Hertz Makes Drastic Moves After EV Fiasco

Hertz, the car rental car company, is in the midst of significant upheaval. Having already announced plans to sell off a substantial portion of its electric vehicle (EV) fleet, troubles are continuing to escalate.

In a whirlwind of changes, the company is now on its fifth CEO in just four years. Stephen Scherr, who played a pivotal role in expanding the EV fleet, is stepping down, making way for Gil West, a seasoned executive from Delta Air Lines and General Motors’ Cruise unit.

Financial woes have plagued Hertz, with a staggering $245 million loss in earnings attributed to the depreciating value of its EVs. Despite a 40% surge in EV purchases by American consumers last year, Hertz found itself grappling with tepid demand, exacerbated by a price war initiated by industry leader Tesla.

“The execution and marketing of EV’s [by Hertz] was a horror show across the board. It’s a black eye they couldn’t recover from. They don’t want to go 20 minutes out of their way at five in the morning to find a charging station.”

Daniel Ives, analyst with Wedbush Securities, via CNN

Analysts suggest that Hertz’s missteps extend beyond its EV strategy. Poor execution and marketing have marred its efforts, dissuading potential customers. The absence of adequate charging infrastructure further hindered the appeal of renting EVs.

The company’s ambitious plans to purchase EVs from Tesla, General Motors, and Polestar fell short, reaching only 60,000 vehicles out of the proposed 175,000. Even without the EV debacle, Hertz struggled, facing steep repair costs and legal challenges, including a $168 million settlement over false theft reports.

This tumultuous period follows a string of leadership changes and financial setbacks. Previous CEOs, Mark Fields and Paul Stone, each faced their own trials, including bankruptcy filings and legal controversies.

Once a titan in the rental car industry, Hertz now trails behind competitors like Avis Budget. As the company navigates these turbulent waters, its future remains uncertain.