Avis Budget Group Comments on Operating Environment and Expected Results for Second Quarter and Full Year 2008

PARSIPPANY, N.J., July 2 -- Avis Budget Group, Inc. today commented on events and trends impacting the vehicle services operating climate and the Company's financial performance.

"While our cost-saving efforts related to our Performance Excellence initiative are accelerating as planned, the second quarter has turned out to be a significantly more challenging operating environment than expected. As with our entire industry, we are confronting rising fuel costs, weaker-than-expected enplanements, lower commercial travel volumes and lower time and mileage rates per day," said Ronald L. Nelson, Chairman and Chief Executive Officer, Avis Budget Group. "As a result, our second quarter results will be below last year's."

"We believe that vehicle rental demand in the summer months may outpace supply, as we and others in the industry have trimmed peak fleet levels. This should result in favorable pricing comparisons and our advance reservations would support that view. But the recently announced capacity reductions by the airline industry are expected to contribute to a more difficult fourth quarter operating environment," said Mr. Nelson. "Given these dynamics, we expect that full-year earnings will be below our 2007 results. In particular, while it is difficult in the current environment to accurately forecast our future results, we currently estimate that our 2008 EBITDA will be approximately $350 million and our 2008 pretax income will be approximately $140 million, excluding any unusual items."

"We remain focused on operating the business in the most efficient manner, including optimizing fleet levels and implementing aggressive cost controls, while continuing to execute our long-term strategy. Our experience selling vehicles in the second quarter was favorable, and our Performance Excellence process improvement initiative continues to help us in our efforts to offset rising costs," said Mr. Nelson. "In addition, we continue to expect to generate significant free cash flow as a percentage of pretax income in 2008, and we will consider deploying cash to reduce indebtedness or to repurchase stock, as both alternatives appear remarkably attractive."

The Company anticipates releasing second quarter financial results after the market close on August 6, 2008, and will provide more details at that time.

About Avis Budget Group, Inc.

Avis Budget Group is a leading provider of vehicle rental services, with operations in more than 70 countries. Through its Avis and Budget brands, the Company is the largest general-use vehicle rental company in each of North America, Australia, New Zealand and certain other regions based on published airport statistics. Avis Budget Group is headquartered in Parsippany, N.J. and has more than 30,000 employees.