Rental vehicle operators are often characterised as capital intensive and volatile because of the seasonal uncertainty in demand for tourism-related activities. Companies try to maximise their rental fees and the utilisation of their vehicles by enticing customers to upgrade their services and rent their vehicles for longer periods of time, by optimising when to maintain or sell their older vehicles, and by acquiring distributed operators to leverage their combined operating efficiencies and the geographic availability of their vehicles. Specifically, THL has indicated its near-term focus is to: continue expanding the geographic scope of its operations and its fleet size, especially across the United States including its joint venture TH2; attract more customers through better quality customer experience; continue to seek further value-accretive acquisitions [1]. As with most vehicle retailers, the number of new and used vehicles it sells and the average gross margin it earns on the vehicles it resells are two of THL’s other important value drivers. In order to sell more vehicles at a higher gross margins, THL has recently expanded its New Zealand presence by reducing the excess fleet carry over from the prior year [1].
THL competes directly with several smaller domestic and international campervan rental companies that are also trying to attract customers through various pricing, quality and other customer propositions. These include Apollo Motorhomes and Jucy Rentals in New Zealand and Australia, and Cruise America in the United States. It also competes indirectly with rental car companies, regional accommodation providers, domestic airlines and other travel operators.
THL owns and operates several reputable vehicle rental brands and has established a strong incumbent market position within New Zealand and Australia. It also has operations in a number of different countries, giving it the ability to allocate more of its resources to countries with favourable demand drivers and exchange rates, and vice-versa. Going forward, it should benefit from increased sales and economies of scale through organic growth, new vehicle and service offerings as well as expanding into new sectors and geographies. Its downside commercial risks could include: a broader economic slowdown, both domestically and in the countries from which international tourists originate, which could affect the number of potential tourists and the propensity of those tourists to hire or purchase its campervans; erosion of market share and gross margins from new and existing competitors as well as alternative travel operators; an appreciation of the NZD, AUD and USD, which could make New Zealand, Australia and the united States more expensive travel destinations for some international passengers; an appreciation of the NZD, should it wish to expatriate capital generated outside of New Zealand; increased vehicle safety and environmental regulations that may increase its compliance costs or prevent it from renting or selling certain vehicles in some markets; or the inheritance of undue liabilities or commercial risks through other mergers and acquisitions or its entrance into new countries and sectors.
1984: THL, originally The Helicopter Line, was formed in 1984 through the merger of three New Zealand scenic and charter helicopter companies. It was listed on the New Zealand Stock Exchange (THL.NZ) in 1986 and began to diversify its interests shortly thereafter. It acquired: the Treble Cone Ski Field in 1987; several domestic campervan rental brands and vehicle fleets in 1988 including the Budget, Newman’s, Mount Cook, Horizon Holidays and Maui brands; Kelly Tarltons Underwater World in 1990; a portfolio of hotels and tourism operators in 1992; and the Mechanics Bay Auckland surveillance and rescue helicopters in 1992
1993: THL first entered the Australian tourism market through the acquisition of Sunseeker Motorhomes and in the same year it also introduced its Maui brand into Australia
1994: THL continued to expand and diversify its Australian interest by acquiring TravelMarvel, an Australian and New Zealand travel agency and tourism operator
1995: THL first began to manufacture and retrofit its own campervans in New Zealand through the 60% acquisition of Ci Munro. It also acquired a 50% interest in the Kiwi Experience and Oz Experience hop-on-hop-off guided bus tour operators
1996: THL first entered the Southern African tourism market through the introduction of its Maui brand by way of a joint venture with Imperial Holdings. During the year, The Helicopter Line was also renamed Tourism Holdings (THL.NZ)
1997: THL acquired the remaining 40% of Ci Munro that it did not already own
1998: THL acquired a range of businesses from Air New Zealand’s Mount Cook Group, including Ski Shuttle, Ski Express, Mount Cook Tours, Mount Cook Landlines, Mount Cook Ski Planes and a partnership in Mount Cook Flightseeing
1999: THL expanded its New Zealand, Australian and Southern African campervan rental operations through the acquisition of Britz Motorhomes. It acquired the management license to the Waitomo Caves and it also undertook a full strategic review of its operations, which saw it divest most of its non-core hotel and travel agency businesses
2000: THL chose to exit Southern Africa by selling its Britz and Maui Campervan operations. During the year, it acquired the remaining 50% interest in Kiwi Experience and Oz Experience that it did not already own
2002: THL continued to sell its none-core businesses, which included the Treble Cone Ski Field and most of its scenic airline and helicopter operations
2003: THL acquired The Legendary Blackwater Rafting Company, which owned the license to operate cave rafting through the Waitomo caves
2004: THL further expanded its New Zealand and Australian campervan operations by acquiring the Hertz and Cruise motorhome fleets
2005: THL sold Oz Experience, its Australian hop-on-hop-off guided bus tour operator
2007: THL expanded its vehicle maintenance and customisation operations by acquiring Action Motor Bodies, which was subsequently merged into Ci Munro. THL launched Explore More, its first affordable campervan rental brand in New Zealand. It also continued to rationalise its business interests by selling most of its travel agencies, tourism operators, coach businesses and the Kelly Tarltons Aquarium
2010: THL first entered the American tourism market through the acquisition of Roadbear Recreational Vehicle Rentals and Sales
2011: THL rebranded Ci Munro as Motek in New Zealand and Australia. It also ceased its low-cost New Zealand campervan rental operations under the Explore More brand
2012: THL expanded its New Zealand and Australian campervan rental operations through the acquisition of KEA Australia and the subsequent merger with KEA Campers in New Zealand, which also owned United Campervans. It also expanded its vehicle maintenance and customisation operations through a 50:50 joint venture with KEA Manufacturing to form the RV Manufacturing Group in New Zealand. THL established its first smaller campervan vehicle fleet through the introduction of its Mighty brand
2013: THL introduced the Britz Motorhomes brand into the United States
2015: THL first entered the European tourism industry through the 49% acquisition of the Just Go motorhome rentals and sales business in the United Kingdom. During the year, the RV Manufacturing Group was renamed Action Manufacturing Group and THL opened its second New Zealand RV Super Center in Christchurch. It also tried to expand its online presence by purchasing a travel App in New Zealand called Geozone and launching a new online peer-to-peer booking platform, akin to Airbnb for campervans, called Mighway
2017: THL acquired El Monte, a large recreational vehicle sales and rental operator in the United States. It also acquired 23% of a United States travel app called Roadtrippers, which included the integration of Geozone with the aim of expanding it operations into Australia and New Zealand
2018: THL formed a 50:50 joint venture called TH2connect with a campervan manufacturer, Thor Industries, to create a digital platform in the United States that would facilitate campervan owners planning and booking trips, monitoring systems remotely, roadside assistance and peer-to-peer campervan and campsite renting. As part of the transaction, THL sold its Mighway business and interests in Roadtrippers to TH2connect
2019: TH2connect merged its Australasian road trip planning and camping app businesses, Campermate and Roadtrippers, with GoSeeAustralia and Outdoria to create a combined outdoor tourism marketplace where users can plan trips and purchase outdoor and camping equipment
2020: The global Covid-19 pandemic forced major nations to temporarily close their borders and restrict people’s movements. This caused major disruptions to supply-chains, employment and consumer demand in almost every sector