The Hertz Corporation

For other uses, see Hertz (disambiguation).
Hertz Corporation
Public
Traded as NYSE: HTZ
Industry Rental and leasing
Founded 1918
Founder John D. Hertz
Headquarters Estero, Florida, U.S.
Area served
 Worldwide
Key people
 CEO, John P Tague [1]
Owner Hertz Global Holdings
Number of employees
 29,350[2]
Divisions Hertz Equipment Rental
Hertz Car Sales
Hertz on Demand
Subsidiaries Donlen Corporation
Website www.hertz.com
Hertz office Livonia, Michigan

The Hertz Corporation, a subsidiary of Hertz Global Holdings Inc[3] is an American car rental company with international locations in 150 countries worldwide.[3] Hertz is the largest U.S. car rental company by sales.[4] On May 7, 2013, it was announced that Hertz would relocate its corporate headquarters to Estero, just outside Fort Myers in Southwest Florida.[5][6]

History

Early years

The company was founded by Walter L. Jacobs in 1918, who started a car rental operation in Chicago with a dozen Model T Ford cars. In 1923, Jacobs sold it to John D. Hertz who made it a subsidiary of his Yellow Truck and Coach Manufacturing Company and renamed it "Hertz Drive-Ur-Self System".

He sold a controlling interest in the Yellow Truck and Coach Manufacturing Company (and hence also 'Hertz Drive-Ur-Self') to General Motors in 1925 who then purchased the remaining shares in 1943.

Hertz arranged for The Omnibus Corporation, which he also owned, to purchase the car rental business back from GM in 1953. He sold all The Omnibus Corporation's public transport interests the same year, changed its name to 'The Hertz Corporation' and floated it on the New York Stock Exchange the following year.

The Hertz Corporation

In 1954, the new corporation bought New York truck leasing company, Metropolitan Distributors.[7]

In 1967, The Hertz Corporation became a wholly owned subsidiary of RCA but was operated as a separate entity. In 1985, Hertz joined and was acquired by UAL Corporation. On December 30, 1987, Hertz was sold to 'Park Ridge Corporation', which was then owned by Ford Motor Company and members of Hertz senior management. In 1988, Volvo North America Corporation invested in Park Ridge Corporation.[7]

On June 13, 2005, Ford issued a notice that Hertz would be let loose in an initial public offering. On September 8, 2005 it was announced it was to be sold to private equity companies Clayton, Dubilier & Rice, The Carlyle Group, and Merrill Lynch Global Private Equity for $15 billion in cash and debt acquisition.[8] The sale was completed on December 22, 2005. This private equity group took Hertz public on November 16, 2006.

On January 11, 2010, Hertz announced the acquisition of used cars dealer British Car Auctions (BCA) for an undisclosed sum.[9]

In November 2011, Hertz introduced ExpressRent kiosks at a number of locations. This was the first large scale car rental kiosk deployment in the U.S. using a live agent assistant via video chat.[10]

On January 3, 2014 it was reported that Hertz shares had jumped in value by 2.6% after the reported purchase of 30-40 million shares by billionaire Carl Icahn in what was believed to be a hostile takeover attempt. In response to Icahn’s reported share purchase the Hertz Board reportedly stated that it would issue one preferred share for each current share in what is referred to as a “poison pill” response.[11]

Key Executives

Hertz Global Holdings Inc

In April 2010, Hertz and Dollar-Thrifty Automotive Group announced an agreement under which Hertz was to acquire Dollar-Thrifty for a purchase price of US$41 per share, subject to shareholder approval, in a mix of cash and Hertz common stock.[19] Dollar-Thrifty investors in Tulsa, Oklahoma rejected this US$1,440,000,000 bid from Hertz on September 30, 2010.[20] Dollar-Thrifty subsequently announced on October 12, 2011 that it had taken itself off the market because it did not receive any proposals that would pass antitrust review.[21] On August 28, 2012, Hertz announced for the second time its intention to acquire Dollar-Thrifty, subject to FTC approval, in this case for US$2,300,000,000.[22] This merger would yield combined annual sales of US$10,200,000,000.[4] The deal was concluded in November 2012 and resulted in a combined 10,400 locations in approximately 150 countries.

