CareCredit - Women's Health April 2024

Hertz CEO Departs Following EV Troubles

Hertz’s CEO is stepping down following the company’s major shift on the electric vehicle front.

Stephen Scherr, who joined the rental car giant in 2022, has announced his resignation, Hertz said Friday (March 15). Taking his place is Gil West, former chief operating officer of Delta Airlines and General Motors’ Cruise unit.

“Gil’s success in leading over 70,000 people at Delta and orchestrating highly effective operational turnarounds will position him well to lead Hertz,” Colin Farmer, lead director of the Hertz board, said in a news release.

“He will be able to build upon the strategic projects begun during Stephen’s tenure, including improvements to technology, commercial partnerships and the revitalization of our value brands.”

The news comes weeks after reports that Hertz was weighing job cuts after selling off about a third of its electric vehicle (EV) fleet, saying it was losing money on the cars. In an interview with Bloomberg News at the time, Scherr said the company was aiming to save $250 million in other costs, which may include layoffs.

“The company clearly took on more EV exposure than where the market otherwise took us,” Scherr said. “The decision we made in the fourth quarter to make a pivot on EV sets us up for a transitional year that’s achievable. We’ll spring into 2025 a better company.”

In addition to selling its EV fleet, the company also halted plans to purchase tens of thousands of EVs from Sweden’s Polestar. As PYMNTS wrote last month, this is part of a larger pattern.

“While electric vehicles have been celebrated for their potential to revolutionize transportation and accelerate the path toward a greener future, recent moves by original equipment manufacturers (OEMs) to scale down production, divest and cut funding have cast a shadow over this once-optimistic narrative,” that report said.

And this week saw reports that EV sales were slowing due to consumer reluctance, fueled by a lack of a reliable and convenient charging infrastructure.

PYMNTS’ CEO Karen Webster noted late last year that EVs were “having their own early adopter moment.”

While early adopters were in a hurry to become the first to own an EV — and probably had another car to drive while the EV was recharging — mainstream consumers are more worried about EVs’ shorter driving ranges and underdeveloped charging infrastructure, she wrote.