Good morning and welcome to the Avis Budget Third Quarter Conference Call. Today's conference is being recorded. At this time for opening remarks and introductions I would like to turn the conference over to Mr. David Crowther, Senior Vice President of Investor Relations. Please go ahead sir.

Thank you Ravi. Good morning everyone and thank you all for joining the first Avis Budget Group earnings call. On the call with me today are our Chairman and Chief Executive Officer, Ron Nelson; our President and Chief Operating Officer, Bob Salerno; and our Executive Vice President and Chief Financial officer, David Wyshner. Before we discuss our results for the quarter, I would like to remind everyone of four things. First a rebroadcast, reproduction and retransmission of this conference call and webcast without the express written consent of Avis Budget Group is strictly prohibited. Second if you did not receive a copy of our press release it is available on our website at www.avisbudgetgroup.com or on the FirstCall systems. Third, the company will be making statements about its future results and other forward-looking statements during this call. Statements about future results made during the call constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based on current expectations and the current economic environment. Forward-looking statements and projections are inherently subject to significant economic, competitive and other uncertainties and contingencies, which are beyond the control of management. The company cautions that these statements are not guarantees of future performance. Actual results may differ materially from those expressed or implied in the forward-looking statements. Important assumptions and other important factors that could cause actual results to differ materially from those in the forward-looking statements and projections are specified in the company's quarterly report dated June 30, 2006 on Form 10-Q, included under headings such as "Risk Factors" and in our earnings release issued last night and filed on Form 8-K. Finally, during the call the company will be using certain non-GAAP financial measures as defined under SEC rules. Where required, we have provided a reconciliation of those measures to the most directly comparable GAAP measures in the tables in the press release and on our website. Before I turn the call over to our CEO, let me briefly review the headlines of yesterday's press release. Our revenue from vehicle rental operations increased to a record $1.55 billion for the third quarter. EBITDA from our three operating segments was $141 million excluding separation-related costs, and we updated our full year 2006 financial projections that we announced in July and reiterated in August. Now I'd like to turn the call over to Avis Budget Group's Chairman and CEO, Ron Nelson.

Thanks David and good morning to everyone. May be a good place to begin is to quickly state the obvious. The separation of Cendant into four companies has been completed with Avis Budget Group, Realogy and Wyndham not trading as separate public companies and the sale of Travelport having closed in August. As a legacy Cendant entity, we formally adopted our new name Avis Budget Group and effectively we did a stock split which leaves us with just over 100 million shares outstanding. As expected, there was some heavy trading and stock price volatility in the first few weeks of August, however volumes and volatility appear to have now settled into a trading range. As a result of being a legacy entity however our GAAP financial results this quarter reflect various one-time expenses associated with the split-up and it makes it somewhat difficult to discern how our core car and truck rental operations performed. We will try to provide some clarity on that front. I should also note that we expect -- we do expect to file our Form 10-Q next Tuesday, largely because of the complexity of the tax calculations associated with the reclassification of former businesses as discontinued operations and the one-time items associated with the separation plan have caused our quarter-close process to take longer than is usual for us. Amid this corporate activity, we believe that Avis Budget maintained its position as the leading car rental company at the US airports and the largest general-use car rental company in North America. Our [sale on truck] revenues remained under 32%. In the local rental or off-airport segment, we opened 57 stores in the third quarter brining our year-to-date total to 131 and we remain on track to achieve our target of 200 main locations this year. In…