Headquarters relocation

On May 7, 2013, Hertz executives, alongside Florida Governor Rick Scott, announced the company would be relocating its worldwide headquarters from Park Ridge, New Jersey to Estero, Florida. It will be located on the southeast corner of the intersection of Williams Road and U.S. Highway 41 (South Tamiami Trail), though some operations will still occur in its old headquarters in Park Ridge.

Locations

Hertz office on the island of Martha's Vineyard

Hertz operates in 145 countries. Outside the US, Hertz has company-operated locations in 18 countries, the rest being franchises. As of December 2012, the Company had approximately 3,210 staffed rental locations in the United States and around 1,215 staffed rental locations internationally.[23]

Overland West is the largest Hertz licensee in North America, operating 22 car rental and 5 car sales locations in 7 states.[24] Wilford Gwilliam purchased the Hertz franchise in 1941. He later sold it to Devere J. Sparrow who led the organization until 1976 when he sold it to his son-in-law, Jerry H. Petersen. Jerry grew the business from just a few rental locations and one sales location to what it is today, and still serves as the owner, president and CEO.

Fleet

The Hertz fleet consists of a wide majority of vehicle manufacturers, with the majority being GM products. Luxury cars are provided by Mercedes, Infiniti, and Cadillac. Previously, due to Hertz's affiliation with Ford, the rental fleet of most locations consisted of Ford and its brands, such as Mazda, Volvo, Mercury and Lincoln, along with various others (mostly Korean and Japanese). As of December 2012, the company has over 490,000 cars in the US and a rental fleet in its international operations of over 177,000 cars, exclusive of its licensees' fleet.

Specialty Cars

In 1966, Hertz engaged racing and automotive designer Carroll Shelby to develop an exclusive version of his modified Ford Mustang. One thousand GT350H Mustangs were built and ultimately sold once their rental use had ended; however, many of them were missing the matching engine. Some customers would rent the car for a weekend and swap out the high-performance engine with a base version 289 cu in (4.7 L) V8. Engine inspections upon return of the rental unit were not common place, so nobody found out until the car was due for service. By that time, there was no way to track down the engine thief. The so-called "rent-a-racer" program in the late-1960s was available in selected locations and the fleet also included Corvettes, Jaguar XK-Es, and AMC AMXs.[25][26]

In 2006, the 40th anniversary of the original GT350H, Hertz introduced the Shelby Mustang GT-H as part of the Fun Collection at select locations. This was followed in 2007 with a convertible version of the GT-H. 2008 saw 500 Chevrolet Corvettes, badged as "ZHZ", available from selected US airports; the following year 350 convertible ZHZs joined the fleet. Both were finished in Hertz' corporate yellow with a central black stripe.

In 2013, Hertz paired with Penske and Ford to manufacture specially-modified black-and-yellow 2013 Ford Mustang GT Premium Coupes that were individually numbered for their fleets at select U.S. airports.

All of Hertz's US specialty cars featured SIRIUS satellite radio, Hertz's NeverLost navigation system, and other features that may not be equipped, or at least may cost extra, on their standard-class vehicles.

Green collection and electric cars

Hertz launched its "Green Collection" in September 2006 with environmentally friendly vehicles including the Toyota Prius, Ford Fusion, Buick LaCrosse, Toyota Camry, and Hyundai Sonata.[27] All feature Environmental Protection Agency (EPA) highway fuel efficiency ratings of 28 mpg-US (8.4 L/100 km; 34 mpg-imp) or better on the highway.[28] In early 2007, Hertz launched its global hybrid rental program in conjunction with a $1 million donation to the National Park Foundation.[29]

Hertz has an agreement with Nissan to bring the Nissan Leaf electric car to certain U.S. and European locations. Hertz said it also will supply electrics and plug-in hybrids from other manufacturers, including General Motors, Toyota, and Mitsubishi.[30]

