An empire built on wheels

In many ways Antonio Hernández Herrero is a pioneer of the Spanish tourist industry. Through innovation and adaptation to changing times the fledgling car rental company he set up in 1974 has since become the country’s largest independent service provider of its kind in Spain.

You might say it’s a classic success story. Founded by a husband and wife team back in the early days of Spanish mass tourism, Solmar is a firm that has grown from very humble beginnings into a leading concern with almost 14,000 cars and a presence at airports and tourist centres throughout the country. “We began with a potpourri of second-hand cars,” smiles Don Antonio, “most of them borrowed from friends.”

It was with this eclectic mix of little Seats and Fasa-Renaults that he and his wife began to service the car rental needs of a growing tourist trade in the lovely coastal towns of Javea and Denia. “It was hard work but a period I look back on fondly. Bit by bit we expanded the business, eventually replacing our hotchpotch mix of old cars with new vehicles, and then widening the range of cars for clients to chose from.”

Although affected by the oil crisis they weathered the storm, building a name through hard work, reliability and good service. Visitors to the region would seek them out, sometimes becoming recurrent clients over a period of many years. “In the beginning people would arrive from the airport by coach and then largely stay put in the resort, so their need for rental cars was limited to daytrips and little excursions. They would come and rent a car by the day. Later, they started collecting cars at the beginning of their holiday and would return them before they left. All in all, it contributed to a steady growth in the sector.”

Adaptability as a formula for success

One of Don Antonio Hernández’ formulas for success has been flexibility – both in pioneering new ways of doing things and in adapting to changing conditions. “During the 1970s and 1980s the market gradually changed, as people became more dependent on having a car throughout their vacation and in fact expected to pick one up at the airport and drop it off there before they flew back home.” He responded to this by becoming one of the first car rental firms to facilitate this kind of collection and drop off system. As the company didn’t handle enough vehicles to maintain a permanent carpool at the airport, it involved no end of trips to and from the company’s base in Javea.

“The airport is in Alicante, so you can imagine the kilometres we clocked up. Add to this that the cars back then, especially the smaller ones used in car hire, were a lot more fragile than now and needed to be run in for the first 1,000km, and it seemed like we spent our whole lives driving.” Much of this was done by the couple themselves, who later competed in rally competitions, with Ford Fiestas, the Simca Rally and finally a Lancia Delta Integrale. “Gradually we devised a system of leaving keys for people to collect and drop off at the airport, and then set up our own booths at Alicante airport, the first of many to follow.”

In all, it cut back significantly on the ferrying of cars to and fro, and allowed the company to grow rapidly. Their example was followed by competitors, but by the early eighties Solmar had become an established and respected name in the industry. As its fleet grew and the company gradually established a presence at the main centres along the Costa Blanca and at airports across the country, the Solmar name became a countrywide rather than a local brand. By now, businesspeople and the many owners of holiday homes were added to conventional tourists, and the range of customers and cars began to expand.

New challenges

“In the beginning most of our fleet was made up of so-called C-class cars, like the old Renault 5 or the Seat 900, but these days it is more varied, including larger cars, people carriers and convertibles. We notice that German customers don’t like Korean-built cars because they don’t trust their safety, while Russians are very keen on sports cars and open top models. By 2008, bolstered by a large countrywide network and strategic alliances with airports and hotel groups, the company was operating 14,000 cars. “In the old days you would run such a car for 4-5 years, nowadays its lifespan as a hire car is just 6-12 months, so you can imagine the investment involved.”

For this, car hire firms are very heavily dependent upon a partnership with banks that provide financing facilities. The entire sector, Solmar included, was hit hard by the banking crisis that followed the financial crash at the end of 2008. “We had just had one of our best years, and like many other companies needed a significant part of our fleet replacing when the banks simply seemed to melt away. In all my years in business I hadn’t seen the likes of it. They went from high volume loans to withdrawing their service completely, leaving all of us high and dry. It really jeopardised an industry that was in itself healthy and thriving.”

As is his nature, Antonio Hernández overcame the challenge that faced his company, and threatened to destroy everything he had worked so hard and long for. By finding external sources of financing, he ensured the future of his company, albeit at the cost of personal equity in the firm. “At least we can operate quite normally again. Before long the banks will return again too, though we have started talking directly with the financing arms of the major car manufacturers like Peugeot and Fiat, so maybe we’ll change to a leasing system and no longer need to be quite as dependent on the banks in the future.”

For now, he is happy to do what he enjoys best – steadily leading his firm through choppy waters whilst enjoying life in a particularly pretty part of the world. The couple even participated in the 1,000km of Jarama, enticed by their son Sergio, a professional racing driver who was in GP2 with the likes of Hamilton and Alguersuari, and a daughter who herself competed in the Copa Hyundai. It seems a fitting passion for a family who have built a successful enterprise on the ubiquitous automobile.

www.solmar.es

New post on at Friday, 14 May, 2010, 9:05 am and is archived in Classic cars, Lifestyle, People. Subscribe to answers with RSS 2.0 feed. Both comments and pings are currently closed.