Hertz, Amazon Partner to Sell Used Cars Online, Hertz Stock Surges 10%

Hertz Global Holdings, Inc. (HTZ.US) has announced a strategic partnership with Amazon (AMZN.US) to sell used cars through Amazon's automotive platform. This collaboration is set to begin on Wednesday, allowing consumers within a 75-mile radius of Dallas, Houston, Los Angeles, and Seattle to browse and purchase used cars directly from Hertz on Amazon's platform. The online process will enable buyers to complete all necessary paperwork digitally and pick up their vehicles at a nearby Hertz location. This initiative is expected to expand to 45 Hertz dealerships across the United States, enhancing the convenience and accessibility of used car purchases.

This partnership marks a significant development in Amazon's ongoing expansion into the automotive sector. Amazon's automotive services, initially launched in December of last year in collaboration with Hyundai, allowed consumers to browse digital showrooms and compare prices online. However, direct purchasing capabilities were not available at that time. In early this month, Amazon began piloting the sale of used and certified pre-owned cars in Los Angeles, further advancing its automotive ambitions.

Hertz's fleet of used cars, which includes brands such as Ford, Toyota, Chevrolet, and Nissan, will be the first to be listed on Amazon's automotive platform. This move not only diversifies Hertz's sales channels but also aligns with Amazon's strategy to integrate more physical goods into its digital ecosystem. The collaboration is expected to have a ripple effect on the used car market, with Hertz's stock price surging by approximately 10% in pre-market trading, reflecting investor optimism about the partnership. Other players in the used car retail sector, such as Carvana, experienced a decline in their stock prices, underscoring the competitive nature of the used car market and the potential for significant shifts in market share as major players like Amazon and Hertz enter the fray.

The partnership between Hertz and Amazon represents a strategic move for both companies to capitalize on the growing demand for online car purchases. By leveraging Amazon's robust e-commerce infrastructure and Hertz's extensive fleet of used cars, this collaboration aims to provide consumers with a seamless and efficient car-buying experience. As the initiative expands to more locations, it will be interesting to observe how this partnership reshapes the landscape of the used car market and influences consumer behavior.