Hertz 24/7 car sharing

Hertz 24/7, formerly Hertz on Demand and earlier Connect by Hertz,[31] is the Hertz Corporation’s global car sharing service, launched in December 2008, and currently operates in outside of the United States in select cities in Europe and in Sydney, Australia.[32][33][34] Hertz 24/7 shut down its United States operations, including university campuses, in 2015, and had previously shut operations in select cities in years prior to the full shutdown.[35] On university campuses, Hertz 24/7 offered vehicles in the Personal, Social, and Jet Set Collections.[36]

As part of Hertz Global EV initiative, Hertz 24/7 offers for hour rental several electric cars at selected locations in the US, the UK, and China. The plug-in electric vehicles that will be available include the Nissan LEAF, Chevrolet Volt, Mitsubishi i-MiEV, Tesla Roadster, Smart ED, Toyota Prius Plug-in Hybrid and Coda Sedan . As of May 2011 the Smart ED, the Chevy Volt, and the Nissan Leaf are available in New York City.[37] Later in 2011 plug-in cars will be introduced in San Francisco and Washington D.C.[38][39] In April 2011 the Mitsubishi i MiEVs began to be offered in London for rental to Hertz 24/7 members.[40]

Simply Wheelz and Advantage

For pre-merger history, see Advantage Rent a Car.

In 2007, Hertz launched subbrand "Simply Wheelz" to address economy-minded and leisure-market customers in Orlando, Florida. The subbrand was colocated within and utilized the fleet and other assets of the parent brand, and channeled reservations and customer-service through a streamlined web front-end (resembling those of low-cost-carrier airlines) to its existing systems. Hertz outbid Enterprise Rent-a-Car acquiring the assets of bankrupt Advantage Rent a Car System in early 2009. The Simply Wheelz subbrand and website were then rebranded as Advantage Rent-a-Car.

On August 26, 2012, Hertz announced that it agreed to sell the US Advantage business to Franchise Services of North America and Macquarie Capital, as a divestiture to receive regulatory approval of Hertz's acquisition of Dollar Thrifty Automotive Group, announced at the same time, and to convert foreign Advantage locations to the Thrifty brand.[41] On December 12, 2012, Advantage Rent A Car was acquired by MacQuarie Capital.

Advertising

Let Hertz put you in the driver’s seat

In 1959, the advertising firm of Norman, Craig & Kummel (NCK) was selected as the new advertising agency for Hertz. NCK developed the slogan “Hertz puts you in the driver’s seat,” which was first used commercially in September 1959. NCK quickly changed the wording to “Let Hertz put you in the driver’s seat” by October 1959. Popular a cappella quartet The Hi-Lo's sang the Hertz song for the commercials. Hertz used the line in the early 1960s in print, signs and television. The series is listed as number 65 in the top 100 advertising campaigns of the 20th century by Advertising Age magazine.[42]

John F. Kennedy assassination

Hertz billboard on the Texas School Book Depository roof in 1969.

A large billboard advertising Hertz was on the roof of the Texas School Book Depository in Dealey Plaza during the assassination of President John F. Kennedy on November 22, 1963. The billboard was removed in 1978.[43]

O.J. Simpson

O.J. Simpson appeared prominently in ads for the company. The company set the trend of hiring black athletes as sponsors of various brands.[44] In 1975, O.J. Simpson became a staple in American households with his Hertz commercials.[44] One spot from the mid-1970s, showed Simpson, former football star as he was, running through an airport terminal (wearing a three-piece business suit and carrying a briefcase) and leaping over rows of departure lounge seats trying to get to his Hertz rental car. A woman yelled, "Go O.J. Go!" The tagline of the ad, as spoken by O.J., was "Hertz, the superstar in rent-a-car". In later years and through the 1980s, he appeared with golf legend Arnold Palmer; the pair was joined by the early 1990s by actress Jamie Lee Curtis. The relationship between Hertz and Simpson ended in 1994, following Simpson's arrest for the murder of Nicole Brown Simpson and Ron Goldman.

