For the first four months of the year, including the key Easter trading period, revenue for Avis Europe was ahead in all customer groups and in all major markets excluding Spain, which was flat on a like-for-like basis. The Group achieved good volume growth, driven by an increase in rentals, with rental length flat on prior year. Following the positive performance in the second half of last year, rental revenue per day continued to improve, benefiting particularly from good execution of the revenue management programme and also overlapping the weak start to 2007.

The strength of the euro is beginning to affect trading, particularly inbound business from the US into Europe and UK outbound business into Continental Europe. However, currency is having a positive effect on the translation of the net cost of the UK activities of the Group.

Fleet costs were higher than anticipated partly due to difficult used car market conditions in both Spain and the UK. Other costs are being controlled tightly and remain in line with plan.

Full-year outlook

For the rest of the year the Group expects continued good volume growth, albeit with slower growth in Spain. The increase in rental revenue per day is forecast to be better to a degree than previously expected.

While the Group is taking actions to mitigate the impact of the difficult fleet market conditions referred to above, overall fleet costs for the full year will be higher. Other costs will continue to be controlled tightly.

Consequently the Group’s expectations, on balance, for the full year outcome remain unchanged, provided that there is no material change to the underlying economic environment.