Thanks Ron. Beginning with the issue of fleet cost, three points. First fleet costs continue to escalate model year 2007, two we are confident this is an industry-wide issue, and three we are taking significant steps to mitigate the effects of rising fleet costs. For our model year 2006 fleet, our principal vehicle suppliers proposed year-over-year cost increases for program cars of over 20% as measured on a per vehicle basis. Through various measures we reduced the impact of that increase so that our overall cost per unit is averaging in the 10% area. For model year 2007, our vehicle suppliers again proposed increases of approximately 20% on program cars, and we have taken the following actions. First we are increasing the risk car portion of our model year 2007 fleet buys from 6% this year to approximately 22% next year. That's on an available car months basis, which is how we manage the fleet. This will result in a somewhat lower risk component in the calendar year because of averaging. Second we are modifying the mix of our fleet to reduce the number of specialty cars. Our purchases of SUV's and other premium vehicles are down 29% and 15% respectively and almost 50% of our risk buy has 4-cylinder engine. We've tried to be smart about our risk buy and managed the residual exposure by what we buy rather than what we have to sell. Thirdly, we are holding cars longer. We hope to extend the average life across our fleet to approximately 10 months or more than an average -- more than a month longer than 2006. This is the very real impact of reducing the need to purchase as many vehicles and we expect through all of these actions plus the modest increase in utilization our 2007…

Thanks, Bob. This morning, I would like to discuss our recent results, the steps we are taking to turnaround our truck rental business and our outlook. As Ron mentioned, there are a number of non-recurring items related to our recently completed separation that makes year-over-year P&L comparisons difficult. As a result, I will focus on the results of our vehicle rental business and it's free operating segment in which the separation related items are more easily understood. We have also provided year-over-year comparisons on a pro forma basis in Table 4 of our earnings release. In the first nine months of 2006, we've grown Avis Budget Car Rental revenue by 8% to $4.3 billion, generated pro forma EBITDA of $315 million and generated pro forma pre-tax income of $136 million. In the third quarter, we grew revenue 2%, while EBITDA excluding separation expenses was $141 million and pre-tax income excluding separation costs was $85 million. Our revenue growth was driven by 5% increase in car time and mileage revenue per day and a 1% decline in car rental days versus the prior year. Pro forma EBITDA declined 24% due to the double-digit fleet cost increases, Ron and Bob discussed, and due to weaker results in truck rental. Earnings to our domestic car rental operations, revenue increased 2% reflecting a 5% increase in T&M revenue per day offset by a 3% decline in rental days. The decline in rental days mirrors a 4% decline in domestic enplanements according to the preliminary airline data. Year-over-year drop in enplanements was particularly sharp in August. It was typically our busiest and most profitable month, and unfortunately, was impacted by a significant terrorism scare, disruptive changes and airport security rules. Interestingly if you break out, our 3% decline in third quarter rental days to its…

Thank you. (Operator Instructions). Let’s take our first question from Jeff Kessler with Lehman Brothers.

Thank you. First, with regards to the Truck Rental business, it’s a question that has probably been asked you before, but when you folks originally bought Budget, when Avis and Cendant essentially bought Budget, I guess I asked the question then, I will ask you again and I got the same answer back then is that why are you keeping the truck business? And the answer was, well its number two brand in the industry and that we have a lot of expectation from where that business is going, and I guess I have to ask you the same question because hopefully we'll get more than just the answer of why you are hanging out to a business that's been returning a lot less than the rest of your business is doing?

There's a few reasons, Jeff. I mean first of all over the last two or three years the truck rental business hasn't been returning a lot less than our other businesses, it's been doing well and it actually has been improving even when you take out the impact of the purchase price accounting on the legacy fleet. Secondly, I think that this is $500 million of revenue. It is in the vehicle rental business. It's under-performing and I think that we can improve this business and get the margins up north of where car rental are. Certainly when Cendant owned this, we did look to sell it over -- at various points and times and the truth of the matter was we couldn't get enough money to justify selling it. So I think on an economic basis it made sense and frankly given its poor performance this year would make even less sense to sell it. I think the other thing too that you've got to keep in mind is that brand control is important, and it doesn't make you comfortable and warm and fuzzy if somebody else is out there with 30,000 trucks with your brand on them. So I think for all those reasons we are committed to this business, we are committed to improving it and we think we can.

