So yeah, I’m pretty encouraged with the pricing trends.
John Healy: Great. Great to hear. And then just maybe for Izzy, I wanted to talk a little bit on the car side of things, but maybe on the back end of things, on the remarketing side. Any sort of kind of progress that maybe you can point to on those initiatives that maybe change the way you’re selling cars after they run through the fleet and potentially get you a higher quote unquote residual value or disposition price? And maybe where we’re at in terms of kind of those being outlaid and kind of rolling out through the system.
Joe Ferraro: I think I’ll take that, John. So, yeah, we’ve been looking at our disposition strategy for a number of years here now. And whether we sell it direct to dealers or market connect, and we have a certain number of retail lots. And since you asked, I’ll say we’re really in the early phases of a direct-to-consumer platform that will allow us to sell cars digitally on some e-commerce, on an e-commerce way. And like I said, very early on, I think you might even wrote about it in one of our — one of your releases. It’s called RubyCar by Avis. It’s our way that we believe that we can get higher residual values and better aftermarket by selling direct-to-consumer. You know that if we sell a car direct-to-consumer, you always have that available to you.
And the reason why I say like we’re looking at that is because we have — we think we have the right to participate in that. First of all, we manufacture a lot of used cars, right? We buy all these cars new. We differentiate ourselves. We have a lot of used cars. So we have inventory. Second, we have locations to deploy. We have a lot of locations around our airport and supply chain locations, fixed vehicles that we can deploy and deliver, things of that nature. Third is, like I said, we have supply chain. We have mechanics who’ve been fixing cars for a long period of time, both for rental operations and for car sales, both retail and wholesale. And we have customers, right? We have corporate accounts that can use it towards an HR benefit. And we have partners who can use it as a membership perk.
And we’ve established over the past year some technology that allows us to sell cars direct to consumers. And like I said, very early innings, but we’ve sold hundreds of cars. And hopefully we can capture the higher disposition costs as we start giving this more meaningful volume.
John Healy: Great. Thank you, guys.
Operator: Thank you. Our last question is from the line of Lizzie Dove with Goldman Sachs. Please proceed with your question.
Lizzie Dove: Hi, thanks so much for taking the question. I thought the color on DPU was incredibly helpful. It’s just great to hear what you think kind of normal DPU is in 2025 in terms of the improvements that you think you might be able to see there. And I’ll ask my follow-up now, also just any kind of help you can give in terms of international versus U.S. Thank you.
Izzy Martins: Hi, Lizzie. Thank you for the question. I think that unfortunately it’s just way too early to really give you any insights as to what we expect to see in model year, I mean, for calendar year 2025. As I said in my discussions, we expect it to improve from where we’re at. But as I said we’re still in the very, very early stages of the negotiations for the model year ’25. And I hope that what I tried to do in my remarks was to give you kind of a walk down of what’s changing year-over-year. And really what it comes down to is the fleet cost. So you’re spot on, on trying to figure out, okay, which is the same thing we’re trying to do is what is that cost. But as I said, it’s a little bit too early to really try to anticipate what that could be in the next year, other than it should be better than where we’re at today.
Lizzie Dove: Got it. Thank you.
Joe Ferraro: And I’ll take the international part of your question. Look, we’ve been talking about volume not being back to 2019 levels for a number of calls now. I was pleased, however, with the transition from the fourth quarter to the third. We’ve seen volume improve a bit. And I think it’s largely due to our — how the segments are reacting. We’ve commissioned our sales team to drive business out of the United States. We think that’s an opportunity for us. We have tremendous amount of partners and corporate business that we have flowing through our system here that we can utilize in a greater way. And this cross-border business comes at, particularly better pricing and also buys a lot of ancillary and actually keeps the cars longer.
So it has a material effect on utilization, price improvement and volume. And as the quarters progress, it becomes a much bigger part of the international book of business. And that business books early. If you’re going to go to Europe and you’re leaving from the United States, you either made a reservation or you’re looking to make one right now if you’re looking to book into the summer. And we’ve seen some pretty impressive reservation improvements compared to prior year. And I think the bigger thing for us internationally is, it’s definitely segmented by countries and we’re developing this system called our demand fleet pricing system, which centrally manages all our pricing. I think that’s going to be a big benefit for us. We’ll be able to initiate price in various different countries based on price segments and strategies, looking at demand and inventory.
