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Letter to the Editor
This article originally appeared in the November 2006 Issue of INSIGHT
©2006 Collision Repair Industry INSIGHT All Rights Reserved
Sherwin-Williams Appoints Morikis President and COO
Genuine Parts Company Reports Record Q3 Sales and Earnings
AutoNation Joins Plug-In Partners Campaign to Support Manufacture of Plug-In Hybrid Vehicles
GM and Ford Implement OEConnection’s CollisionLink
PPG Records Charges for Environmental Remediation and Class-Action Settlement
CARSTAR Appoints Evans Director of Franchise Sales
Mitchell Holds First Annual Drive2Performance Collision Repair Conference
Ford’s Recovered OE Parts Pilot Goes National
Snap-On to Purchase ProQuest Business Solutions
SCRS Questions American Family Insurance’s Estimating System Vendor Change
Enterprise Rent-A-Car Partners with National Arbor Day Foundation on 50 Million Tree Pledge
INDUSTRY UPDATE
The Sherwin-Williams Company has appointed John G. Morikis as President and Chief Operating Officer, effective October 18th.
Morikis has held many key positions during his twenty-two year career with Sherwin-Williams, most recently as President of the Paint Stores Group, the company's largest and fastest growing business segment. During Morikis's seven-year tenure as President of the Paint Stores Group, the segment has increased from approximately $3 billion dollars in sales through 2,400 company operated paint stores to 2005 sales of nearly $5 billion through more than 3,100 stores throughout North America. Under his leadership, Sherwin-Williams has introduced many innovative products, which have solidified Sherwin-Williams' position as a leading architectural coatings company in North America.
Morikis joined Sherwin-Williams in 1984 as a management trainee. During his career, he has held numerous positions of increasing responsibility in the Paint Stores Group, including President & General Manager, Eastern Division; Senior Vice President - Marketing; and Vice President - Sales, Eastern Division.
In his new role, Morikis will be responsible for all operating segments of the company, which includes the Paint Stores Group, the Consumer Group, and the Global Group.
Christopher M. Connor, Chairman and CEO, commented, "We are extremely pleased that our Board of Directors has appointed John as our President and Chief Operating Officer. John has had a long and distinguished career with our company, rising up through the ranks to achieve this position. John's success over the years has been due to his focus on meeting customer needs, understanding the coatings market and his dedication to hiring and developing terrific management teams. I fully expect that John will bring the same energy and passion to this new role, and he will help Sherwin-Williams continue to meet the expectations of our customers, shareholders and employees."
The Board of Directors also appointed Steven J. Oberfeld as President, Paint Stores Group, succeeding Morikis. Oberfeld is also a twenty-two year employee of the company. Oberfeld has served as President & General Manager, South Western Division of the Paint Stores Group since 1992. He has led the company's growth in many of its largest architectural and industrial marine markets, including Texas, California, Arizona, and Kansas.
Commenting on Oberfeld's appointment, Connor said, "Steve Oberfeld has been an outstanding manager for our company for a long time, managing one of the largest businesses we have. I am confident that Steve will provide the direction and leadership to the Paint Stores Group in continuing our growth and meeting the needs of our customers. I am also pleased that our management development and succession plans have allowed us to promote highly qualified performers to their new roles, insuring continuity of our business plans and processes."
The Sherwin-Williams Company, founded in 1866, is one of the world's leading companies engaged in the manufacture, distribution and sale of coatings and related products to professional, industrial, commercial, and retail customers.
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Genuine Parts Company has reported record sales and earnings for the third quarter and nine months ended September 30, 2006. Sales totaling $2.7 billion were up six percent compared to the third quarter of 2005. Net income was $121.3 million, an increase of nine percent, compared to $110.9 million for the third quarter of 2005.
For the nine months ended September 30, 2006, sales totaled $7.9 billion, up seven percent compared to the same period in 2005. Net income for the nine months was $355.9 million, an increase of eight percent over $328.4 million recorded in the previous year. Earnings per share on a diluted basis were $2.06, up ten percent compared to $1.87 for the same period last year.
