Tourism Holdings (THL) is looking to cut its global fleet by nearly a third and concentrate on domestic customers in key markets to see it through the lockdown in international travel.
The campervan rental company operates in New Zealand, Australia, and the United States, and its brands include Maui and Britz.
It said business all but dried up during the lockdown in the three countries, but as internal travel has started to resume it is planning to sell vehicles to pay back debt.
Tourism Holdings said it managed to more than halve its expenses during the lockdown and cut debt by nearly a third, but said it needs a new approach to get through the coming year.
“Our current assumption is that THL will operate in a domestic-only environment for the majority, if not all, of financial year 2021, but we will retain key capabilities and the ability to efficiently meet demand once international travel flows resume,” the company said in a presentation.
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Its plan is to reduce its fleet size by about 30 percent that will mean selling between as many as 2350 vehicles in its three key markets, which it will use to further reduce debt.
“We expect to grow the domestic market in New Zealand, Australia and the United States, however replacing international bookings with domestic bookings will not provide the same level of returns due to the nature of the domestic market,” it said.
It was aiming to increase the number of New Zealand domestic customers five-fold, at least double in Australia, and try to hold the line in the US.
The company said it expects to be cash flow positive over the next 12 months which will be underpinned by vehicle sales.
Source: rnz.co.nz Republished by arrangement.