Electric cars don't (yet) make good rental vehicles, a fact firmly established after Hertz bought 40,000 of them and ultimately had to ditch them at giveaway prices. The company is going back to gasoline and the CEO has been dealt with.
The company announced that Stephen Scherr, who came to the company two years ago after nearly 30 years at Goldman Sachs, is stepping down at the end of this month. He'll be replaced by Gil West, former chief operating officer of Delta Air Lines and General Motors' Cruise unit. In the most recent quarter, Hertz took a $245 million hit to its earnings due to a drop in value of the EVs it was selling.
Hertz did not manage the fleet as it should have done. There was key failure it could have avoided: it didn't put charging stations in or near its depots, and one it was stuck with: astronomical maintenance and repair costs.
"The execution and marketing of EV's [by Hertz] was a horror show across the board," said Daniel Ives, an analyst with Wedbush Securities who follows the EV market. "It's a black eye they couldn't recover from."
Don't worry about Mr. Scherr, though. He's fine.
According to the company's 2022 proxy statement filed April 5, 2023, Scherr's total compensation that year was $182.1 million including $178 million in stock awards and a salary of $1.27 million, but excluding any sign-on compensation. Why so much? That's unclear, but according to a company filing: "This amount reflects Mr. Scherr's total compensation calculated in accordance with SEC rules and does not reflect the actual taxable compensation he received for 2022 or the compensation that he may realize in the future. For reference, Mr. Scherr's wages for 2022, calculated for purposes of his Form W-2 issued by the company, were $27,181,395."
