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Munich (Reuters) – Erich Sixt is leaving the operational business of Germany’s largest car rental company around the first loss in 50 years.
The 76-year-old pointed out on Tuesday that Sixt had generated a net profit of two million euros in the Corona year 2020 thanks to the sales proceeds for the subsidiary Sixt Leasing and a drastic austerity course. “That is also important for me,” said Erich Sixt, who had taken over the company from his father in 1969. “I wouldn’t have liked to go with a huge loss.” After the annual general meeting on June 16, the sons Alexander (41) and Konstantin Sixt (38) take over as heads of the board with equal rights. “They can do it and they give the company new momentum,” said Erich Sixt. “We are mutating into a mobility company.”
Shortly before his 77th birthday, Erich Sixt will take over the chairmanship of the supervisory board, replacing TUI boss Fritz Joussen. “You should resign the moment it’s best for the company,” he said. Son Alexander explained the future dual leadership: “We want to demonstrate that no hand fits between us. We also complement each other in terms of characters.” Both brothers have been on the board since 2015. Konstantin Sixt will continue to be responsible for sales, he for strategy, purchasing and personnel.
Sixt should remain in the hands of the family. “This company was my father’s life’s work and it is the life’s work of me and my brother,” said Alexander Sixt. Nothing should change in the proportion of shares within the family, which holds 58.3 percent of Sixt ordinary shares. Most recently, there was speculation that VW would be interested in joining Sixt.
In the new year things should look up again: “We see the dawn after a long night,” said Erich Sixt. He does not agree to a specific prognosis. “We don’t know what our federal government will come up with. A virologist comes along, paints a disaster scenario – and it happened.” In the best case scenario, the demand for rental cars could literally explode. “If you are locked up that long, you want to enjoy freedom,” said Sixt. Then cars could even become scarce and prices rise. The development on the US east coast, which is approaching normalcy, makes him confident. Sixt has great opportunities there because two of the three most important competitors are in financial distress.
In its core business, Sixt generated, as expected, a pre-tax loss of 81.5 million euros in the past year. In 2019 there was still a profit of 308 million. Sixt has saved 600 million euros: The rental car fleet was reduced by a quarter to 113,000, the number of employees fell by around 2000 to 6100. Alexander Sixt did not want to say how many more are on short-time work. Sales collapsed by 39 percent to 1.53 billion euros. The dividend – apart from the minimum dividend of five cents for the privileges – will probably fail again, indicated Erich Sixt.