Hertz in midst of ‘critical transformation’

Car rental giant Hertz is in the “midst of a critical transformation”, with its top priority “getting back to the basics, operational excellence and unmatched customer service”.

Hertz CEO Gil West made the comments during an earnings call with investors last week when he added that the company’s strategy would be built around “our fleet, our revenue and cost management”.

West, who took over from former Hertz CEO Stephen Scherr earlier this year, added that to accomplish its strategic priorities, the company needed to strengthen its balance sheet and “ensure a more stable liquidity position”, as well as building a new team and organisational structure.

Hertz is in the process of accelerating its fleet rotation, which West said would enable the company to “lower our depreciation and maintenance cost, improve our customer experience and increase pricing power”.

The company announced in January that it was selling one-third of its fleet of electric vehicles – leading to questions about the strength of corporate demand for EVs. For more about this topic, read BTN Europe’s feature about the future of EVs: Is electric avenue just a dead end?

West stressed that EVs were “key for the future” and added that Hertz was looking to maximise revenue per day from these vehicles, while getting “the right product market fit to do that with our customers”.

Hertz reported second-quarter revenue of nearly $2.4 billion, which was down by about 3 per cent year-on-year. But the company slipped to a net loss of $865 million in Q2 compared with a net profit of $139 million during the same quarter of 2023.

The company had on average about 546,200 rentable vehicles globally during the quarter, up by 2.3 per cent from Q2 2023. Revenue per day was down 3 per cent year-on-year to $59.65.

International revenue, outside the Americas region, rose slightly year-on-year to $425 million, with the average number of rentable vehicles increasing by 5 per cent to 107,000. Revenue per day was down 2 per cent from a year prior to $58.38.