Hertz CEO out following electric car 'horror show'

[SouthBayDem]

Source: CNN

New York (CNN) — Trouble and turmoil continue at rental car company Hertz.

The company, which announced in January it was selling 20,000 of the electric vehicles in its fleet, or about a third of the EVs it owned, is now replacing the CEO who helped build up that fleet, giving it the company’s fifth boss in just four years.

The company announced that Stephen Scherr, who came to the company two years ago after nearly 30 years at Goldman Sachs, is stepping down at the end of this month. He’ll be replaced by Gil West, former chief operating officer of Delta Air Lines and General Motors’ Cruise unit.

In the most recent quarter, Hertz took a $245 million hit to its earnings due to a drop in value of the EVs it was selling.

Read more: https://www.cnn.com/2024/03/18/business/hertz-ceo-departure-ev/index.html

[PSPS]

1. Who thought having "nearly 30 years at Goldman Sachs" qualified the clown to run a car rental company?

That's like if Sears handed the reins to a guy with no background at all in mercantilism and, instead, installed someone whose background was solely in finance. Oh, wait. They did that. Now there is no more Sears.

At least, someone with a background of "chief operating officer of Delta Air Lines and General Motors’ Cruise unit" is closer to what I would think are necessary skills.

[Johnny2X2X]

9. This is rampant among these same recycled CEOs

Last edited Tue Mar 19, 2024, 01:44 PM - Edit history (1)

No knowledge of the business is the norm for new CEOs now.

My company hired a CEO from a different industry, but it's going OK so far. But more often than not, these Fortune 500 CEOs get recycled to pother businesses they have no experience with and it goes predictably terrible.

[pstokely]

33. they had ex cosmestics execs running Air America

nt

[jmowreader]

20. Or like hiring one of the top guys at GE to run The Home Depot?

Even though Bob Nardelli wasn't great, he instituted something that makes a LOT of sense.

In the Bernie and Arthur era of The Home Depot, the staff spent an hour stocking shelves then they sent everyone home and locked the doors. A massive percentage of what The Home Depot sells has to be moved with a forklift, and it's really hard to run one on the sales floor with customers around. Nardelli decided to hire night stocking crews and keep people in the building around the clock. They can operate pretty much unfettered because there aren't customers in the building at the time.

Then again...Nardelli also instituted a Six Sigma system at The Home Depot, which makes no fucking sense in a retail environment. Six Sigma works in a manufacturing environment - if you're making cars you can standardize the process used to do the work because every car needs an engine, it needs four tires, it needs doors, that sort of thing. And since the process of putting an engine in Car 1252 is the same as putting one in Car 2535, your process control steps will always work. At a retail establishment, you don't know whether a customer is coming in for ten Simpson H1 hurricane ties or four pallets of steer manure - and because the sales techniques for selling the first product are far different from the second...you might have to spend ten minutes explaining the differences between H1, H2 and H4 ties and evaluating the person's project to decide if that's the best one for them (yes, I was in the hurricane tie department), but the person wanting the other product may very well walk up to a cash register and tell the person, "please put four skids of manure on that trailer right over there." I mean, shit is shit - and since you only have one kind of shit to sell to someone you don't have to sell someone on the features and benefits of fifty pounds of shit in a fifty-pound bag.

[yonder]

22. I just now stumbled across this excellent post.

Excellent not only because of the points you made but also because of the descriptive way in which you explained them.

I know zilch about retail management, but learned a little just now.

[madville]

31. GM's Cruise unit lost 8.2 billion dollars

Before it was shut down a few months ago. That was their autonomous car product, giant money pit that failed.

[Tree Lady]

2. I can see why it didn't work

My son n law rented a Tesla for a trip they had and they spent most of the week stressed they would run out of battery power, trying to find a place to hook up, one place they drove way out of their way only to find out none of them worked.

I think if you own one, you know where to go, have it set up at your house and are used to it for traveling.

[mainer]

13. Ditto here, we were afraid to rent an EV

Too much range anxiety.

[tinrobot]

15. It's certainly a learning curve for most drivers

As someone who has owned EVs for over a decade, I would have no problem renting one. But then, I know how to find chargers that work and I have all the accounts needed to activate them.

For someone brand new to EVs, I could see it being a real hassle. It takes a bit to get used to the differences between gas and electric. They do require a bit of a learning curve, but once you get the hang of it, they're a great way to drive.

[Ace Rothstein]

19. The infrastructure doesn't currently exist to support people wanting to rent electric vehicles.

This may work a decade from now when charging facilities are more available. Who wants to be worried about recharging a battery on vacation?

[TexasBushwhacker]

23. Not to mention,, they wanted too much for daily rates

Unless you're driving all around the state, putting lots of miles on the vehicle, it just doesn't make sense to pay an extra $20 or $30 a day.

[Tree Lady]

25. My son n law rented because

they had a good sale on them. Probably people in state he was in weren't renting them.

[hatrack]

27. I rented one back in March from Hertz, mostly from curiosity . . .

Never been a Musk fan, but thought I'd give it a whirl. This was about a 1,000-mile round trip to a conference.

