DeepSummary
The podcast discusses Hertz's failed plan to expand its electric vehicle (EV) rental fleet. In 2021, Hertz announced it would purchase 100,000 Teslas, sending its stock price up 40%. However, lower demand from drivers and expensive repairs led Hertz to sell many of those Teslas at low prices, resulting in a $245 million loss in its most recent quarter.
Analysts suggest that Hertz's EV problem was not due to lack of demand but rather poor management of its fleet. While people were open to driving EVs, they didn't necessarily want to rent them due to concerns about finding chargers before returning the cars. As a result, Hertz's CEO Stephen Scherr, who led the EV plan, is stepping down and being replaced by Gil West from GM's robotaxi unit.
While Hertz was an early mover in the EV rental space, competitors like Enterprise have taken a more cautious approach, focusing on understanding customer preferences for charging before fully committing to EVs. Despite its setbacks, Hertz hopes to eventually lead the way in sustainable EV rentals.
Key Episodes Takeaways
- Hertz made a major investment in electric vehicles by purchasing 100,000 Teslas in 2021.
- However, lower demand from drivers and expensive repairs led Hertz to sell many of the Teslas at low prices, resulting in a $245 million loss.
- Analysts suggest Hertz's EV struggles were due to poor fleet management rather than lack of demand.
- Hertz's CEO, who led the EV plan, is stepping down and being replaced by an executive from GM's robotaxi unit.
- While Hertz was an early mover in EV rentals, competitors like Enterprise have taken a more cautious approach.
- Despite setbacks, Hertz hopes to eventually lead the way in sustainable EV rentals.
- The episode highlights the challenges and risks involved in rapidly shifting to new technologies like electric vehicles.
- It also underscores the importance of understanding customer preferences and managing resources effectively when implementing major strategic changes.
Top Episodes Quotes
- “Hertz went all in on EVs partially because the company figured that a rising demand for purchasing EVs would translate to renting them. That wasn't necessarily the case.“ by David Brown (narrator)
- “Analysts say that Hertz's EV problem had less to do with demand and more to do with how the company handled its fleet, which was, as one analyst put it to CNN, a horror show.“ by David Brown (narrator)
- “Alas, Hertz has high hopes that soon its EV problems will be far behind it in the rear view mirror, you might say, and that when it comes to sustainable rentals of EVs, it'll still be the one leading the charge.“ by David Brown (narrator)
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Episode Information
Business Wars Daily
Wondery
3/25/24
Today is Monday, March 25, and we're looking at Hertz vs. Enterprise.
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