No one likes to hear that a company is raising its prices. However, sometimes it becomes necessary for a company to do that because of inflation. This is just what happened with Hertz during the weekend of Dec. 19 to 21. The price increase applies to not only the Hertz rental brand but also to the Dollar and Thrifty car rental brands. It will be applied to all cars that are picked up on or after Jan. 1, 2015.
John Tague, CEO and president of Hertz, said that fleet costs have been on the rise for a while. This is mostly because of declining residual values. As a result of this decline, Hertz has no choice but to implement an increase in prices across all of its car rental brands in the United States. This is part of the company pursuing ways to reduce costs. This is in addition to the $100 million that the company already announced will be cut in expenses. All of this will lead to a number of improvements at Hertz, including refreshing the car rental fleet that it has to offer.
For those who do not know, Hertz operates a number of car rental brands, including Firefly. The company operates 11,000 licensee locations in 140 countries in Europe, North America, Asia, Africa, Latin America, Australia, New Zealand and the Middle East.
Hertz has made a name for itself in recent years for being the world’s largest airport general use car rental company. This was achieved by making its cars available in more than 1,700 airports across the United States. Vehicles are also available in 1,300 airport locations around the world. Additionally, Hertz offers many great products and services, including the NeverLost navigation system, Carfimrations, Hertz Gold Plus Rewards and Mobile Wi-Fi. For Hertz to continue offering these kinds of services, it has to find ways to increase profits, and increasing car rental rates is the quickest way to do this.
Hertz did say that this announcement is forward-looking. This means that it includes information about the company’s liquidity and assumed future results. Since these results have yet to be reached, the outcomes may still vary. This is why the forecast includes such words as planned, estimate, may, anticipate and so on. Although it hopes to achieve these goals, there is no way for the company to accurately predict everything that is going to happen.