Why you are really fucked - the REAL TRUTH

A lot of meaningless shit on this site. You can say all you want about how the company sucks, you work long hours, etc and most of it is true.

but.........here is why you are really fucked

Add up what you would make (if you are on commission) without FLIP. FLIP is going to die. Detroit is raising the prices of their cars. One of the major reasons ERAC is buying National/Alamo is to try to further leverage their relationships with Detroit to demand lower prices but Detroit isn't going to bite. Why sell cars to rental car companies for $100 profit, maybe even a loss...just cut production and sell cars profitably. The rental companies have to buy from you and Detroit is starting to realize this - as the industry has grown rental companies need Detroit just as bad as Detroit needs them. Once ERAC has to concentrate solely on making OP things are going to fall apart. Too much giving in to Insurance Companies on rate to battle competition. It will kill them. ERAC has been competing solely on price for a long time - they talk about customer service but you yourself know how great it really it. Airports, local markets all the same - ERAC is the "lowest cost" because it doesn't have value added services (loyalty programs, express check-in, speciality vehicles). ERAC will keep it's marketshare but profit will plunge. Don't worry - the company will still make money ("corp overhead" can be whatever they ened) but you the assistant manager, branch managers, ARM's, will be screwed.

Look at your pay plan. It is based on the prior 12 month performance. How much of that estimated pay from the last year is from flip. What will flip be the next 12 months. You will never make what you are promised. Good luck bringing OP up 50 only to see Flip fall 100! You will always lose. Per unit analysis profit is after everyone has been paid. The AM gets 2-4%, BM gets 4-7%, ARM gets 4%, admin people get .03-.05%. That still leaves over 75% going to big management.

Look at how much of your pay is based on the used car market - something you can't control no matter how good you are. This is going to bite you all in the ass. If you don't think flip is going to change ask yourself where the compact cars are. You are being forced to rent pricier cars at compact rates. You can't afford to carry luxury vehicles anymore. The Mercedes dealerships are getting killed - "don't worry about making OP these managers were told, you'll make big flip" - but it never materalizes. Get out now while you can. ERAC is a decent company in the training and sales experience it gives you and makes you very marketable to other companies. You can get paid what you are worth and get paid off what you can control. Why have your pay determined by FLIP or the lack thereof?

great post and dead on. i knew that 6 months ago. there are alternatives to your equation though but it may piss off people in the united states. buy foreign which every company goes to when they think they lower costs and raise profit. i agree because either way they are fucked. if they pay more to detroit they will have low profits. you would think as a company they wopld have to chance they pay scales acorss the board but since we are talking about enterprise that will proablay nit happen. they shoudl be able to be profitable buying kia's,hyundais, hiowever they would lose dealerships and pro american support. however if they don;t get greedy they can maintain their insurance replacement business and still have it profitable through foreign cars but they have to give up their greed and lay people off.... your right everybody working there is fucked....

sorry terrible spelling.

There are problem with foreign cars though. They hold their value longer but the upfront price is higher. Also, when you buy as many cars as ERAC does each year foreign companies can't meet production because they are lean and mean. Also, foreign companies don't want to devalue their brand. ERAC doesn't rent Honda's because they won't sell to them - it would kill their resale value. Foreign manufactors see what happened to Detroit. It is ok to sell some excess inventory but if you sell a ton it ends up back on the used car market in 2-3 years. Anotherwords, Toyota sells ERAC 10,000 Camry's and in 2 years they are in the used car market. This devalues new Camry's because people would rather spend $5K less on on a 2-yr old car. It is a vicious cycle. Detroit hasn't cared in the last 10 years as the industry has grown because they will do anything for market share and the ability to beat the foreign companies in sales. For example, for years the Taurus was touted as the most popular vehicle in the country based on sales - 75% of which were fleet sales. Detroit is finally going to get smart. It's not that ERAC won't stay profitable, it will, but people in right now are going to get killed.

ERAC people used to make huge money because FLIP was crazy because Detroit sold them cars at breakeven to keep production high and workers employed. As normal people stopped buying American cars they had to sell their cars to someone and rental car companies got great deals. Now Detroit is laying people off, renegotiating with unions, and hiring less people as more people are bought out or retire. This will change the whole business and hurt those who don't have added service features. I am sure ERAC will react and succeed - they do have smart management but the next few years will suck for assistants, branch managers and ARMs. I really don't regret anytime I spent with ERAC but I left at the right time and I was in the loop enough to know what was going on and want to warn others. ERAC has great employees who deserve better.

i left 6 months ago. anytime you leave is the right time but in this case that is very obvious. you're right erac has way too many good people who work there and are deserve better.

That is the great thing about ERAC...they do manage to hire excellent people. I drank the kool aid for a long time and it tastes good. I left about 6 months ago. but then again I made $105K 3 years in and $78 last year as an ARM. There is no reason I should go down except for market trends and flip. You cannot control your own destiny.

good thread, informative

Admin you should consider starting a section "The Long Term effects FLIP trend will have on your potential pay" This would hit a tender spot with higher up who make ungodly money anyway and are struggling to keep the old school dream alive. Think about it, RVPs making $800K are not really gonna cry if FLIP evaporates 25% of there pay away leaving them making $600K, but when an area manager drops from $80K to $60K after puttig in 6 hard years, its time to move on, the days of six figure area managers are really getting more lik folklore today.

Admin set up a forum under current employees as if it is its own group, "The Long Term effects of FLIP on potential pay" I believe this will draw traffic.