Okay. On the commercial pricing area where you folks are a little bit discontented with what you are getting, I kind of know what our business has given you and your major competitor in terms of pricing and I kind of know where the largest companies are pricing but there are three companies in this business, essentially the major commercial players and if you are talking about there being significant price competition after you get over a certain point in terms of price increases, is that implying that one of the players is underpricing the industry to keep you from being able to get more than 4 or 5% commercial pricing?

I don't think that's the motivation. You know, look -- yes the answer to your question is partially yes. I think one of the three players has been very aggressive on the pricing side, and I can only speculate on their motives. It may well be to the turnaround share declines that they have had over the last couple of years in preparation for an IPO. And I don't think that -- although we have been able to get some price increases I don't think that has abated to the extent that we would like it, but we do feel reasonably confident that -- look at the end of the day I think these are all rational smart people and they know if their fleet costs are going up and they are going to need to get pricing on a big chunk of their business in order to come to some equilibrium and build the margins and return on capital. So I think we are hopeful that it will turn around but for the first 10 months of the years it's been pretty competitive.

One of the longer-term projects of combining Budget and Avis has been to combine the physical plants, the actual lots and the people and the service areas at the airports. I realize that it rolls over, over a period of time because of lease restrictions and things like that from the airports. I am just wondering if you -- if I can get some idea of where you are in combining those -- combining the physical lots to basically gain cost and gain synergies from what you have gotten from your lets just say the front -- the front kiosk at the airport?

Hi Jeff how are you doing?

Hi Bob.

It's substantially done. There are as you said opportunities overtime that continue to come up as the airports change configuration -- logistical configuration and as those arise we are taking -- trying to take advantage of those. We are very still focused on keeping the customer-basing portions of our brand separate. We think that's healthier for our two brands. We like having the two brands but don't wish to combine them from a customer basing standpoint but as the logistical components of the airport change we are attempting to take advantage of combining things behind the curtain, so to speak to pick up further synergies.

Alright. Your major competitor on the on-airport side has obviously made a concerted effort to get into the off-airport business, the auto replacement business and they have -- they are exhibiting a specific strategy to do that which might be a little bit different than where enterprise has gone in terms of trying to hold down its share of the business. Could you talk a little bit about the strategy that you are using because Avis talked years and years and years ago about getting into off-airport and now I suspect that you are talking more about using the Budget brand to get into off airport?

Well I am not -- I won't claim to be an expert in what Hertz's strategy is in the off-airport market but I can tell you that our strategy has two or three tenets to it. One is where we had to build our geographic distribution of sites and as you know we'll add 200 this year, we will add 200 next year. I think we will cover somewhere between 80 and 85% of the population area is in the major urban areas with that distribution. By the way, I don’t think we will ever get to the 5,000 or so that Enterprise has, but I don’t think we need it for the insurance replacement business. So that --.

Where you are in number of sites?

We will be about 1,400 at the end of this year with 200. Two, I think the insurance replacement business and I think Enterprise's advantage over all of us is that they had an IT systems that integrated with the insurance companies and the rental car agencies to make billing and notification seamless. We actually have spent the last two years building that system. It went live two weeks ago. We are in the process of -- we've done demos for our existing customers. We are in the process of doing demos for our prospective customers and it is very well received. But until that system got developed, we were not going to get an enormous amount from insurance replacement business. This is not just an insurance replacement -- insurance company itself. At the end of the day, not only do you have to sell the insurance company, but you got to have feet on the street selling the local body shops and car rental -- car repair stores, and if you recall in our release, we've put a local sales force on the street. It's specifically going after insurance replacement at the local level with the body shops as well as going after commercial truck rental body shops. So we are getting twofer if you will. And third, I think is our force, we are doing reasonably well in this. We are going to double our revenue this year, we'll probably double our insurance replacement revenue next year and as I said it's a big market. I think there is plenty of room for all of us.

Okay. The final question and that is before the auto manufacturers bought up all the rental car companies back in early 90s and basically got into this old guaranteed buyback program thing, the companies that were involved in auto rental were effectively -- basically nearly 100% at risk at the time. There was a lot of discipline that was forced on these companies because of the need to monitor residual value versus the debt against those cars. Are you stating and did you imply at the beginning that by getting more heavily involved in at risk business, there would be more discipline that would be forced upon the industry overall and essentially maintaining fleet utilization as well as where you are just basically maintaining where your -- monitoring where your fleet would be?

