Announcements
Green means grow
Enterprise announces its environmental platform
Turn on the news or open any newspaper or magazine, and one thing is clear: The world is going green.
When Jack Taylor started Executive Leasing 50 years ago with a “fleet” of seven cars, the issue of vehicle emissions had raised few eyebrows among even the most forward-thinking environmentalists. Today, our society adds an increasing amount of carbon dioxide into the air, both from traditional smokestack industries and from vehicle engines. That increase lies at the heart of one of this new century’s greatest debates – the impact of carbon emissions on climate change, or global warming. As an industry leader that relies on automobiles and fuel for its business, Enterprise Rent-A-Car is immersing itself in the environmental discussion and determining what it can do to be part of the solution.
To that end, Enterprise has formally adopted a comprehensive environmental platform as it relates to its fleet of vehicles. The multi-faceted platform focuses on: addressing the environmental impact of the company’s fleet by partnering in 2006 with The National Arbor Day Foundation on a pledge to plant 1 million trees every year for the next 50 years; embracing current commercially viable alternative fuel technology such as gas/electric hybrids and vehicles that can burn high levels of biofuels; and developing long-term solutions through the creation of the Enterprise Rent-A-Car Institute for Renewable Fuels.
The environmental landscape
Twenty years ago, global warming was almost exclusively discussed among scientists and environmentalists. Today, it tops the agenda for politicians, auto manufacturers, corporations and consumers alike. The tipping point has been reached on this issue as our society broadly acknowledges that the costs of ignoring the problem may far outweigh the costs of finding a solution.
Peel away the layers of scientific evidence, public debate and governmental policy, and the heart of the issue boils down to one thing: fuel.
Since the Industrial Revolution, fossil fuels have provided a cheap and convenient source of power. But these fuels come with some strings attached that could directly affect Enterprise’s business.
The first concern is availability. Oil is a finite resource – one that is being steadily depleted. Experts say that within 50 years demand for fuel oil will be greater than the available supply. Geography also affects the price and availability of fuel. The Western world imports large amounts of its oil from some of the most volatile regions in the world, increasing the risk of shortages, supply disruptions and fluctuating prices.
The other factor that could adversely affect Enterprise’s business is the potential for government-imposed restrictions on greenhouse gas emissions from fossil fuels. There is concern among many of the world’s top scientists, who predict that if emissions of carbon dioxide and other greenhouse gases continue at the present rate, a rise in the average global temperature could cause conditions such as an increase in severe storms, melting polar ice caps and migrating animal populations.
This debate has spurred many countries around the world to set standards for carbon emissions, and several states in the U.S. have legislated greenhouse gas emissions limits on some smokestack industries, such as heavy manufacturing and power plants. In 2006, California Governor Arnold Schwarzenegger helped pass a law calling for the reduction of greenhouse gas emissions from all sources, including vehicles, by 25 percent over the next 15 years. Some predict that similar regulations at the federal level will be implemented within that same time frame. Already, President George W. Bush has called for a 20 percent reduction in gasoline consumption by 2015.
Without a proactive approach to the broad range of alternative technologies, companies in the automobile business may face challenges as a result of federal and state regulations that could limit the available fuel supply. Enterprise recognizes its unique position in the rental car industry and has entered the discussion in order to better understand and proactively address these challenges.
Responsible leadership
Jack Taylor founded his company on a simple philosophy: “Take care of your customers and employees first, and growth and profits will follow.” At a time when environmental issues resonate strongly with employees and customers alike, Enterprise, true to that philosophy, is listening. And as the industry leader, the company has accepted the opportunity to set the standard of corporate citizenship when it comes to the rental car industry’s impact on the environment.
Taking care of the environment is the right thing to do. But it is also a business imperative if Enterprise wants to grow and succeed in its next 50 years and beyond. As a company in the business of renting cars, Enterprise needs three things: vehicles that utilize acceptable technology, a plentiful fuel supply to power them and society’s permission to operate them. In its commitment to environmental stewardship, the company is addressing all three.
Enterprise launches its environmental platform
After 50 years in business, Enterprise knows that leadership is not a short-term proposition. That is why the company has developed a comprehensive, long-term approach to taking care of the parts of the world touched by its operations. It’s an approach built on a commitment to ensure the sustainability of Enterprise’s business, as well as the sustainability of the world we all share.
And it’s starting with a million trees.
50 Million Tree Pledge
At Enterprise, fleet growth goes hand in hand with success and profitability. In 2006, the Enterprise fleet grew to nearly 900,000 vehicles – a tribute to the more than 65,000 employees who work so hard to deliver the highest level of customer service.
