fter seven decades as Alaska’s oldest and largest family-owned car rental company, Avis Alaska has made a decision that speaks volumes about its commitment to the Last Frontier. The company is now 100 percent employee owned through an employee stock ownership plan (ESOP).

It’s a move Andrew Halcro, the former co-owner who quarterbacked the transition alongside his two older sisters, describes as the perfect solution to a complex puzzle. “We had to meet the expectations of three different generations,” he explains. “How do you get the first and second generations their maximum value and provide the runway for the third generation to get their maximum value? That’s the math problem you have to solve.”

Taking the generations out of the equation puts the company to work for a different set of stakeholders.

The path to employee ownership began in 2017 when Halcro and his sisters became the majority shareholders. They set a five-year timeline to grow the business before revisiting their succession plan. The company had a solid third generation ready to step up—grandchildren of Robert C. Halcro, who brought the franchise to Valdez in 1956—many of whom had grown up in the business and therefore had significant skills.

By 2022, an Alaska company approached the family with an acquisition offer. The family entertained the possibility, believing the Avis Alaska brand would maintain premier status in the buyer’s portfolio. But after several months of discussions, it became clear that no deal would materialize.

While the potential buyer was professional and cordial, the process took months, during which Avis employees had no certainty about their future. “It ended up being incredibly stressful for all involved on our side of the deal,” Halcro recalls.

That’s when a senior executive introduced the ESOP concept. The timing was perfect. Avis Alaska had been 15 percent employee owned since 2000, meaning much of the necessary infrastructure was already in place.

An ESOP is a qualified retirement plan set up as a trust fund into which the employer contributes stock or cash to buy existing shares. The ESOP can also borrow money to purchase shares, with the company making tax-deductible contributions to repay the loan. For Avis Alaska, this meant the 15 percent ESOP could essentially absorb the family’s 85 percent stake.

The evaluation process took a year and a half and involved carefully examining quarterly balance sheets, financial scenarios, and countless evaluations. In December 2024, the board approved the transition. From January through June of 2025, the team worked through financing, audits, and creating the governance documents necessary to transform from a closely held family business into an employee-owned enterprise.

“We really were run like a true small business,” Halcro says. “Becoming the directors of the company rather than the owners, there needed to be governance documents and things like that.”

The transition satisfied the board’s three guiding principles: keeping the family legacy alive, ensuring the company remained Alaskan-owned, and providing for the third generation’s future. Under ESOP rules, employees typically become vested after five years and receive benefits based on company performance, with their accumulated shares paid out over time when they leave.

Today, every Avis Alaska employee is an owner. A trustee oversees the company, monitoring its pulse without getting involved in the day-to-day operations unless something goes seriously off track. The trustee also holds veto power over board appointments.

This year is a milestone: Avis Alaska will nominate its first non-family board member in seventy years. “This is a big deal because our banks and accounts—no one outside the family has really seen them,” Halcro notes. “Getting outside eyes and experience is a great idea. Families can be used to doing business in the same way. This will increase the potential of the company.”

For employees, the ESOP represents a significant benefit beyond their regular wages. “You’ve had employees who made $20 an hour for twenty years and then walk away with a substantial chunk of money,” Halcro says. “The ESOP will really benefit every employee.”

In Alaska’s car rental market, Avis Alaska faces the same challenges confronting many locally owned businesses: massive consolidation under corporate umbrellas. “These major brands have accumulated other brands, so you’re really only competing against two or three brands,” Halcro explains. “They have significant advantages by scale.”

But Avis Alaska operates in ten cities across the state, albeit many of them seasonally, and in some locations it is the only provider because business can be spotty. It’s a commitment to the statewide network and to communities that larger corporations might not prioritize.

In addition to maintaining Alaskan ownership, the ESOP structure provides substantial tax advantages. For S corporations, the percentage of ownership held by the ESOP is not subject to federal income tax at the corporate level; rather, profits are taxed as individual earnings when they flow to vested shareholders.

These tax benefits will allow Avis Alaska to not just compete but to grow. In the spring, the board greenlit a $5.2 million building project at the Fairbanks International Airport, demonstrating the company’s newfound financial flexibility. “What’s so exciting about this deal is that we will have the resources to be confident that we can go in and compete against billion-dollar corporations,” Halcro says.

As Avis Alaska rolled out its 70th anniversary campaign, celebrating seven decades of service and the transition to employee ownership, the company’s foundational principle remained unchanged: “Try Harder.”

Halcro emphasizes, “Everyone who touches your car will have the incentive to ‘Try Harder.’”

The campaign for the 2026 anniversary happened in October at a statewide managers’ meeting, where company leaders brought employees up to date on the transition and what it means for their futures. The messaging was clear: Avis Alaska is seventy years strong, and the keys are now in the hands of the next generation of Alaskans.

The transition couldn’t have come at a more critical time for Alaska’s business landscape. As national chains increasingly dominate various sectors, the ESOP model offers a viable path for established businesses to remain locally controlled while accessing capital for growth and expansion.

Research shows that companies with employee ownership often see tangible benefits beyond the balance sheet. Employee-owned companies typically experience reduced turnover as workers become more engaged and connected to long-term goals. The sense of ownership can lead to improved job satisfaction, productivity, and loyalty—qualities that matter even more in Alaska’s tight labor market and seasonal business environment.

For Avis Alaska’s employees spread across ten Alaska cities, the transition represents more than a retirement benefit. It’s a stake in the company’s future success and a recognition of the value they’ve already contributed. In communities where Avis Alaska might be the only car rental option, employees now have a direct incentive to ensure the company thrives, serving their neighbors and visitors alike.

The family isn’t disappearing from the picture, though. Halcro and his two sisters remain a majority of the board, committed to preserving the company culture and ensuring future generations never forget the company’s history and its roots in Alaska communities.

“The great thing is we’re still preserving our roots by respecting the past,” Halcro reflects.

For family businesses considering their succession options, Halcro offers hard-won wisdom: Succession planning is always difficult, and many businesses don’t have a third generation ready to take the reins. Daily pressures can push long-term planning to the back burner.

“It’s not a question of the highest bidder,” he says. “It can be a question of getting that same value by selling to your employees. There are processes out there that really allow you to look at your company and create a clear landing pad for it rather than just worrying or putting it on the market.”

Looking back on the attempted sale that fell through, Halcro sees it as a blessing in disguise. “There were so many advantages to doing this that it’s hard for me to think of any other way of selling the business. The process, the checks and balances, the support we received—I can’t imagine ever going through something like that dance we did with the other company,” he says.

As Avis Alaska enters its next chapter, it does so with the keys firmly in Alaskan hands—roughly 300 pairs of them, in fact. For a company built on the promise to “Try Harder,” that’s not just a succession plan. It’s a validation of everything the family built over seven decades, now entrusted to the employees who will carry it forward for generations to come.