Tom Gallagher, Chairman, President, and Chief Executive Officer, stated, "We are pleased to report record levels of revenues and earnings for the 3rd Quarter of 2006. Again this quarter, each of our four business segments contributed to the overall sales growth for the company. Motion Industries, our Industrial Group, grew sales by 11 percent, and EIS, our Electrical Group, posted a 23 percent sales increase for the quarter. Business conditions in the industries served by the industrial and electrical operations have remained strong and we are expecting another period of good results from these groups in the fourth quarter. S.P. Richards, our Office Products Group, generated a five percent sales increase for the quarter and the Automotive Group increased sales by one percent in the quarter. Our ongoing sales initiatives, combined with positive business indicators in all four of our businesses, provide each of our segments with continued growth opportunities in the fourth quarter of 2006 and we anticipate solid performances from all four groups."
Gallagher added, "The company also continues to generate consistent and steady cash flows and our cash position remains strong. Our priorities for cash remain, first, the dividend, which was increased in 2006 for the 50th consecutive year. Another priority for cash has been opportunistic share repurchases and, as part of our share repurchase program, we have purchased 2.9 million shares of our company stock thus far in 2006. Other key uses for cash remain the ongoing reinvestment in each of our businesses and strategic complimentary types of acquisitions."
Genuine Parts Company is a distributor of automotive replacement parts in the U.S., Canada, and Mexico.
AutoNation, Inc., America's largest automotive retailer, has joined the Plug-In Partners campaign calling on automakers to manufacture plug-in hybrid electric vehicles.
"The development of plug-in hybrids could reduce America's addiction to oil," said AutoNation CEO Mike Jackson. "These new hybrids would offer consumers a 50-mile all-electric range, get the equivalent of 100 miles per gallon, be fully recharged at night and deliver all the performance and comfort of traditional gasoline-powered vehicles without the damaging emissions. We believe Americans will buy these vehicles, which is why we want to sell them."
The Plug-In Partners campaign, launched in January 2006 by the City of Austin and Austin Energy, has attracted nearly 60 cities and counties, including Los Angeles, Dallas, Boston, Philadelphia, Chicago, San Francisco, Baltimore, and Phoenix, as well as dozens of environmental, national security organizations, business, and utility partners. The coalition is working with its partners to generate "soft" fleet orders to demonstrate the potential market for plug-in hybrid vehicles. It also has begun a nationwide petition drive for individual consumers to express their support and interest in buying a plug-in hybrid vehicle.
Austin Mayor Will Wynn said, "AutoNation's support of the Plug-In Partners campaign demonstrates the growing momentum for the manufacturing of plug-in hybrids. Mike Jackson certainly knows what type of vehicles that Americans will buy. We salute his commitment to help us reduce this country's dependence on foreign oil and decrease greenhouse gas emission while also lowering fuel costs for consumers."
Contrasting plug-in hybrids to the limited range of earlier electric vehicles, Jackson added, "Next-generation batteries are significantly more powerful and can tolerate discharging and charging much more forgivingly than earlier versions. That opens up the possibility of creating a vehicle that will deliver genuine benefits to consumers and society."
Additional information about the campaign is available at www.pluginpartners.org.
AutoNation, Inc., headquartered in Fort Lauderdale, Florida, is America's largest automotive retailer and a component of the Standard and Poor's 500 Index. AutoNation has approximately 27,000 full-time employees and owns and operates 333 new vehicle franchises in 16 states.
OEConnection LLC, a provider of e-commerce parts exchange and analysis solutions for the automotive original equipment replacement parts business, has announced a marketing partnership with Ford Motor Company and General Motors for the national deployment of CollisionLink, OEConnection's technology for fast, accurate, online fulfillment of original equipment replacement parts to collision shops.
GM and Ford now recommend CollisionLink to their wholesale dealers in recognition of this online technology being a significant advance towards improving efficiency and quality for the collision repair industry. This implementation establishes a national base of wholesale dealers processing online collision parts orders.
