Hertz's Leadership Overhaul and Strategic Turnaround Prospects

In the high-stakes arena of the mobility market, Hertz Global Holdings (HTZ) has embarked on a transformative journey. The company's recent leadership overhaul and board expansion signal a bold attempt to stabilize its fleet costs, enhance operational efficiency, and unlock shareholder value. But can these changes catalyze a sustainable turnaround in an industry marked by fierce competition and economic volatility?

A Leadership Overhaul with Strategic Intent

Hertz's 2025 leadership changes, including the appointment of Chris Berg as CFO and Lauren Fritts as Chief Communications Officer, reflect a deliberate effort to strengthen its executive team. Berg, a seasoned operator with a five-year track record at Hertz, has been instrumental in executing the “Back-to-Basics Roadmap,” a strategy focused on disciplined fleet management, revenue optimization, and cost control. Fritts, meanwhile, brings expertise in corporate communications, a critical asset as Hertz seeks to rebuild stakeholder confidence.

The board's expansion from nine to 11 members, with the addition of Mr. Frahm and Ms. Fran Bermanzohn, further underscores a commitment to governance and strategic oversight. These new board members are expected to contribute specialized knowledge in finance and corporate strategy, aligning with Hertz's goals of operational rigor and long-term value creation.

Operational Efficiency and Fleet Cost Stabilization: A Proven Framework

Hertz's operational turnaround under Berg's leadership has been nothing short of remarkable. By 2025, the company reduced depreciation per unit (DPU) to $251 per month—well below its North Star target of sub-$300—through a “Buy Right, Hold Right, Sell Right” strategy. This involved acquiring newer, lower-depreciating vehicles and accelerating the sale of older assets. Over 80% of the U.S. core rental fleet is now less than a year old, a testament to disciplined fleet rotation.

Direct operating expenses (DOE) per transaction day have also improved, dropping to $36 in Q2 2025, reflecting cost discipline and operational agility. Hertz's vehicle utilization rate climbed to 83%, up 300 basis points year-over-year, demonstrating better asset deployment. These metrics highlight a company that has moved from crisis mode to a path of sustainable efficiency.

Shareholder Value: From EBITDA Recovery to Liquidity Strength

Hertz's financial trajectory has been equally compelling. The company reported its first positive adjusted corporate EBITDA in Q2 2025, ending a seven-quarter streak of losses. By Q3 2025, it is projected to achieve its first positive EPS since 2023. Liquidity has also improved, with $1.4 billion in corporate liquidity as of June 2025, providing a buffer against debt maturities in 2026.

The board's focus on deleveraging—via an At-The-Market (ATM) Equity Offering—further strengthens the balance sheet. With no significant corporate debt maturities until 2026, Hertz is positioned to navigate macroeconomic headwinds while maintaining flexibility for strategic investments.

Risks in a Volatile Market

Despite these gains, challenges persist. The mobility market remains highly competitive, with rivals like Enterprise and Zipcar vying for market share. Additionally, supply chain disruptions and fluctuating vehicle pricing could pressure margins. Hertz's reliance on U.S. markets also exposes it to regional economic shifts.

Moreover, the recent leadership changes must prove their ability to sustain momentum. While Berg's track record is strong, the new executives and board members must integrate seamlessly into the existing strategy. Shareholders will be watching closely for signs of continuity and innovation.

Investment Thesis: A Calculated Bet

For investors, Hertz presents a compelling case of a company in transition. The leadership team has demonstrated the ability to stabilize costs, improve fleet economics, and restore profitability. With a revised full-year EBITDA outlook and a long-term target of $1 billion in adjusted EBITDA by 2027, the company is laying the groundwork for durable growth.

However, caution is warranted. The mobility sector's volatility and Hertz's debt load remain risks. Investors should monitor key indicators: DPU trends, DOE per transaction day, and liquidity levels. A could provide further clarity on its competitive positioning.

Conclusion

Hertz's leadership overhaul and strategic initiatives have catalyzed a meaningful turnaround. While the road ahead is not without obstacles, the company's focus on operational efficiency, fleet cost stabilization, and disciplined capital management positions it to unlock shareholder value. For investors with a medium-term horizon and a tolerance for risk, Hertz offers a unique opportunity to capitalize on a transformation story in the mobility sector.