?
Al Wefaq corporate leasing and fleet management solutions are renowned in the region. Though Budget and Auto World are big in corporate leasing as they have been in the market for a long time, our quality has enabled us to grab good market share in the B2B market. We do not have any plans to change the Al Wefaq Rent A Car brand to Dollar as we have already started signing franchise agreement for Al Wefaq Rent a Car trademark. We operate directly in international cities such as Dubai and Cairo, and we have one franchise in Amman, Jordan. Moreover, we are set to provide franchising rights in Kuwait in the near future. Turkey and Morocco are other potential franchise markets and from there, we might go to Asia Pacific, Europe, and the Americas.
What are your expectations of the impact of women being allowed to drive on the industry?
This offers great potential for us. Saudi women already rent cars from us in places such as Dubai, Cairo, and Oman. They have driving licenses from Bahrain, the UAE, the US, and Europe. Perhaps for the first few months, there will be some challenges, but things will change and we will have a new group of clients. Al Wefaq Rent A Car's business is mainly B2C, and we are present in 18 airport locations in Saudi Arabia. Women drivers offer us great potential, but we have to align our products services to suit women. Certain sectors see this change as a disadvantage because car insurance premiums will go up; however, we see it as an opportunity.
Where do you envisage your growth over the coming years, and what are your future plans?
In previous years, the car rental industry as a whole used to grow with new projects, more employment, local business travelers, and people traveling frequently to visit their families. Things are changing now because people's costs are increasing with new regulations such as VAT. Therefore, growth within the sector is relatively small. Several car rental companies that have been operating for 20 or 30 years are shutting down, and this is an opportunity for the companies that are focused and investing wisely to gain a greater share of the existing pie.