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Document123 2
Document123 2
Document123 2
and accept the need. Charismatic transformation can win support for the change if leaders communicate
a compelling vision and trust them to deliver the promised outcome. Forced transformation can be
successful if key stakeholders recognize and respect the leaders' authority. Dictatorial transformation
can be successful if stakeholders anticipate few benefits or fear harmful outcomes.
The well-known rental vehicle company, Hertz Global Holdings Inc., had a spectacular metamorphosis
after declaring bankruptcy. Under the direction of CEO Stephen Scherr, Hertz recovered from insolvency
in the second quarter of 2021 by utilising the booming used car market and putting in place a thorough
reorganisation strategy. Hertz adopted a futuristic growth plan that prioritized electric cars (EVs) and
artificial intelligence (AI) in addition to financial reform. The business made large expenditures, which
included buying 100,000 electric vehicles from Tesla, incorporating AI technologies for operational
optimisation, and working with local governments to build charging stations for electric cars. Hertz's
reinvention shows its resiliency, inventiveness, and dedication to satisfying shifting client needs in the
constantly shifting transportation industry amid a mixed reaction from the market.
The management of Hertz Global Holdings was forced to change. In order to triumph over its economic
struggles and preserve its continued existence, the corporation had to undertake considerable
adjustments or risk insolvency. The desire to pay off debt and create revenue, for example, were outside
factors that sparked the shift. Hertz took advantage of the chance given by the expanding used car
industry to jumpstart its recovery. An intentional shift in strategy and a forward-thinking reaction to the
changing market trends may be seen in the choice of accepting AI and electric automobiles as growth
directions. The necessity to handle the economic downturn and set up the business for long-term
profitability is perhaps what motivated the shift.
https://www.forbes.com/sites/gurufocus/2023/01/27/hertz-is-this-promising-turnaround-moving-too-
fast/?sh=60468bc62a69
To paraphrase its 1960s advertising campaign, a revived Hertz is prepared to put investors "in the
driver's seat." But this Hertz is not the one from the past. Prior to 2020—and its filing for bankruptcy—
the corporation was well-known in the sector as the bad actor for periodically starting price battles that
exacerbated the boom-and-bust character of the industry. Three financially responsible businesses now
control 90% of the U.S. market for automobile rentals: Hertz Global Holdings (ticker: HTZ), Avis Budget
Group (automobile), and the privately held Enterprise Rent-a-automobile. This has led to a more stable
and effectively managed sector than ever before.
Hertz seems to be the most impressive of the group. It has repurchased over 30% of its stock since
coming out of bankruptcy in mid-2021 and continues to be very profitable. It also leads peers in
expanding its fleet of electric vehicles. Hertz is currently trading at a recent price of $19, which values
the company at eight times its estimated $2.32 per share earnings for 2023.
Bary, A. (2023, February 10). Buy Hertz stock. it’s cheap, well-run, and renting Teslas.
Barron’s. https://www.barrons.com/articles/buy-hertz-stock-price-pick-renting-teslas-
2fabe456