Low-floor passenger bus

A low floor Hertz bus at O'Hare International Airport in Chicago

A significant Hertz-led technology was the development in North America of the low-floor passenger coach. Until the early 21st century, most large Hertz lots were linked to airports they served by small fleets of firm-operated transit buses. Many Hertz locations used the Rapid Transit Series, whose high floor and stairs made loading of baggage difficult and rendered access to wheelchair and ECV-using customers difficult or impossible. A large potential contract from Hertz led Gillig Brothers of Hayward, California, to invest in a radical redesign of the city bus that offered a floor only a foot off of the ground (lower when pneumatically "kneeled") from the front of the bus, between the front wheels, up to the rear axle. The low floor and additional space freed by the redesign, initially titled the "H2000LF" by Hertz, greatly reduced loading and unloading time, increased convenience, and were for a time exclusive to Hertz. The bus was subsequently marketed as the Gillig Low Floor and is widely deployed by U.S. public transportation agencies.

Heavy equipment rental

Hertz also maintained a heavy equipment rental division known as the Hertz Equipment Rental Corporation, aka HERC until July 1st, 2016. HERC started operating in 1965 with its first location in Houston, TX. It was headquartered in Park Ridge, New Jersey, United States. In 2014 Hertz announced that they would separate their equipment rental division through a tax free spin off. The split was completed on June 30th, 2016 and on July 1st, 2016 Hertz Equipment Rental Corporation became an independently publicly traded company called Herc Rentals Inc. [45] HERC has more than 200 branches throughout the United States, Canada, the European Union, and China.