With CollisionLink, dealership wholesalers can significantly transform their order processing experience using online automation accuracy to help eliminate parts returns. CollisionLink electronically sends shop parts orders to dealerships. Parts departments are able to eliminate non-productive, order-taking phone time and process parts orders with speed and accuracy using CollisionLink's automatic part validation and instant VIN-based error- checking.
For collision repairers, CollisionLink's more accurate parts order system helps speed-up vehicle cycle time, reduce supplemental ordering, eliminate returns, and enhance overall supplier relationships and order response time.
OEConnection President and CEO Chuck Rotuno said, "Ford and GM's support of CollisionLink to their wholesale dealers validates the importance and value of online parts ordering and streamlining this historically cumbersome business process. CollisionLink is helping these OEMs provide their dealers with tools to better service collision repairers and insurance companies, and, simultaneously, provide a technological competitive edge."
GM and Ford launched CollisionLink to their network of larger wholesale dealers through an aggressive schedule of nationwide regional meetings and dealer visits beginning in May 2006. At these sessions, wholesalers received hands-on demonstration and use of CollisionLink in an effort to spur rapid national adoption.
OEConnection is a joint venture created by Ford Motor Company, DaimlerChrysler, General Motors, and ProQuest. OEConnection solutions facilitate $8 billion in annual parts trade.
PPG Industries has recorded an after-tax charge of $106 million to account for the estimated cost of proposed environmental remediation of sites in New Jersey and Louisiana. The company also recorded an after-tax charge of $14 million for a proposed settlement of a class-action lawsuit. Combined, these two charges will reduce third quarter 2006 earnings per share by $0.72.
Environmental remediation is expected to occur at PPG's former chromium manufacturing location in Jersey City, N.J., which the company operated in the late 1950s and early 1960s. In addition, remediation is also expected to occur at the Calcasieu River estuary in Calcasieu Parish near the company's Lake Charles, La., facility, where PPG is working with other potentially responsible parties. Both projects are expected to occur over a number of years.
"PPG is a member of the American Chemistry Council's Responsible Care initiative, and we take our commitment to the environment seriously," said Charles E. Bunch, chairman and chief executive officer of PPG.
Bunch added that the company's exposure to legacy environmental remediation costs is concentrated in the locations covered by these charges and that they reflect material progress toward resolving these environmental contingencies, which have been disclosed in PPG's financial reports for many years. "The cash flow impact of the environmental charges will be very manageable, as the actual remediation will occur over an extended period of time," he said.
Separately, the company has agreed to settle a federal class-action lawsuit related to alleged antitrust violations in the U.S. automotive refinish industry from 1993 through 2000. The settlement agreement remains tentative, pending formal documentation and necessary court proceedings.
"Based on both PPG's internal investigations and discovery conducted to date, we continue to strongly believe that there was no wrongdoing on the part of PPG. However, settling this case helps us avoid considerable ongoing expense of a prolonged defense, as well as risks associated with a jury trial involving complex issues," concluded Bunch. "Resolving these issues reduces uncertainty associated with the company. Meanwhile, our strong operating cash flows and financial flexibility will allow us to pay these costs while continuing to reward shareholders with organic and acquisitive earnings growth, dividends and share buybacks."
CARSTAR Automotive, Inc. has announced the addition of Paul Evans as its Director of Franchise Sales.
“Paul brings a wealth of knowledge and leadership experience with sales and business development,” said Dick Cross, CEO of CARSTAR. “We are pleased to bring Paul into our franchise sales department and are confident that he will affect positive growth within our network.”
Prior to his appointment to lead CARSTAR development, Evans served as the Regional Service Manager for CARSTAR in the Northeast Region, servicing 27 stores, where he managed franchise systems and operations within each facility. In addition, Evans served as Director of Sales and Marketing for several major metro daily newspaper groups throughout New England and was the managing partner of Evans Media Group, LLC a public relations firm in Danbury, CT.
“I am excited about the current direction and opportunities that lie ahead for CARSTAR and the growth potential of our network,” said Evans. “I look forward to working with the talented team that continues to lead the industry by delivering exceptional value with systems, purchasing, marketing and education for collision repair owners.”
