NewsLocalCar rental companies in dire financial state due to pandemic

Car rental companies in dire financial state due to pandemic

Car rental companies in tourist areas estimate lost revenue this year to exceed €120 million compared to the over €135 million amounted in 2019.

Prokopis Georgiou of the Pancyprian Association of Tourist Vehicle Rental Businesses told Philenews that from the so far very disappointing tourism indications, the industry estimates that only 10 to 15% of last year’s revenue will come in. And this amounts to €13-14 million.

Car rental companies in Cyprus maintain a fleet of about 18,000 vehicles.

Their largest turnover is based on tourists from two countries – mainly Britons who rent an average of 53% of available vehicles and Russians with about 19%.

A significant percentage of the rentals will not even “start up” to warm up their engines this year. And this will have significant consequences in the condition of these vehicles with painful maintenance costs for the companies that own them.

In addition to these consequences, the loss of income for gas station owners needs to be accounted for, as well as the state’s losses in terms of tax collection, he added.

Another side effect due to the pandemic is the loss of revenue for car maintenance service businesses whose turnover will also be significantly reduced.

A lot of businesses in the industry are facing potential bankruptcy, he warned.

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