Anyway, I thought the car was OK - plenty of power when needed - but the leg room was limited and I hated Hated HATED the touchscreen control system. That said, the Tesla charging network was really impressive. Better than the car, I thought - fast and very easy to use, and typically about 40 minutes from +/- 20% to full charge.

But it's definitely a different experience. Long-haul trips are going to take more time. I'd say charging added about 2.5 hours to my time each way. You also really have to plan ahead. The lowest I got on charge was about 17% when I pulled into the next DCFC station, and that was a bit nerve-wracking.

Would I buy an electric? Yes, but not a Tesla. Would I rent a conventional model, hybrid or plug-in hybrid for a long-distance road trip instead of an EV? Probably yes.

[flvegan]

3. "Hertz will pay $168 million to customers it falsely accused of stealing its cars" probably doesn't help. Idiots.

In the car community, this had a lot of eyes on it. Hertz wasn't the only car rental company accused of having, well, idiots running the clown car show these companies can be. Put a lot of us car folks on notice. You'll NEVER get me back as a customer.

https://www.npr.org/2022/12/06/1140998674/hertz-false-accusation-stealing-cars-settlement

"As I have said since joining Hertz earlier this year, my intention is to lead a company that puts the customer first. In resolving these claims, we are holding ourselves to that objective," said CEO Stephen Scherr in a statement announcing the settlement.

Blow it out your ass, liar.

[Ray Bruns]

5. That's the reason Hertz took a hit.

[NBachers]

4. They're selling 2023 Chevy Bolts for the low 20's.

https://www.hertzcarsales.com/used-electric-vehicles.htm?geoZip=94102&geoRadius=0

[Emile]

6. They are all in Pleasanton, CA, wherever that is. It's

a long way from Indiana.

[Richard D]

7. Try Replacing the zip code

In the Url with your zip code.

[Emile]

8. Thanks, I will try that.

[ArkansasDemocrat1]

17. I was able to find some in OKC

21,000 for one with 9,000 miles

[Emile]

18. I too found some in Northern Illinois.

[jmowreader]

21. It's in the San Francisco Bay area

I don't think I'd want to drive an EV from there to Indiana, but considering that it's not far from San Francisco - where all the granola-eating, weed-smoking hippies who like EVs live - it's probably a good place to sell used EVs.

[Johnny2X2X]

10. Nice

This is what I am interested in for the secondary market for EVs for my next car purchase in a few years. I try to buy 2-3 year old cars with less than 25,000 miles on them. In 2026 I'll begin looking for an EV, so far the Kia EV6 GT is the leader in the clubhouse.

[tinrobot]

16. Used prices are dropping and once it's below $25K, there's a federal rebate.

I'm starting to see good used EVs dip below that number. If you find the right one, it's a great deal.

[Miguelito Loveless]

12. The Bolt is an excellent EV

with decent range as a daily driver for about 80% of drivers.

[Polybius]

14. Whoa, Tesla Model 3 for $28,275

[madville]

30. Not really a good deal

With the federal tax rebate people could get a new one for less than that.

[MichMan]

11. Wonder how many EV sat there unrented day after day

The number of people who would rent one just to try one out vs those who didn't want to deal with unfamiliar recharging procedures, charger locations, and range anxiety while on vacation or a business trip.

For a short term rental, fuel savings aren't a factor.

[republianmushroom]

24. Did he get a bonus of millions when shown the door ?

[MichMan]

26. The new CEO isnt going to buy any EV now

[Wonder Why]

28. You all got it wrong. The Teslas were a great idea.

Hertz thought they could rent them as premium cars but nobody wanted them. So they dropped the price to that of a compact but nobody wanted them. So they offered them at half (yes, half) the price of a compact.

We went to Tucson and got one for a total pice of $250 for a week. Can't beat the deal. But I was smart. I looked up the local EV club and asked them if someone who had one could answer questions and show me their car. Not only did a member show it, he let me take the wheel and practice in a big parking lot and offered to let me drive it back to his house.

Armed with this, I had no fears of renting the Tesla and had no troubles with it. In fact, every time we recharged, I'd talk to others recharging theirs to get other questions answered. Everyone loved talking about them.

I checked miles vs recharge costs and that came to hslf the cost I would have paid for gas.

Would I rent one again? Damn right at those prices but I but the new ceo has eliminated that by selling the cars. 😟

Would I buy one? Hell, no. Takes two to drive. One with the wheel watching the road. The other to find the menu to do anything. Even if you want to adjust the direction of airflow on your vent, you have to search for the menu then use your fingers on the screen to do it. Dumb as doornails.

It told me I want an electric but not a Tesla. Thanks, Mr. Scherr.

[Aussie105]

29. If I was in a strange city looking to rent a car

I have enough to deal with, so give me an internal combustion car please!

[madville]

32. EV resale value has plummeted

The secondary market for used EV’s is terrible right now. Part of it is manufactures slashing prices on new ones to move inventory, the other part are the federal and state rebates that make new ones cheaper than used in many scenarios. Hertz lost hundreds on millions just in depreciation of their Teslas, mostly because of all the price cuts on new ones and the tax credits.