Hertz Global Holdings Inc. is replacing its chief executive officer in the wake of a disastrous bet on electric vehicles that the company began unwinding in recent months.
Stephen Scherr, who ran Hertz for just over two years after three decades at Goldman Sachs Group Inc., has decided to step down, the rental-car company said late Friday in a statement. It’s replacing him with Gil West, the former chief operating officer of General Motors Co.’s Cruise robotaxi unit. West also will join the board of directors on April 1, according to the statement, which confirmed an earlier Bloomberg report.
Scherr, 59, joined Hertz several months after it emerged from bankruptcy and started making splashy wagers on electric vehicles. Under new owners Knighthead Capital Management and Certares Management, the rental company announced plans to order 100,000 vehicles from Tesla Inc., sending the automaker’s market capitalization soaring past the $1 trillion mark at the time.
Hertz doubled down on EVs in the months after Scherr took over, placing big orders with Polestar, the electric-car maker owned by China’s Geely and Sweden’s Volvo Car, and GM. The company ended up buying a small number of cars from the two companies, a spokesperson said.
Those bets went awry last year, when Tesla slashed prices across its lineup to keep growing vehicle sales. This hammered the resale value of used Model 3 sedans and Model Y crossovers just after Hertz had added tens of thousands of those vehicles to its fleet.
By December, Hertz started selling off 20,000 electric vehicles, or about a third of its EV fleet. Germany’s Sixt SE — a leading car-renter in Europe — is taking even more drastic measures, phasing Teslas out of its fleet entirely.
Hertz announced its EV sell-down plans in January, citing lackluster demand, costly depreciation and expensive repairs. The Estero, Florida-based company took a $245 million charge and reported its biggest quarterly loss since the pandemic.
Shares of Hertz fell 2% after regular trading in New York Friday.
fortune.com
Stephen Scherr, who ran Hertz for just over two years after three decades at Goldman Sachs Group Inc., has decided to step down, the rental-car company said late Friday in a statement. It’s replacing him with Gil West, the former chief operating officer of General Motors Co.’s Cruise robotaxi unit. West also will join the board of directors on April 1, according to the statement, which confirmed an earlier Bloomberg report.
Scherr, 59, joined Hertz several months after it emerged from bankruptcy and started making splashy wagers on electric vehicles. Under new owners Knighthead Capital Management and Certares Management, the rental company announced plans to order 100,000 vehicles from Tesla Inc., sending the automaker’s market capitalization soaring past the $1 trillion mark at the time.
Hertz doubled down on EVs in the months after Scherr took over, placing big orders with Polestar, the electric-car maker owned by China’s Geely and Sweden’s Volvo Car, and GM. The company ended up buying a small number of cars from the two companies, a spokesperson said.
Those bets went awry last year, when Tesla slashed prices across its lineup to keep growing vehicle sales. This hammered the resale value of used Model 3 sedans and Model Y crossovers just after Hertz had added tens of thousands of those vehicles to its fleet.
By December, Hertz started selling off 20,000 electric vehicles, or about a third of its EV fleet. Germany’s Sixt SE — a leading car-renter in Europe — is taking even more drastic measures, phasing Teslas out of its fleet entirely.
Hertz announced its EV sell-down plans in January, citing lackluster demand, costly depreciation and expensive repairs. The Estero, Florida-based company took a $245 million charge and reported its biggest quarterly loss since the pandemic.
Shares of Hertz fell 2% after regular trading in New York Friday.
CEO steps down after being hit with expensive EV repairs and low resale prices following purchase of 100,000 Teslas
Stephen Scherr ran Hertz for just over two years before stepping down on Friday.