Yeah I think that's correct, Jeff. I mean as we said in our release we're probably getting into it a little softer than some others. We do know how to manage a risk fleet as you stated. We used to do it and all the people that used to do it are still here. But I think we want to see how it shapes out this year and how it goes before we get into it much heavier than we are already. I do believe, however, that the amount of risk fleet that is out there will force all car rental companies to think about their utilization and how they dispose the units and be very judicious about that. I do believe that.

Okay. What you're saying is that the people who were doing your at risk business, they are still around at Avis.

That's correct, Jeff.

Because that is concern of some people that -- that you guys been on program cars for so long that you may have lost on these at risk experts?

That -- we are all still here, Jeff and as a matter of fact, we haven't totally been out of the risk business. While we have been heavily into the buy backs, we've still sold quite a few cars over the docketed at options and quite honestly this year we had pretty good success with it.

Alright, well thank you very much.

Thank you. Moving on, we will hear from Chris Gutek with Morgan Stanley.

Thanks good morning, couple of questions. Let's start to look -- dig a little deeper into the profitability of the domestic car rental business and first in terms of making sure we are talking apples-of-apples, if you take what you reported for EBITDA and add back the separation costs, but then allocate most of what you're calling the corporate interest expense to the US segment, we get an EBITDA margin of 3.5 to 4%, which is roughly half of what the other public companies recently reported and well less than half of what one of the other major competitors is looking at and even now that other major competitor is talking about significant further margin expansion. So, first would you agree with the definition? And secondly, could you help us understands issue by issue where those margin differences lie?

Sure I think the analysis and the allocation -- this is David. The analysis and the allocation of the debt that you have done does make sense at the -- same time, I think that the top line or that sort of analysis is challenging from one business to another. I think there are some differences between that you can see in our margins domestically and internationally, and we expect that’s an issue among other folks, so to the extent our mix is different from other folks. You will see some changes there. And the other key issues are the ones that Bob was talking about where we are on the short side of commercial versus leisure compared to the more leisure-oriented public company that’s out there. We do have a larger GM portion to our fleet, and that has been a negative place to be and we also have had a smaller risk component this year than a number of other folks and that has been a negative. So we do think that is creating some near-term pressures on our margins compared to other folks. But at the same time I do think some of the comparisons to -- that are out there are very challenging because of combinations of domestic and international businesses as well as adjustments and purchase accounting and other items that folks appear to have impacting our numbers.

David, could you elaborate may be a little bit more specifically on the cost structure, and we have heard some suggestion that under Cendant the business had gotten may be a little bit fat in terms of the corporate costs, in particular. It's kind of hard to imagine a lot of excess costs but could you talk about to the extent there might be some low-hanging fruit and then to what extent if there's not low-hanging fruit the management might have an appetite to take a much more aggressive look at the cost structure and consider some more radical actions to improve profitability?

Chris, we've heard a couple of rumblings along those lines and frankly we think they are completely unfair. I saw all of our other businesses at Cendant and the Avis management team, the team that's responsible for running the operations at Avis Budget now has for a long time been one of the most cost-conscious and cost-aggressive that we have seen, and I think is very effective in managing those costs. We are aggressive in looking at our operating cost by region and by site on a daily basis, that's going to continue. It probably will become even more aggressive but I think it is a part of the culture here that is continuing and, as Ron said, our opportunities are on pricing and expansion. Trying to cut our way into growth is not likely to be the solution for us given the historical ability and focus on doing that. I think there are always some opportunities but it is not a greenfield or untapped area for us; rather it's one that's thoroughly mined, but that's not going to stop us from going through it again.