Immediate plans include doubling the size of the sales team and instituting a new selling system.
“As collision repair continues to evolve, being a part of it with a true industry leader is exciting,” said Evans. “For many, the future is unclear, but that is not the case at CARSTAR. We actually offer a way for the independent owners to not only take back control of their destiny, but provide a clear understanding of where our industry is headed and how to make the most of it.”
As of September 2006, CARSTAR has added 19 new franchises to their network and renewed 17 contracts with existing franchisees.
Headquartered in Overland Park, Kansas, CARSTAR is the largest group of auto body repair shops in North America. The privately held company currently has over 275 locations in 25 U.S. states and the District of Columbia, and 110 Canadian locations.
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Mitchell International held its Drive2Performance first annual collision repair conference in September in San Diego, California. The two-day conference brought together leading industry professionals to explore current and emerging trends impacting collision repairers, and to discuss new strategies, practices, and tools by which shops can remain successful in an increasingly competitive market.
Performance-driven collision repair shops have a distinct advantage over shops operating under a "business as usual" paradigm - an advantage that becomes even greater when they take advantage of opportunities to learn from industry leaders and experts. Mitchell's Drive2Performance seminar provided attendees with an opportunity to hear from numerous experts in a variety of relevant fields, network with their peers and exchange insights in a stimulating environment.
Mitchell's Vice President of Database Development, Tom Fleming discussed the impact of new automotive manufacturing technologies and techniques on collision repair facilities.
"The collision repair industry is undergoing a fairly major transformation from the Way-Things-Were to the Way-Things-Will-Be. To continue to thrive today and into the future, collision repair shops need to harness the power of data analysis to better understand how well or poorly their business is performing and to reveal new opportunities," said Marc Brungger, Senior Vice President of Client Services at Mitchell. "By taking advantage of new information technologies and sophisticated performance management systems shops can avoid driving blindly into the future."
Commenting on the conference, Bruce Cooley of Sherwin-Williams Automotive Finishes, Inc., said, "I found the Mitchell Drive2Performance Conference a very valuable and rewarding experience. The Conference provided key insights into industry trends, market pressures, OEM technology, and optimizing shop management and insurance relationships. The meeting confirmed Mitchell's long-term commitment to the industry and provided great networking opportunities."
Barry Dorn, of Dorn's Body and Paint, Inc. and SCRS Board Director, added, "Mitchell's Drive2Performance conference was a highly valuable and collaborative event. The dynamic exchange of ideas between all attendees was invigorating and tackled the important strategic issues impacting collision repairers. The range of speakers ... offered great insights and provided solutions to the problems that are top of mind for shops. As business owners we need real and practical solutions. Mitchell's Drive2Performance successfully provided ideas and solutions that we can put to use immediately. This promises to be the can't miss event for any collision repair shop interested in improving their business."
Mitchell International provides information and workflow solutions to the Auto-motive Iinsurance Claims and Collision Repair Industries.
Ford Motor Company will expand its Recovered Original Equipment (ROE) Collision Parts pilot program nationally during the fourth quarter of 2006.
The ROE program captures and redistributes slightly blemished Ford collision parts as a cost-effective alternative to non-OEM collision parts. Primary categories of ROE parts include bumper fascias, hoods, fenders and doors.
“Our initial pilot program, while small in scope, has proven the value of ROE parts to the collision repair industry,” said Tom Wenzel, Collision Repair Products Manager for Ford Customer Service Division (FCSD). “The national pilot will provide us with more information and greater reach as we continue to build inventory and set the stage for a full national roll-out.”
The ROE Collision Parts program was created to identify and manage the growing problem of excess, surplus and rejected Ford collision parts filtering into the aftermarket in an uncontrolled manner, while assisting insurers in reducing cycle time and overall severity by providing high-quality replacement collision parts at reduced list prices.
