Profile: Wayne Huizenga: Fast-forward to domination

Garbage, videos and cars - this billionaire knows what makes America tick, write Steve Matthews and Nick Gilbert

British tourists in Florida for the sun and the low prices know all about cheap car rental. On the high street back home they may also be familiar with the Blockbuster video chain. But they almost certainly know virtually nothing about Florida billionaire Wayne Huizenga, the key man behind both phenomena.

Huizenga made one of several business fortunes from building Blockbuster from a sleepy five-store business into an international empire before selling out to film and TV group Viacom Inc for over pounds 5bn in 1994.

The short, bald 59-year-old is also likely to be the man who rents the British tourist a holiday car. Huizenga is the chairman of Republic Industries, a vast US company which owns National Car Rental Systems and Alamo Rent- A-Car and is second only to Hertz in the car rental sector.

Last week Huizenga swooped in the UK, agreeing to pay pounds 95m for EuroDollar Holdings in what may be the start of an acquisition spree in Europe. In offering EuroDollar shareholders 190p a share, Huizenga was being generous: before the deal was announced the shares were at 118p, way below the 225p at which EuroDollar started trading in July 1994.

Huizenga's UK competitors are less thrilled. By adding EuroDollar's revenues of pounds 107m to Alamo's UK operation, Huizenga's car rental business leapfrogs Avis Europe to number one in the UK. "We consider him a formidable competitor," says Alun Cathcart, chairman of Avis Europe.

Remarkably, Huizenga has been in the car business for less than 12 months. In buying National and Alamo, the billionaire has opted to take Republic into a business where profit margins have been notoriously low. In the US, rental firms are lucky to make 5 per cent profit on revenues. "You can rent a car for $35 a day - about the same as it cost 10 years ago," says Geoff Corbett, head of Republic's European car rental business. "The joke in the US is that it costs more to rent a tuxedo for 24 hours than a car."

EuroDollar in the UK makes nearer 8 per cent on revenues, in itself one good reason for Huizenga's interest. The other, says Corbett, is the chance to "dramatically increase" the number of American tourists who will opt for a EuroDollar rental in the UK.

Number two in car rental in the US, number one in the UK in less than a year. Huizenga has always been a man in a hurry. As a young garbage collector in Florida he'd get up at 3am to drive trucks, then would shower before making a full day's worth of sales calls. In little more than a decade his company, Waste Management Inc, became the world's largest rubbish disposer. In the 1980s he repeated the trick, opening a Blockbuster store every day until it became the world's largest video rental empire.

"Some people dream of success, while other people get up every morning and make it happen," he has said. Now he's targeting car sales as well: in the past year Republic Industries has become the US's largest new car seller acquiring, on average, a dealership every two days. The 153 dealers should generate more than pounds 3bn in revenues this year.

Rounding out his holdings, Huizenga has built a chain of 14 AutoNation USA used car megastores. This gives him the opportunity to sell ex-rental cars through his own outlets: handy if car makers begin to offer less generous buy-back terms to rental fleet owners. "We want to meet your full transportation needs," says Huizenga. Renting, selling, financing and servicing cars provides "a cradle-to-grave approach".

His work habits haven't changed much since his garbage truck days, with work often starting before dawn and extending into the evening. He travels at night so he doesn't break into the working day. Recently his wife Marti insisted he take off one day a week, Saturday, when he often plays golf. "We operate under the philosophy that we are no smarter than our competitors," says Huizenga. "If you want to accomplish twice as much, you have to work twice as hard."

His fortune, estimated at over pounds 1bn by Forbes magazine, hasn't come only from hard work. His timing is remarkable, and he won't hang on to a business unless it makes money. He left Waste Management in its glory days and sold Blockbuster at its peak in 1994: shares in new owner Viacom have performed poorly since.

Huizenga knows when to cut his losses. Earlier this year he put up for sale his prized but unprofitable Florida Marlins baseball team, boasting that the team would have a good season even if he wouldn't stand for losses much longer. He continues to control the Miami Dolphins football and Florida Panthers ice-hockey teams.

None of his businesses has had the same potential as Republic Industries. Huizenga insists Republic is nowhere near saturating the market and projects a 50 per cent gain in revenues to over pounds 9bn next year. He joked to shareholders that he only wanted half the $1,000bn auto market. He won't set a target, but says even 2 per cent would create a huge company.

Huizenga has a vision of a transformed car industry in the US, one in which retailing costs have to be cut to counteract the impact of rocketing new car prices at the factory. Huizenga says too that customers hate the unpleasantness of haggling over price.

Yet Republic, Huizenga's most rapidly-built empire, is his most sprawling: it also includes waste collection and security services. "It looks an awful lot like the multi-industry conglomerates of the 1960s" which were broken up, said Morton Richter, president of Richter Asset Management, which sold 162,000 Republic shares held at year-end. "You get so big there's nothing left to buy. Your rate of earnings increase must slow."

Huizenga's challenge in the car sales business is far more daunting than the refuse and video industries. Selling cars is a much more volatile business. Investors have recognised this: after a two-year rise Republic shares have halved in value in the past six months. "If there's a big downturn, there's going to be a slaughter," says Sheldon Sandler, managing director in corporate finance for US securities firm Ladenburg, Thalmann & Co.

Meanwhile Huizenga has not been afraid to tangle with such major car makers as Toyota and Honda. Republic is in legal battles with both as his acquisition of dealerships clashes with the restrictions they try to impose on the number of dealerships owned by one company. The AutoNation used-car chain continues to spew red ink, losing over pounds 11m in the second quarter, though Huizenga says it will make money next year.

