Hertz Corporation

The Hertz Corporation is an American car rental company based in Estero, Florida. The company operates its namesake Hertz brand, along with the brands Dollar Rent A Car, Firefly Car Rental and Thrifty Car Rental.

It is one of the three big rental car holding companies in the United States, holding a 36% market share, placing it ahead of both Enterprise Holdings and the Avis Budget Group. As one of the largest worldwide vehicle rental companies by sales, locations, and fleet size, Hertz operates in 160 countries in North America, Europe, Latin America, Africa, Asia, Australia, the Caribbean, the Middle East and New Zealand.

Hertz was ranked 326th in the 2020 ''Fortune'' 500 list. The company filed for bankruptcy on May 22, 2020, citing a sharp decline in revenue and future bookings caused by the COVID-19 pandemic. As of December 31, 2021, the company had revenues of $7.3 billion, assets of $19.7 billion, and 23,000 employees. As of July 1, 2021, the company is no longer in Chapter 11 bankruptcy.

History

The company's early years

The Hertz Corporation, originally known as Rent-a-Car Inc., was founded by Chicago, Illinois native Walter L. Jacobs in 1918. This small car rental operation began with a dozen Model T Ford cars. Within five years, Jacobs' fleet expanded to 600 vehicles—generating annual revenues of approximately US$1 million. John D. Hertz, owner of Yellow Truck and Coach Manufacturing Company, developed an interest in the brand, leading to him purchasing the company in 1923. It was then renamed to Hertz Drive-Ur-Self System. Jacobs continued to serve as president and chief operating officer of Hertz Drive-Ur-Self System until 1961.

After three years of ownership, John Hertz sold the rental car brand to General Motors Corporation in 1926. GM purchased the rest of Yellow Truck and Coach Manufacturing Company in 1943. Under the ownership of General Motors, the company released the first rental car charge card in 1926, opened its first rental car location at Chicago's Midway Airport in 1932, and introduced the first one-way rental plan in 1933. Hertz Drive-Ur-Self System expanded services to Canada in 1938 and Europe (France) in 1950.

Development of the corporation

John Hertz repurchased the brand from General Motors in 1953 through his other company, The Omnibus Corporation, which he renamed to The Hertz Corporation. In 1954, its stock began trading on the New York Stock Exchange, and it purchased a New York-based truck leasing company, Metropolitan Distributors, including a fleet of 4,000 trucks. This acquisition increased The Hertz Corporation's fleet to 15,500 trucks and 12,900 passenger cars. During the General Motors ownership, the company had sold many local Hertz franchises to independent business entities. With the financial backing of investment bankers Lehman Brothers, led by Lehman partner and Hertz director, Frank J. Manheim, Hertz began a buyback program for the franchises in the US, then expanded globally. Manheim predicted the global growth and devised the strategy which made “Hertz” a household name and led to dynamic growth in the company's market capitalization from $7 million in 1953 to $100 million in 1965.

The company expanded to South America in 1961. In 1967, The Hertz Corporation became a subsidiary of Radio Corporation of America. In 1985, the car rental company was sold to UAL Corporation, later known as Allegis Corporation, for a cash deal of US$587.5 million. This acquisition expanded Hertz's vehicle renting and leasing, with nearly 400,000 cars and trucks in 120 countries across the globe.

In the summer of 1987, Allegis Corporation chairman and president Frank A. Olson announced the company would be selling Hertz due to internal changes. Park Ridge Corporation, which was owned and operated under Ford Motor Company, purchased Hertz in October 1987 for US$1.3 billion, and Hertz relocated its headquarters from Midtown Manhattan to Park Ridge, New Jersey