References

  1. ↑ "Hertz InvestorRoom - Executive Officers - John P. Tague". Ir.hertz.com. Retrieved 28 December 2015.
  2. ↑ "Hertz says over 4,000 jobs to go". BBC News. 2009-01-16. Retrieved 2010-12-12.
  3. 1 2 "Hertz Global Holdings, Inc. Company Profile". Yahoo! Finance. Retrieved 2012-01-27.
  4. 1 2 Terlep, Sharon; Kendall, Brent (November 15, 2012). "Hertz to Get Approval of Dollar-Thrifty Deal". The Wall Street Journal. p. B9.
  5. ↑ "Hertz to bolster local construction, real-estate industries". WINK News. May 7, 2013.
  6. ↑ "Hertz moving HQ from New Jersey to Florida". The Fort Myers News-Press. 2013-05-07. Retrieved 2013-05-07.
  7. 1 2 "Hertz History". Hertz Corporation. Retrieved 2012-01-27.
  8. ↑ Andrew Ross Sorkin (September 9, 2005). "Private Investors to Buy Hertz for $15 Billion". New York Times. Retrieved December 19, 2013.
  9. ↑ "Hertz acquires used car dealer BCA". 2010-01-11. Retrieved 2010-02-18.
  10. ↑ Stacy Collett. "Hertz Improves Customer Experience With Friendlier Kiosks". CIO. Retrieved 2014-03-24.
  11. ↑ "Carl Icahn Is Loading Up On Hertz, And Shares Are Popping". Business Insider. January 3, 2014.
  12. ↑ Hertz Names Former United Airlines Executive CEO "Wall Street Journal" November 20, 2014
  13. ↑ "Auto Rental News" December 3, 2013
  14. ↑ "Wall Street Journal" January 6, 2015
  15. ↑ "Auto Rental News" January 7, 2015
  16. ↑ Hertz Names EVP of North American Rental Operations "Auto Rental News" August 26, 2015
  17. ↑ Eliana Zem "Bloomberg"
  18. ↑ Michael Taride "Forbes" April 29, 2013
  19. ↑ "Hertz Signs Definitive Agreement to Acquire Dollar Thrifty" (Press release). Dollar Thrifty Automotive Group. 2010-04-26. Retrieved 2010-08-09.
  20. ↑ Bliss, Jeff; Clothier, Mark (2010-11-15). "Avis May Have to Sell Assets to Get Thrifty Proposal". Bloomberg. Retrieved 2012-11-23.
  21. ↑ "Dollar Thrifty takes itself off the market". Bloomberg Businessweek. Associated Press. 2011-10-11.
  22. ↑ Moss, Linda. "Hertz buys Dollar Thrifty". NorthJersey.com.
  23. ↑ "Hertz Global Holdings Inc (HTZ)". Reuters. Retrieved 13 August 2014.
  24. ↑ http://www.overlandwest.com/about_us.html
  25. ↑ Nolan, Bruce. "1968 AMC AMX - Hertz Rent A Racer". Retrieved 28 December 2015.
  26. ↑ "Rent-a-Racer: Hertz and the Muscle Car Era". FossilCars. 17 March 2015. Retrieved 28 December 2015.
  27. ↑ Grant, John (2009). The Green Marketing Manifesto. Wiley. ISBN 978-0-470-68731-4. Retrieved 2012-01-27.
  28. ↑ Hopf, Leo; Welter, William (2010). Rethink, Reinvent, Reposition: 12 Strategies to Renew Your Business and Boost Your Bottom Line. Adams Media. p. 19. ISBN 978-1-60550-024-9. Retrieved 2012-01-27.
  29. ↑ Nazzaro, Robin (2009). National Park Service: Donations and Related Partnerships Benefit, but Management Refinements Could Better Target Risks and Enhance Accountability. United States Government Accountability Office, document 09-386. p. 26. Retrieved 2012-01-27.
  30. ↑ "Hertz to provide electric cars for rent". The Seattle Times. The Associated Press. 21 September 2010. Retrieved 8 February 2011.
  31. ↑ Eric Loveday (2011-07-20). "Hertz on Demand is a bit like ZipCar without membership fees". AutoblogGreen. Retrieved 2011-07-20.
  32. ↑ Belson, Ken (2008-12-16). "Hertz Will Try to Connect With the Carless". The New York Times. Retrieved 2010-12-08.
  33. ↑ "Connect by Hertz Expands in Key European Capitals of Berlin and Madrid". MarketWire.com. 2009-12-02. Archived from the original on February 16, 2011. Retrieved 2010-12-08.
  34. ↑ http://www.travelweekly.com/Travel-News/Car-Rental-News/Hertz-to-cease-car-sharing-services-in-US
  35. ↑ http://www.travelweekly.com/Travel-News/Car-Rental-News/Hertz-to-cease-car-sharing-services-in-US
  36. ↑ "Connect by Hertz Drives Onto University of Maryland Campus". MarketWire.com. 2010-04-08. Archived from the original on June 16, 2011. Retrieved 2010-12-08.
  37. ↑ "Hertz Installs EVs in NYC Car Sharing Club". Auto Rental News. 2011-05-06. Retrieved 2011-05-22.
  38. ↑ Motavalli, Jim (2010-12-07). "Hertz Puts Electric Cars on the Fast Track, Starting in New York". The New York Times. Retrieved 2010-12-08.
  39. ↑ "Hertz Details Hourly Electric Car Rentals Including Nissan, Chevy, Mitsubishi, Tesla, Smart, and Coda". PluginCars.com. 2010-12-06. Retrieved 2010-12-08.
  40. ↑ Loveday, Eric (2011-04-20). "Hertz offering Mitsubishi i-MiEV rentals in UK". AutoblogGreen. Retrieved 2011-05-22.
  41. ↑
  42. ↑ "Ad Age Advertising Century: Top 100 Campaigns". AdvertisingAge. Crain Communications. Retrieved 29 December 2012.
  43. ↑ Moore, Jonathan (Nov–Dec 2008). "Open Window to History: A look back at the improbable conservation of the Texas School Book Depository". Texas Architect. Texas Society of Architects: 22–25. Retrieved 2011-01-27.
  44. 1 2 Boyd, Todd (2008). African Americans and Popular Culture: Theater, film, and television. pp. 86–87. Retrieved 2011-01-27.
  45. ↑ "Corporate Governance Overview Archived June 24, 2009, at the Wayback Machine.." The Hertz Corporation. Retrieved on June 14, 2009.
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