But as the fleet grows, so does its impact on the environment. So when The National Arbor Day Foundation approached Enterprise to make a long-term commitment in honor of the company’s 50th anniversary, Chairman and CEO Andy Taylor recognized the opportunity to celebrate Enterprise’s first 50 years by making a meaningful and significant commitment for the next 50 years.
“The more we talked about it, the more convinced we were that this was a way to give back that was consistent with who we are and what we believe in,” says Andy. “The need is so great and the positive impact trees have on our world is so immense that we knew this reforestation program was the perfect way to celebrate our anniversary.”
Working with The National Arbor Day Foundation and the U.S. Forest Service in a powerful public/private/non-profit partnership, the Enterprise Rent-A-Car Foundation will underwrite the planting of 50 million trees – 1 million trees a year over the next 50 years in national forests around the country. The grant will also fund tree-planting initiatives in international locations where Enterprise does business, including Europe and Canada. In total, it is a gift of $50 million in today’s dollars.
To put this into perspective, there are about 25,000 trees in New York’s Central Park. This initiative is the equivalent of planting a new Central Park every 10 days, all year, for the next 50 years.
As just one element of Enterprise’s larger environmental platform, the program helps address the impact of the company’s fleet. Trees act as natural air cleaners because they absorb carbon dioxide, store it as food and emit oxygen into the air. According to the U.S. Department of Agriculture, one acre of forest absorbs six tons of carbon dioxide and puts out four tons of oxygen. So the 50 Million Tree Pledge will have a long-term, beneficial impact on air quality as these trees grow to maturity.
For Enterprise, the partnership is also a powerful way to say thanks to the employees, business partners and customers who have driven Enterprise’s success. So far, the response from employees has been overwhelmingly positive.
“After we announced the Enterprise Rent-A-Car 50 Million Tree Pledge, I received more favorable feedback from our employees than for anything else we’ve ever done,” Andy says.
Embracing existing technologies and alternatives
Enterprise is also taking steps in its business operations to use the latest technologies to minimize fuel consumption and related emissions. Today, the company has more fuel-efficient cars on the road than any other rental car company, with 47 percent of its worldwide fleet averaging 28 mpg or better and 28 percent averaging 32 mpg or better. In addition, 33 percent of the vehicles in the company’s U.S. fleet qualify for the Environmental Protection Agency’s SmartWay Seal – a distinction the EPA grants to vehicles that emit relatively low levels of both regulated pollutants and greenhouse gases such as carbon dioxide.
For years, Enterprise has also managed vanpool businesses in several large metropolitan areas. Today, 1,700 vans transport more than 16,000 urban commuters daily, reducing emissions and fuel consumption while easing road congestion.
Alternative fuel technology is providing a growing variety of energy solutions to reduce reliance on fossil fuels. These solutions include gas/electric hybrid vehicles, hydrogen fuel cell technology, ethanol and biodiesel fuel.
Already one of the largest providers of alternative fuel rental vehicles, Enterprise continues to increase the availability of these vehicles in select markets. While Enterprise’s gas/electric hybrid fleet will grow to approximately 3,000 this year, the company’s larger commitment to alternative fuel technology is evidenced in the more than 38,000 FlexFuel cars and light trucks currently available to customers.
In August 2006, Enterprise launched its FlexFuel initiative aimed at maximizing the use of vehicles in its U.S. fleet that have the ability to burn high levels of ethanol-based fuel. These cars employ a technology that allows them to burn the corn-based ethanol fuel blend known as E85 as well as regular gasoline. E85 fuel blends 85 percent ethanol with 15 percent gasoline.
Through this initiative, the company is positioning its FlexFuel cars at branch locations nearest to E85 stations so that it can refuel the vehicles with E85. Enterprise also has marketing materials available to groups such as license plate holders, key tags and mirror hang tags to make customers aware of these environmentally friendly cars and the benefits of fueling them with E85.
“This initiative demonstrates our commitment not only to provide environmentally friendly options for our customers but also to embrace alternative fuel choices when and where they are available,” says Andy.
E85 is renewable, locally produced and produces lower greenhouse gas emissions than conventional gasoline. Unfortunately, it is not readily available in much of the U.S., limited to roughly 1,000 stations primarily located in the Midwestern part of the country.
This limited availability means that only 103 of Enterprise’s branches are located within a mile of an E85 fuel source. But the company continues to reposition its FlexFuel vehicles and hopes to increase the number of cars being fueled with E85 from 1,000 to 3,000 by fiscal year end.
“We are committed to growing the number of FlexFuel vehicles in our fleet and positioning them in parts of the U.S. where they can be fueled with E85,” says Senior Vice President of North American Operations Matt Darrah. “We want to help drive the demand for E85, which in turn will increase the number of stations that sell the fuel.”
