Global car rental firm Hertz has announced it is increasing its daily fees for car rentals from US depots with effect from next month. The hikes will see the average cost of a smaller sedan rented from Hertz and affiliates such as Dollar and Thrifty rise to up to US$50 (£31.80) a day.
Hire fees for Hertz vehicles rented from on-airport depots are set to go up by US$5 (£3.18) a day and the weekly rate by US$20 (£12.72). Rates for vehicles rented from other Hertz stations will increase by US$3 (£1.90) a day and US$10 (£6.36) a week.
Business analysts in the US say the price hikes are all part of Hertz CEO John Tague’s master plan to propel the company back to the top spot of preferred vehicle rental supplier. The move will allow Hertz to operate a smaller fleet and reap the benefit of extra income at peak holiday times.
Adam Jonas is an analyst with Morgan Stanley and he says the rental fee increases will make investors happier. Hertz released first quarter figures recently which showed a three per cent decline in revenue. Accounting errors from four years ago are also behind Hertz’s decline in profitability.
Mr Jonas noted that Hertz’s car hire fee increases were the biggest ever announced in a fiscal year. Rival firm Enterprise Holdings has 50 per cent of the US car rental market and has so far not announced whether it will follow suit. Mr Jonas said Enterprise could reinforce its position in the field with lower prices and more airport vehicles.