FCSD now captures rejected or excess assembly plant and supplier-produced service parts, as well as dealer inventory returns. It then passes all captured parts through a stringent quality control process and identifies those eligible for the ROE program. The ROE program’s strict quality control measures are intended to assure that:
Parts meet genuine Ford replacement collision parts standards for structural and dimensional integrity, and functionality. Cosmetic damage/blemish will be minor, such as paint or primer runs, dirt in paint or primer, razor cuts in paint or primer, or minor repairable damage in material. In most instances, standard part preparation processes will correct the damage/blemish.
According to a company press release, additional benefits of the ROE Collision Parts program are a more efficient process to identify and recycle certain materials and a measurable reduction in the amount of scrapped material disposed of at landfills.
All ROE parts carry competitive list prices, will be clearly identified and branded as “Recovered” and carry the same service part warranty (excluding cosmetic damage) as genuine Ford replacement collision parts. The parts will be identified by the same part number with a unique “BP” suffix and will be classified in non-OEM categories on all major electronic collision repair estimating systems.
“Our analysis shows that insurers are saving about three percent by using non-OEM collision parts on the average repair,” Wenzel explained. “With ROE parts, we now believe significant repair cycle time and overall severity reductions are possible because repairers can process their entire parts orders through one source – their Ford-Lincoln-Mercury wholesaling dealer. The result will be lower overall cost to the insurer, less hassle for the collision repairer, and greater satisfaction from vehicle owners.”
Snap-on Inc., a maker of tools, diagnostics, and equipment, is purchasing ProQuest Company's ProQuest Business Solutions unit, which provides automotive parts and service information, for about $480 million in cash and the assumption of $19 million in debt.
The acquisition, expected to be completed later this month, according to Snap-on will help build up its diagnostics and information group.
ProQuest Business Solutions products include integrated software, services and systems, warranty management systems, and analytics.
The Society of Collision Repair Specialists (SCRS) has reported that the recent vendor change in information provider for the American Family Insurance Customer Repair Program (CRP) has caused a ground swell of questions, accusations, and opposition in the Collision Repair Industry. It was only a few years ago that American Family required CRP repair facilities to purchase Mitchell’s estimating software to participate in their program. Repairers signed contracts with Mitchell due to the requirements put forth by American Family Insurance. Unfortunately, the recent change in the insurer's requirements to now purchase estimating software from Audatex, a Solera company, has left many of those repairers in search of answers and with growing resentment.
According to SCRS Executive Director Dan Risley, “When insurers mandate specific vendors for services, they not only restrain the repair facilities' ability to select their preferred vendor(s) but inhibit the efficiency of their operations. The added cost of installing, maintaining, and supporting a redundant estimating system to collision repairers can have an impact on both the cost of repairs and the price of insurance. American Family’s decision to tie participation in its Customer Repair Program with the purchase of Audatex Estimating fails to leverage the technology that facilitates efficient electronic communication regardless of the estimating system”.
Risley continued, “The SCRS has contacted American Family and Audatex to share our members’ concerns. While we have received clarification on the program requirements, the fact remains that American Family’s decision, as currently structured, will raise the cost associated with repairing our customers’ vehicles insured by American Family. We will continue to communicate with American Family so they clearly understand the economic costs associated with their decision and the impact on the repair facilities in the Customer Repair Program.”
As a first step to address some of these concerns, such as long term contracts, prior contract commitments, computer requirements, and higher than expected monthly subscription fees, SCRS contacted Audatex and American Family senior management. The following is a summary of those conversations.
Audatex:
Q: Why are repairers required to sign a 5-year contract?
Q: Can a repairer cancel its contract with Audatex in the event American Family prematurely terminates its agreement with Audatex?
Note: SCRS has been working with Audatex to address these issues. Audatex was requiring a five-year contract so that the repairers on the Customer Repair Program would have a contract that expires concurrently with the American Family Insurance contract in December of 2011. Upon listening to the industry’s concerns, we are pleased to report that they have made a change.
A: Since having rolled out the Audatex- AMFAM CRP Shop Program, we have received numerous requests for a shorter contract term. Audatex is pleased to announce a one-year contract term in response to these requests. The key differences between the two contracts, i.e. five-year versus one-year are as follows: Shops that make a five-year commitment receive a discount of roughly 10 percent relative to one-year contracts. Additionally, shops that make the five-year commitment receive free hardware that comes pre-installed with the Audatex software solution.