None of this seems to bother Huizenga. "Wayne has a self-deprecating wit. He is always making fun of something," says George Johnson, who sold his South Carolina waste company to Huizenga 20 years ago.

Yet the billionaire is hardly shy and retiring. Huizenga was mobbed by adoring shareholders at the May annual meeting in Fort Lauderdale, Florida. Dozens asked for autographs, and one insisted he kiss her baby. He took the stage to music from the Indiana Jones movies, and the show included clips from John Wayne films. The Duke rides again.

PROMOTED VIDEO
News
ebookA unique anthology of reporting and analysis of a crucial period of history
Sport
Luis Suarez looks towards the crowd during the 2-1 victory over England
sport
Life and Style
Cheesecake frozen yoghurt by Constance and Mathilde Lorenzi
food + drinkThink outside the cool box for this summer’s frozen treats
News
John Barrowman kisses his male “bride” at a mock Gretna Green during the Commonwealth Games opening ceremony
peopleBarrowman's opening ceremony message to Commonwealth countries where he would be sent to prison for being gay
Sport
Sir Bradley Wiggins removes his silver medal after the podium ceremony for the men’s 4,000m team pursuit in Glasgow yesterday
Commonwealth games Disappointment for Sir Bradley in team pursuit final as England are forced to settle for silver
Sport
Alistair Brownlee (right) celebrates with his gold medal after winning the men’s triathlon alongside brother Jonny (left), who got silver
England's Jodie Stimpson won the women’s triathlon in the morning
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Trade Desk Specialist (Linux, Windows, FIX, Finance, Networks)

£60000 per annum: Harrington Starr: Trade Desk Specialist (Linux, Windows, FIX...

Associate CXL Consultant

£40000 - £60000 per annum + BONUS + BENEFITS: Harrington Starr: CXL, Triple Po...

Project Manager - ETRM/CTRM

£70000 - £90000 per annum + Job Satisfaction: Harrington Starr: Project Manage...

C#.NET Developer

£300 - £350 per day: Harrington Starr: C#.NET Developer C#, WPF,BLL,MVVM, SOA...

Day In a Page

Backhanders, bribery and abuses of power have soared in China as economy surges

Bribery and abuses of power soar in China

The bribery is fuelled by the surge in China's economy but the rules of corruption are subtle and unspoken, finds Evan Osnos, as he learns the dark arts from a master
Commonwealth Games 2014: Highland terriers stole the show at the opening ceremony

Highland terriers steal the show at opening ceremony

Gillian Orr explores why a dog loved by film stars and presidents is finally having its day
German art world rocked as artists use renowned fat sculpture to distil schnapps

Brewing the fat from artwork angers widow of sculptor

Part of Joseph Beuys' 1982 sculpture 'Fettecke' used to distil schnapps
BBC's The Secret History of Our Streets reveals a fascinating window into Britain's past

BBC takes viewers back down memory lane

The Secret History of Our Streets, which returns with three films looking at Scottish streets, is the inverse of Benefits Street - delivering warmth instead of cynicism
Joe, film review: Nicolas Cage delivers an astonishing performance in low budget drama

Nicolas Cage shines in low-budget drama Joe

Cage plays an ex-con in David Gordon Green's independent drama, which has been adapted from a novel by Larry Brown
How to make your own gourmet ice lollies, granitas, slushy cocktails and frozen yoghurt

Make your own ice lollies and frozen yoghurt

Think outside the cool box for this summer's tempting frozen treats
Ford Fiesta is UK's most popular car of all-time, with sales topping 4.1 million since 1976

Fiesta is UK's most popular car of all-time

Sales have topped 4.1 million since 1976. To celebrate this milestone, four Independent writers recall their Fiestas with pride
10 best reed diffusers

Heaven scent: 10 best reed diffusers

Keep your rooms smelling summery and fresh with one of these subtle but distinctive home fragrances that’ll last you months
Commonwealth Games 2014: Female boxers set to compete for first time

Female boxers set to compete at Commonwealth Games for first time

There’s no favourites and with no headguards anything could happen
Five things we’ve learned so far about Manchester United under Louis van Gaal

Five things we’ve learned so far about United under Van Gaal

It’s impossible to avoid the impression that the Dutch manager is playing to the gallery a little
Screwing your way to the top? Good for Lana Del Rey for helping kill that myth

Screwing your way to the top?

Good for Lana Del Rey for helping kill that myth, says Grace Dent
Will the young Britons fighting in Syria be allowed to return home and resume their lives?

Will Britons fighting in Syria be able to resume their lives?

Tony Blair's Terrorism Act 2006 has made it an offence to take part in military action abroad with a "political, ideological, religious or racial motive"
Beyoncé poses as Rosie the Riveter, the wartime poster girl who became a feminist pin-up

Beyoncé poses as Rosie the Riveter

The wartime poster girl became the ultimate American symbol of female empowerment
The quest to find the perfect pair of earphones: Are custom, 3D printed earbuds the solution?

The quest to find the perfect pair of earphones

Earphones don't fit properly, offer mediocre audio quality and can even be painful. So the quest to design the perfect pair is music to Seth Stevenson's ears
US Army's shooting star: Lt-Col Steven Cole is the man Hollywood calls when it wants to borrow a tank or check a military uniform

Meet the US Army's shooting star

Lt-Col Steven Cole is the man Hollywood calls when it wants to borrow a tank or check a military uniform