Chris this is Ron. Let me just add three things that you shouldn't overlook in your analysis. I think with respect to two of our smaller competitors, they have a fair amount more franchise income than we do. And as you know that all drops to the bottom-line and adds -- my calculation a point or so to their rental margins. Second, as Bob pointed out, one of the expenses that is out of line with our revenue growth this year is M&D and M&D went up because we returned to taking debit cards and we changed our leisure mix in this past year and that reflected itself in the first half of this year with fairly substantial increases in M&D. We think we have gotten our arms around it now, we have got a much better system where we are doing credit checking on debit card renters and we are going to bring M&D back in line. And then thirdly and this is really not unique to us but it is -- it may impact us more than the rest of the industry is gas. We all make gas revenue because we charge, I don't know, $6 or $7 a gallon to refill it when somebody doesn't come in. When gas went up, the dollar a gallon over the course of this year we didn't really feel like we can move that pricing. So, what you had was where you were making some margin on gas that basically got eliminated in the first half of this year. It will start to come back as gas goes down in the back half and assuming gas did comfortable, we will have some margins going into next year. So, I think those are three things you need to look.

Okay. Thanks, and two more quick ones if I could. So, to dig a bit deeper on the price increase, the revenue per rental day was down sequentially Q3 versus Q2 and the year-over-year growth rate decelerated because of easier comps in Q2 versus Q3. But still could you help us better understand what's happening with pricing both on the leisure side as well as the corporate side and what is the underlying price increase for example this quarter versus last quarter and what are you seeing so far into Q4?

Will Chris, let me start off by saying what's going on in pricing. On the leisure side, we do see as we said good movement and pretty much across the industry and this is kind of a continuation of what's been going on since last year and it's been heartening and we've had good increases on the leisure side. On the commercial side, I don't want anybody to leave thinking there are no commercial pricing increases but certainly are and in a normal year, a year where fleet costs aren't going up to the extent that they are we would be actually quite pleased. The issue is that, it's just not enough in our opinion to overcome the fleet cost increase. So, we continue to push on that and I think that we will be more aggressive on our own in commercial pricing and then we also do believe that as the industry really has to report in and show numbers that -- it will allow further commercial price increase and we will move very aggressively when that happens.

Okay. Ron, final question for you, kind of, a big picture question; hypothetically, of course, given the current capital structure will it be feasible or possible for the company to pursue a leverage recap of potentially an LBO? And secondly, to what extent would you have an appetite to move in that direction?

Well -- I think in terms on a leverage recap I think that's myself take the gun and point at your head and shoot it quite honestly because so much of our cost structure is dictated by the ability to finance and acquire fully -- and credit rating is important in doing a leverage recap. It's going to hurt your competitiveness in terms of your ability to price and (inaudible). I actually think within -- if you are talking about substantial leverage recap that's a zero sum game. In terms of an LBO, look that's -- that's not within our control. We certainly are running this company for the long term. All the actions we're taking are ones which are going to benefit the company on a long term ongoing basis. But as we have said consistently when somebody makes an offer, the Board has a fiduciary obligation to consider it and -- certainly not are -- not the direction we are moving in.

Great thanks.

Thank you. We will now hear from Zafir Nazim with J.P. Morgan.

Thank you. A few questions, I guess that's an extension of the previous question that was asked. On the commercial side of the business, you mentioned that you got some increases, but not enough, but was your experience in getting commercial price increases during the third quarter similar to what you had in the second quarter or was it better or worse?

I would think that in the third quarter it was pretty much along the same lines. I mean, I think our frustration here is an issue that there is a need for further and greater price increases and a lag in the industry and the competitive nature of the industry in allowing that, but it hasn’t gotten any worse. I would not characterize that at all. And you might say there are -- late in the quarter and as we are moving along that you might see glimmers of hope, but it’s a little too early to tell.

Fairly evenly through the year or is there one quarter in which you have a spike?

No, I wouldn’t say that there's any big spike. I would say that our increases have been fairly even throughout the year as the renewals will build up.