Q: Why is the monthly cost of the software higher than ShopLink?
A: Repairers will not be receiving ShopLink. They will receive Audatex Estimating which is a different program. The repairer will also receive additional software as part of the American Family program requirements at no additional cost (i.e. Imaging, Workflow, Aftermarket Parts Locator, Estimate Check, Frame, and one-year subscription to Real Steel). In addition, the repairer will be able to do transactions with one trading partner (American Family). As more trading partners (insurers) approve the use of the program, there is an additional monthly fee for each trading partner. Lastly, the monthly subscription fee includes a free Dell computer. Audatex wants to ensure repairers have the correct hardware to maximize the software’s efficiency and so they can provide the appropriate level of support. Audatex Estimating has different hardware requirements than ShopLink. For example, the new enhanced graphics requires a DVD drive.
Q: If a repairer has ShopLink, are they required to pay the set up/implementation fee?
A: Yes, because the repairer will not be using ShopLink for the American Family program. They will be using Audatex Estimating, and training is necessary.
Q: Since all insurers have not approved Audatex Estimating, is it possible that a repairer could have both ShopLink and Audatex Estimating?
A: Yes
Q: Will those repairers have to pay two monthly estimating subscription fees?
A: No, Audatex will not charge two monthly fees. There will be one subscription fee.
American Family Insurance:
SCRS contacted Henry Ellis, Specialty Claim Manager for American Family Insurance, to voice the many concerns our members and the industry have expressed. These concerns include, but are not limited to, the cost that is being pushed onto repairers that participate in their program. In some instances, repairers have years remaining on their Mitchell contracts. Was there any consideration as to the cost repairers would be saddled with? Mr. Ellis stated that repairers do not have to sign a contract with Audatex, as participating on their Customer Repair Program is a voluntary decision. Any contractual agreement between the repair facility and Audatex does not involve American Family Insurance. He further stated that the contract repairers signed with Mitchell was also their own decision. In short, American Family Insurance made a business decision to change information providers and those that would like to remain on their program need to change to Audatex Estimating.
SCRS:
SCRS is in strong opposition to any insurer forcing or mandating repairers to perform business in a certain manner including requiring specific vendor(s).
SCRS, as a founding member of the Collision Industry Electronic Commerce Association (CIECA), strongly supports CIECA's vision to have an eCommerce-enabled Collision Industry that allows all industry segments to communicate electronically, independent of platform or software used. Due to its strong involvement on these types of issues, SCRS contacted CIECA. SCRS wanted to clarify if there were technical issues surrounding the need for a repairer to have a specific estimating system.
Fred Iantorno, CIECA Executive Director stated, “In today’s environment, ‘mandating’ a specific estimatics vendor is a business issue, not a technical issue. In fact, whenever an insurer ‘switches’ from one estimatics vendor to another, they prove that their systems can “talk” to either one. CIECA has and will continue to encourage an open architecture within the Collision Repair Industry. CIECA has developed and continues to develop data standards that allow communication between different vendors' systems.”
SCRS is willing to work with American Family Insurance in resolving the many outstanding issues that have clearly placed repairers at a disadvantage.
Risley further stated, “SCRS understands American Family Insurance's need to make a decision that is best for its business. Although, in our opinion, they have shown no regard for the negative impact it would have upon the repair facilities participating in their program.”
Over the years, the word partner has been used ostensibly to describe the relationship between insurers and repairers. Under no uncertain terms should the word partner be used in the context of describing relationships where one of the parties can arbitrarily change vendors and require the other party to absorb the additional cost.
SCRS will be sending a formal letter to American Family Insurance to further express the Industry’s concerns, and to request clarity on the insurer's contractual relationship with Audatex. SCRS’s concerns with the American Family Insurance/Audatex contractual relationship extend beyond the estimating system. SCRS intends to share its response at the Collision Industry Conference (CIC) at NACE in Las Vegas, provided a response has been given.
