Rental revenue almost catchs up to exchange revenu

Started by Carolinian, March 05, 2007, 02:13:30

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Carolinian

A recent Wyndham Worldwide press release on financial performance for 2006 gives the following statistics for RCI's revenue:

From Exchanges - $110 million

From Rentals - $105 million

Rental income has almost caught up to exchange income.  Would it be surprising if this is the last year in which RCI makes more money from exchanges than from rentals?  How long before they change the name to ''Rental Condominiums International''?

If you can't find a decent exchange, I guess there should be no mystery as to where the inventory went.
 


Keitht

Rental income catching up with exchange income tells us absolutely nothing about the commitment or otherwise to exchange.  Unless the figures show the growth or shrinkage level of exchange they are meaningless.

Well the only way timeshare owners can show RCI their displeasure at this is not to renew their membership. Simple as that.

Simoncc

The figures quoted in the press relase refer to RCI Global Vacation Network.

According to the Wyndham site this group includes the various Country Cottages outfits and similar European rental only organisations.

I don't see how you can honestly claim that these figures have any bearing on the RCI exchange company activities. I am also suspicious of RCI's activities in this area but quoting mis-leading figures does not help your arguments.
 

Carolinian

It should be clear from these numbers that RCI is moving toward being a rental organization more so than an exchange organization.

And of course their rentals from exchange deposits have put them on the receiving end of some class action lawsuits, which one can follow at www.rciclassaction.com
 

Keitht

quote:
Originally posted by Carolinian

It should be clear from these numbers that RCI is moving toward being a rental organization more so than an exchange organization.




It's entirely possible that RCI is moving toward begin more a rental organisation, but these figures neither support nor refute that assumption.  Increased rental income, and the purchase of specialist rental companies, is not necessarily incompatible with remaining active in the exchange market.  The time to worry is if figures start to indicate stagnation or reduction of the exchange market in real terms, not simple percentage of total turnover.

Simoncc

You need to remember that Cendant has owned many of the rental only companies for years but recently rebranded them under the RCI Global Vacation Network. For the purposes of this argument, it would be useful to know each divisions results but I don't see how this information would be obtained.

The Wyndham press release stated that exchange revenue went up by 8% so I'm sure that they still see exchanging as a major earner for them. Of course, that is probably due to fee increases as much as more exchanges although a recent post on TUG stated that exchange numbers were still on the rise.
 

heather

This topic has been raised by Carolinian on occasions too frequent to count so almost everything that can be said, has been said. I guess we just have to wait for the outcome of the reported lawsuits.

But, one fact in favor of RCI's practice of obtaining rental inventory from resorts still in development, etc. is that those who might never be exposed to the positives of timesharing are now staying at affiliated properties and hopefully looking at the resale market for opportunities to join in. This can only improve the industry.
 

Carolinian

Too many of the RCI rental weeks, however, are from sold out resorts, and that is NOT developer inventory.  Anon and others have clearly set out on other threads where RCI gets this inventory from.  Check the Ask RCI Insider thread, for example.

What RCI's overblown rental system does is compete with resort ownership.  With all of the cheap rentals RCI puts out there, who is going to buy the cow when RCI is providing the milk for pennies?  RCI's rental program is an introduction to timeshare rental NOT timeshare ownership, and that does NOT help the industry.


quote:
Originally posted by heather

This topic has been raised by Carolinian on occasions too frequent to count so almost everything that can be said, has been said. I guess we just have to wait for the outcome of the reported lawsuits.

But, one fact in favor of RCI's practice of obtaining rental inventory from resorts still in development, etc. is that those who might never be exposed to the positives of timesharing are now staying at affiliated properties and hopefully looking at the resale market for opportunities to join in. This can only improve the industry.

 

Carolinian

Actually, they purchased most of them AFTER they took over RCI, and then organizationally put them in the same group as RCI.  That background reveals a lot about where they are headed.

Exchange revenue went up because they raised the fees, but at some point that strategy produces negative returns.


quote:
Originally posted by Simoncc

You need to remember that Cendant has owned many of the rental only companies for years but recently rebranded them under the RCI Global Vacation Network. For the purposes of this argument, it would be useful to know each divisions results but I don't see how this information would be obtained.

The Wyndham press release stated that exchange revenue went up by 8% so I'm sure that they still see exchanging as a major earner for them. Of course, that is probably due to fee increases as much as more exchanges although a recent post on TUG stated that exchange numbers were still on the rise.

 

Simoncc

quote:
Originally posted by Carolinian

Actually, they purchased most of them AFTER they took over RCI, and then organizationally put them in the same group as RCI.  That background reveals a lot about where they are headed.



I'm not disputing that but I see Cendant as trying to establish a global operation tapping into all areas of the holiday market. Some of this will be timeshare and some will be rental.

Diageo is a global drinks brand with many well known labels but I don't see them putting Guinness into Baileys bottles - they know that the market wants more than just one tipple.

Whilst not thinking that Cendant are as pure as snow, I can understand a business strategy that does not rely on one segment of the market.
 

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