AVIS TO SWITCH TO GM MODELS

Avis Inc. will switch to General Motors as its major supplier of daily rental vehicles, dropping Chrysler, its present major supplier, as of next September 1. Currently, Avis leases an average of 53-percent of its 69,100-car rental fleet from Chrysler. The agreement with GM was announced by David Mahoney, chief executive officer of Norton Simon Inc. Norton Simon acquired Avis last July. The switch to GM means that Avis will be purchasing a large portion of its fleet rather than leasing it. Chrysler leased the cars and at the end of the lease period, took the vehicles back and dis­posed of them as used cars. Chrysler's joint advertising agreement with Avis is cancelled for the 1979 model, but the GM contract provides a similar agreement on advertising. According to estimates, Avis buys or leases more than 100,000 new cars each year, with Chrysler supplying the majority since 1965.

SUBARU ENTERS LEASE-RENTAL FIELD

Subaru of America, Inc. has announced that it is entering the car renting and leasing field with about 125 dealers signed up in the program to date. The company estimates that they will have 300 dealers participating by the end of the year. The program, which will be administered by First Lease, Inc., a subsidiary of the First National Bank of Chicago, will allow Subaru's 600 dealers across the country to participate in daily rental and long-term open-and closed-end leasing. The program includes insurance, promotional and advertising benefits for dealers. Subaru recently registered a record 66.2-percent increase in year-to-date sales. Pictured are Gene Egan, national sales man­ager and Nancie King, public relations coordinator.

OPEN-END LEASING GIVEN BOOST BY CALIFORNIA COURT

A California court recently ruled that an open-end lease is not a disguised conditional sales contract. The question of the conditional sales contract arose after the enactment of the Muscone Leasing Act in California which was designed to protect consumers leasing primarily for personal use. It has been argued that an open-end lease with capitalized cost reduction and an option to purchase the vehicle at the end of the lease period is a disguised conditional sales contract. As a result, several California banks involved in leasing would not accept the capitalized cost reduction contracts. The court action arose when a leasing company repossessed a lease vehicle as a result of delinquent payments and sent a termination notice to the lessee along with a bill for addi­tional rental due, attorney fees and costs. The lessee filed a countersuit charging that the lease was not enforceable since it was a disguised conditional sale. Both the trial and appeals court found that the open-end lease written under the guidelines of the Muscone Leasing Act was a valid lease and not a disguised conditional sales contract.

HERTZ TO SELL USED RENTAL TRUCKS

A new national program to sell low-mileage, late-model rental trucks at the company's used car lots has been announced by the Hertz Corporation. The company will sell lightweight panel vans and pickups from a number of Hertz Rent A Car Division's 100 outlets. The Hertz Truck fleet ranges from small Econoline delivery vants to 18-wheel, five-axle tractor-trailer rigs. The rental vans selected for retailing initially will be units in service about 18 months with an average of 25,000 to 30,000 miles of use. In the future, lower-mileage lease units with one to three years service also may be railed. A Hertz executive said all the units will be reconditioned and repainted and will be sold with 12 months/1,200 mile limited warranties.