Okay. In terms of deliveries of the 2007 model cars, when do these start hitting you? And in fourth quarter, what will be the mix between '07 model cars and '06 model cars.

Well we actually, we started taking in '07 model year cars in July of this year, and I don’t quite have in front of me the mix of what is going to be in the fourth quarter year. But we can still get that for you.

Okay. In terms of guidance for the rest of the year -- you know you're looking for an EBITDA of 85, which is a small increase of your last year's EBITDA and I am -- I guess I am kind of struggling with getting to that number given that your EBITDA in the first three quarters have been down roughly 25%, you have got higher fleet costs to content with because now you have the '07 price increases in addition to [safe that have still not impact] through, so how can you give us more comfort and say whether you can hit an EBITDA number which is actually slightly higher than what you did in the fourth quarter of last year?

This is David. I think an important part of the issue is anniversarying the fleet cost increases last year. The price increases that we have seen in the third quarter were fairly significant in the 5% range and the big part of the issue is that we had not yet anniversaried the significant roll end of model year 2006 vehicles. And as a result I think the fourth quarter dynamic on a comparable basis, that changes a bit and that's why we are comfortable with the projections we have for Q4.

Okay. And finally on the truck -- on the truck rental side, any estimate as to when this business is like to stabilize in terms of the top line as wells as margins?

I think, we've just started our restructuring plan, I think that -- we are thinking about over the course of next year we'll see continued improvement and by the time we turn into '08 we are hoping that we can have a normalize business.

I wouldn't under estimate one of the points that David made of outlook looking at our dealer network and moving strategically to open our own locations. One other thing that U-Haul does very well that we don't do particularly well is cell boxes and related ancillary goods. Those are very high margin items. It's very difficult to sell and get the margin from them when you are dealing exclusively with an independent dealer network. And so the move to open up corporate locations where we can control that process and get better volume on those high margin items, I think is very significant in getting the margins back to where they belong. And that is not a quick process. As you know, opening locations and establishing can take anywhere from 12 to 18 months. But this is something that we are starting in earnest and we are going to move as quickly as we can because the bottom line is it can't return fast enough to normal margins.

And how many locations do you think you will have -- corporate locations by the end of next year?

I don't want to speculate on it. We just hired a new guy to run it and this has been his marching orders, and we are going see his plan over the course of the next few weeks. We need to give him some time to get his feeling. So we can update you as time goes on that.

Okay thank you.

Thank you. We now move on to Michael Millman with Soleil Securities.

Thank you. Also a couple of questions. Can you talk about the possibility of off-airport sites and how it differs in the US and international?

Michael I think in the US when we look at our off-airport sites, different cost structures in the airport but all in all then -- and different pricings in the airport, so all and all the actual profitability is quite similar to the airport is what we see. Internationally, there's really -- it's a smaller component of our business internationally except in Canada where we have a pretty large off-airport infrastructure, but again there, it is -- it actually is quite similar to the Canadian airports and the Canadian operations.

I was asking that because Hertz seems to be suggesting that there is a long period before it's profitable, and that they have built very carefully at their sites and weed out a lot of them, do you see that as well? Does it take a long time to get these up to profit?

It takes for us somewhere between 6 and 9 months to get it to the normalized profit we think its going to operate at. The real key we find is that you have to spend time in where you're going to put it and we do a lot of demographic research before we open a store. It's reflected in the amount of closures we have which are really almost nil. So, I mean we -- if you put it in there right the first time and give it a little time and effort, we generally find within 6 or 9 months where we need to be.

Given that it had similar profitability, and it has faster growth, are the earnings there growing faster then on the airport?

I think that's a fair way of looking at things. It's still a -- you know, it's still a relatively small portion of the business there. So it's hard to draw a lot of conclusions from that.

Because you seem to be focusing -- a lot of focus is on the profitability of that business going forward, so trying to get some idea of where it goes. And also I think you said that the same-store sales growth was 9%. Was that correct?

Yes.

And it's part of that basically tenuring benefit?