Lastly, the SCRS Board of Directors hopes that other insurers and information providers consider the negative impact these types of requirements have on the entire industry before implementing them.
Risley concluded, “The time has come to stop these types of business practices that are clearly anti-consumer, raise the cost of insurance, and create friction. The industry needs to work together to better serve the consumer with safe and quality repairs at fair prices. Mandating specific estimating vendors does nothing to further these goals.”
To further demonstrate industry solidarity on this issue, the Automotive Service Association (ASA) and Alliance of Automotive Service Providers (AASP) have supported the language in this release and join with SCRS in opposition to the actions taken by American Family Insurance.
Through its direct members and 33 affiliate associations, SCRS is comprised of 5,000 collision repair businesses and 58,500 specialized professionals who work with consumers and insurance companies to repair collision-damaged vehicles.
First Lady Laura Bush joined Enterprise Rent-A-Car Chairman and CEO Andy Taylor, National Arbor Day Foundation Founder and President John Rosenow, Secretary of Agriculture Mike Johanns, and U.S. Forest Service Chief Dale Bosworth in October to launch the Enterprise Rent-A-Car 50 Million Tree Pledge. The ceremonial first trees of the Pledge – several small white pines – were planted by Mrs. Bush and the Pledge partners in the Mark Twain National Forest in southern Missouri to officially launch the program.
Enterprise announced the unprecedented gift to The National Arbor Day Foundation to commemorate the company’s 50th Anniversary. Enterprise will underwrite the planting of 50 million trees over the next 50 years at a total cost of $50 million in today’s dollars. The Enterprise Rent-A-Car 50 Million Tree Pledge partners The National Arbor Day Foundation and the U.S. Forest Service with Enterprise in a long-term commitment to help restore public lands that are badly in need of reforestation.
“We want to credit The National Arbor Day Foundation for this idea,” said Andy Taylor, Enterprise Rent-A-Car Chairman and CEO. “They came to us with the thought of making a long-term commitment in recognition of our 50th Anniversary. We liked the idea so much, we thought why not take this to the next level? This Pledge is our way of saying thanks for our first 50 years by making a really meaningful and significant commitment for the next 50.”
“This gift couldn’t come at a time of greater need,” said John Rosenow, President of The National Arbor Day Foundation. “Last year was the worst forest fire season in history. And unfortunately, 2006 is on pace to be even worse. This gift from Enterprise – the largest gift we’ve ever received – gives us the flexibility to respond quickly to forests damaged not only by fire, but also by storms, disease, and other causes.”
Each year for the next 50 years, with funding provided by the Enterprise Rent-A-Car Foundation, The National Arbor Day Foundation will work with the U.S. Forest Service to plant one million trees in National Forests around the country. These trees will help forests affected by natural disasters and disease, as well as rebuild and preserve habitats for endangered species. The grant also will fund tree-planting initiatives in international locations where Enterprise does business, including Europe and Canada.
“To put this gift in perspective, 50 million trees is the equivalent of planting a new Central Park about every ten days, all year, for the next 50 years,” said Taylor. “We know this commitment is not a total solution, but it’s a solid step in the right direction.”
How The 50 Million Tree Pledge Works
Each year, The National Arbor Day Foundation will identify a number of tree planting projects throughout the U.S. and work with similar agencies to find planting projects in Europe and Canada. Enterprise will fund as many of these planting projects as possible – totaling 1 million trees each year.
The National Arbor Day Foundation will work with the U.S. Forest Service, the public agency charged with protecting and preserving the National Forests, which will plant the trees where they are needed most.
2006 Tree-Planting Projects
The first trees of the 50 Million Tree Pledge already have been planted in several National Forests in great need, in Alabama, Oregon, Michigan, Colorado, California, and Canada.
To learn more about this effort, visit www.arborday.org/enterprise, or www.arborday.org and click on the Enterprise Rent-A-Car 50 Million Tree Pledge icon.
Enterprise Rent-A-Car operates more than 878,000 rental and fleet services vehicles worldwide and has annual revenues of $9.04 billion. Last year, Enterprise opened more than 400 new locations, increasing its total locations to more than 6,900.
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