“This isn’t just the right thing to do; it makes good strategic sense,” says Andy. “By endorsing ethanol, we are demonstrating that the world’s largest owner of vehicles is willing to embrace alternative technologies as they become available. The people who produce and sell E85 need to know if they make it, we will buy it.”
Good for the environment, good for business
Located in the center of the U.S. Corn Belt, Heartland Group Vice President/General Manager Steve Thomas’ customers are well aware of the impact of E85 on the environment, as well as on their local economy.
“We have had a very positive response to the FlexFuel initiative from both our customers and our employees,” says Steve.
“They view our efforts as important not only on an environmental level but also because by endorsing and purchasing E85, we are strengthening the local farming economy.”
The initiative has also opened doors to new business opportunities. Both Iowa and Virginia now require that all state-owned and state-rented vehicles use alternative fuel technology. As a result, both states have approached Enterprise to become their primary rental car company because of the company’s large number of environmentally friendly vehicles.
And with fluctuating gas prices and an ever-increasing focus on the environment, growing numbers of individual customers are also making purchasing decisions based upon fuel affordability and a company’s approach to environmental issues. Enterprise’s FlexFuel initiative allows the company to listen to its customers and satisfy their needs on both levels while sustaining the company’s success.
“Increasing the number of FlexFuel vehicles in our fleet is a straightforward business solution for us because we can purchase the FlexFuel models at the same cost as those that run on gasoline,” says Matt. “So we can reduce our impact on the environment while continuing to grow our business.”
Jack’s gift
In his 2007 State of the Union address, President Bush called for the United States to reduce its oil imports from the Middle East by 75 percent by 2025. To achieve that goal, his Advanced Energy Initiative calls for an increase in alternative fuel research and production.
To date, this research has resulted in advances such as gas/electric hybrid vehicles, hydrogen fuel cell technology, biodiesel fuel and ethanol. While experts debate the merits and risks of each, research and development of alternative fuel technologies are booming as the automotive industry faces potential legislated fossil fuel restrictions and increasing public scrutiny.
In February, Enterprise made a significant commitment to further advance that research and development when it announced the creation of the Enterprise Rent-A-Car Institute for Renewable Fuels. Working in conjunction with one of the leading plant science research facilities, the Donald Danforth Plant Science Center in St. Louis, the new Institute will work to develop acceptable and affordable alternatives to finite fossil fuels by finding new ways to create fuel from renewable and reliable plant sources.
Creation of the Institute was made possible by a $25 million grant from Enterprise Founder Jack Taylor and his wife Susan. In addition to being yet another plank in the company’s expanding environmental platform, it is also a part of Enterprise’s celebration of its first 50 years in business.
“For 50 years, this company that my father built from the ground up has relied on the availability and affordability of vehicles and fuel,” says Andy. “Today, more than ever, it is essential that we pursue new energy sources that will sustain not only our business but also the environment around us for future generations.”
Biofuels have a lower environmental impact than fossil fuels because ethanol is made from corn and biodiesel from soybeans. When they are burned for fuel, they recycle carbon compounds that are already present in the environment, as opposed to fossil fuels, like petroleum, which take carbon that’s been locked underground for millions of years and add it to the carbon that’s already in the environment.
Because these biofuels are made from crops traditionally used for food, however, there is concern that increasing their use may decrease the world’s food supply. The Enterprise Rent-A-Car Institute’s researchers will work to address this issue. One of their top priorities will be to increase
the yields of corn and soybeans through biotechnology to meet the demand for food and animal feed while also providing the raw material for fuel. They will also work to discover ways to make fuel from corn stalks, switchgrass or other plentiful plant sources that do not affect food supplies.
“Working with a long-term view of the future is what has made Enterprise the corporate leader it is today,” says Danforth Center Chairman Dr. William H. Danforth. “I am pleased that it is using its leadership to fund scientific research that will benefit the future generations of their current customers.”
Positioned for a green future
Enterprise has also begun to look beyond its vehicles for additional ways to address the environmental impact of its operations, over and above its ongoing compliance with all local, state, and federal requirements and regulations.
In all of these efforts, Enterprise recognizes that one company alone cannot resolve the global challenge posed by greenhouse gases. But by embracing current alternative technologies, investing in future solutions and committing to help grow the world’s forests, Enterprise is doing its part to sustain and protect the parts of the world touched by its operations.
“Simply put, we want to be part of the solution,” says Andy. “For our company, it’s about being good stewards – both of our company and of the world around us.”
– Meghan Maguire