There would be some in there to the extent that there is some continued growth for a second year site compared to a first year site. But as Bob was mentioning the new locations do come up to speed relatively quickly, but there is some layering or tenuring effect in there as well and that should continue with us having opened about 200 sites this year.

Just to beat a dead horse. We should assume that about 20% of car rental profits comes off-airport?

I don't think we are going to get into profitability breakdowns between the on-airport and off-airport. Our disclosures are going to be based on the domestic business as a whole.

Moving to the risk cars, can you talk about what risk cars -- how they affect your debt expense?

Sure the cap cost for risk cars tend to be a little bit less than they are for the program cars, and so there will be a little bit of a reduction associated with the debt expense with the -- in average risk car compared to a typical program car. In the scheme of things I think that effect will be relatively small but it is a positive that were factoring into our 2007 thinking.

Is there a negative that you might have to put up more equity?

No, there is really not Mike. The issue in terms of how the rating agencies are looking at our program vehicles is that the amount of enhancements we are required to put up on program vehicles is very similar, is not identical now between GM and Ford program cars and risk vehicles. So, one of the reasons that risk vehicles have become relatively more attractive over the last 12 to 18 months that there is no longer a credit enhancement difference between Ford and GM program vehicles and repurchased vehicles and risk vehicles.

And can you give some idea of how -- what had contracted the saving between the two?

The principal savings relates to depreciation costs, the slightly lower cap costs and then were we can dispose of the cars in the market and I think the opportunity that we've had this year and that we see ourselves having next year as well with the relatively small risk percentages in our fleet are that we can decide which models and which markets and which times of the year were disposing of risk vehicles and that gives us an opportunity to reduce the aggregate costs, the aggregate depreciation costs associated with the risk vehicles.

Can you quantify that?

I think we're reluctant to do that but suffice it to say we do think that risk vehicles are going to -- they certainly have been less expensive this year and we expect that they will be again next year, but we don’t want to go into details about that.

And your third quarter 5% price increase, could you give some idea of how mix affected that?

I'll have to follow-up with you on that.

Thanks. And regarding -- you had mentioned I guess to Chris' question about some of those additional costs, can you quantify those impacts? And where do -- and how you --?

Well, I don’t think we are going to get into any line item detail on our income statement, Mike. I mean we are trying to give some guidance for things that explain the difference between our third quarter margin and others' third quarter margins, but I think we are not going to get into line item detail.

And talking about following up on what you said, Ron, Hertz seem to be particularly optimistic about '07, are they drinking out of a different fountain than you are?

No. look I hope everything that they say on their road show comes true because by and large we have the same mix of business. We are both premium players and if the market is good then we'll both benefit similarly. What it -- it does appear that they have more risk fleet than we do. So if the used car market holds up, then we will enjoy a slight advantage on that, but I think we are just cautious about going forward in '07 and we may I hope everything they say is correct.

Great. Thank you.

And we will take our final question from Emily Shanks with Lehman Brothers.

Thank you. And just a quick question around the vehicle debt, is there a reason or could you give a little bit of color as to why it's down sequentially quarter-over-quarter?

Sure Emily. It principally relates to seasonality. I think there is no significant change in how we are financing the fleet. The issue is that at the end of June we are pretty close to our -- we are much closer to our seasonal peak to support July and August and summer leisure volumes and over the course of September, we reduce our fleet fairly significantly and that causes the debt to decline typically from June to September.

Okay. Great. That's helpful. And then just one quick follow-up as most of my questions have been answered, will you be providing the supplemental data for Avis Budget LLC as you did for the second quarter with more balance sheet etcetera?

Yes. That’s a great question. We do expect to post the Avis Budget Car Rental LLC financials next week.

Next week, okay. Thank you.

And that’s all the time we have for questions, I'll turn it back over to our speakers for any additional or closing comments.

No I think that’s it. I thank you all for joining our first call and we look forward to talking to you at the end of the year. Thank you

Thank you. That does conclude today's conference call. We thank you for your participation. Have a great day.