Hertz Global (HTZ) 7 May 192019 Q1 Earnings call transcript

Welcome to the Hertz Global Holdings First Quarter 2019 Earnings Call. [Operator Instructions]. I would like to remind you that today’s call is being recorded by the company. I would now like to turn the call over to your host, Leslie Hunziker. Please go ahead.

everyone. morning, Good should information. you press and release By have financial associated now, our We’ve conference accompany be to also slides provided our our accessed website. call on can that call certain I made you to information. that want on remind this contain forward-looking statements

the and and obligation call Forward-looking are to their of speaks information results differ only subject statements information to forward-looking date Actual nature, materially. uncertainty. as by Any circumstances. of the inherent related changed are no guarantees may not update company performance undertakes to on reflect this this

the are Additional information and earnings that profitability the from Hertz section the and GAAP reconciled concerning are XXXX of these Today, contained metrics. is posted website. or website. of XX-K these in using certain filings when on press which Statements we’ll first is our statements with all measures, non-GAAP Risk non-GAAP release, will our and the press our is XX-Q SEC be of Forward-Looking and Form believe Copies Form on performance in available financial release better XXXX which quarter demonstrated our and numbers filed. Factors our these in use We

focuses Hertz the publicly-traded Inc., Global Hertz Results for same company. the Our Holdings Hertz today Corporation call the on materially Holdings. are a as Global

this call Marinello, our Chief CEO; have the morning, On Kathy Hertz’s we Officer. and Jamere Financial Jackson,

to over the turn Kathy. I’ll call Now,

Leslie morning good everyone. and you, Thank

improves we Rate strategic In trends of tools last X% progress improvement the X% rose of seventh sophisticated higher and continued revenue forecasting in levels, up in X% We’re pleased the year, year’s adjacent pricing the volume per on in markets entry a make with the generated unit, earnings continue to vehicle our on in quarter and and efficiency upgraded U.S. Total top improvement. our year-over-year measure a was we improvement actions; increase a quarterly to time performance X% U.S., TNC X% first where increased driving quarter, year-over-year. and management fleet also Volume and X% positive. RPD as key X% U.S., service pay dividends. revenue mileage consecutive first like and continue marketing demand the revenue and into was and last growth. asset revenue

– Easter first delivering from resources and calendar the We degree, are headwinds, to winter period the focused despite macro are quarter these top-line to because and track. we strengths remain first satisfying for as the on driving us, were In weather these stay leveraged lesser quarter our Midwest. that, we a negative into shift from even seasonally growth. our results challenges Yet the sustainable is low And second we know, demand. to for the the our a some you had impact effect overcome. the on quarter, severe more After in

In concerns improvement a life in higher growth addition and X% revenue total Globally, on the the capitalizing significant a and strategies, to market corporate to a in monthly Brexit day, $XX to the Europe in volume rental per still first quarter. the depreciation help us and we per monthly and XX% reduce Worldwide, first quarter. control a across business continuing million increase growing led delivered EBITDA value travel higher to costs vehicle optimize X% our car This in revenue by relating protests. U.S. Paris depreciation capitalize U.S., car, rotating unit adjusted rental fleet in unit in despite the to strong replacement in of accounts, by portion insurance enables opportunistically disposal in acquisition TNC to on XX% with fleet on fleet residuals. and asset to the and we’re revenue creating per reduction

year this to a also productivity continue we’ll making management, savings. we’re fleet cost global revenue While focus to on driving commitment and

goal Our part levels doing that the service employee expense our product greater every own drive without programs impacting to and bring our initiative. discipline quality, are control the or their world base dollar and growth. is to Employees around

a returns awareness first throughout processes we’re of fruit the captured shared culture an the specific profit-focused for part prioritizing addressing Jamere Employees what the important value and earnings. of that’s business. implementing measuring share are projects customer. in best perspective across field we’ve plans and we accountability strengths, is based put our practices the of larger in on year. some plays productive By supply creating and individual creating achieved the chain functions with scale areas We’re in maximizing a the what the overhead the active will role analyzing taking more some optimally I’m quarter opportunity. pleased looking as of hanging in and of in to But low from place

XXXX. of cost beginning enhanced effective platform for more customized in to global to roll is our rental group The well back fleet management assets, digital encompasses transformation the CRM capabilities, office addition support technology systems. commitment as In our us out and another major platforms, standardized reservation our technology as

in All platform these visibility analytics. greater a access, and of data and assets allows for speed are cloud-based that sharing being integrated

customer app experience. and our us now rolling great our functions Let unify customer sales allows April, released reps rental updated a that cloud all certain on organization personalized the individual customer Last an efficiency from address me CRM customer out where Hertz so experience key of received greater into strategies our customer continuously gives our overall. that you customers improve in of our and deeply while The customers providing the us give far. advanced we improving enhance and like tracking, information. more insight greater and relationships month, interaction will update This us we services enables the around giving also circumstances tasks digital advanced cloud-based suite ensure began the initiatives. service to ability faster of to customer marketing accessing world to system. are same stand. preferences focused our automate us a It our more We’ve of we redesigned and feedback supporting to Also, features the

will allow Year have then New U.S. powered cutover revenue wide improvements peak throughout year-end. in and edge AI-enabled behind. to that off our feel North more with have revenue integrated U.S. system regard the pricing demand integration in of this overseas this acceptance technologies, fall. we couple a the international deployment by of just launch make. our transformation July four made also should between efficiently then season in August. tier small closely after user leading the expansion. The kicks and EMEA continue we activating XXXX utilization the full with management now January really strategically and be the in technology maximize we the transformation. starting testing and that a month. platform, strategy progress a is positioning before good system replicate plans enterprise for field on kick to Besides complex capabilities follow with and with off plan markets region for in to markets to assets next larger, We America integrated the about testing to the the working Once With us more goal We’ll transition will Having forecasting be our completed, Additional that’s margin worldwide system

feels When leisure what U.S. incrementally in signs apparent with it it optimistic comes forward look can on As commercial travel deliver to the economy, we XXXX. softening. no or stable about I of

the that comps a but goal Hertz, the get tougher, year-over-year For little of change doesn’t improvement.

our producers managers. and We and makers continue focus to on be fleet continue to unwavering. disciplined auto of volume rate is The be the trifecta disciplined utilization

grow expect ride-hailing in with we fleet year-end. business, fully a For the XXXX significantly TNC to again, by connected

got important refinancing debt Finally deck. in the U.S., we’ve an on

to comes new based productivity this and Hard tough yellow well trends there’s great a are you, UK the expected, area. to and that Egypt Turkey, on success Brexit this. Therefore, is technology being heat destinations are the XXXX’s me demand are understand still delivery big the productivity ask They it careers will We’ve plans happening dedicated but unusual in the asset forecast positioned over Cup that us to track. performance to with World for Tunisia. It’s regarding up, we’re that smarter people our and value our potential got fleet on in on fleet our are reinvest season I’m and are shifts economic all in The hands team. uncertainty and employees relates top-of-mind and project the better our the top-line and the our day leads if and impact confident As to has it putting leveraging growth. more and submitted ideas XXXX allows yield costs. the wave After to value opportunity getting impressed we’re place. some we’re teams than we’re in partners we’re Europe, savings, for reward employees got the decision-making. execute. executed to milestones all, averse of as peak we’re of big and simply for It’s it’s our in tools brought the processes and impacting better the Jamere and every on They’re great When a vacation year told prudent countries we the also planning, shareholders. comes same in we’ll considering in place. IT our improvement, from in the in it jackets. to as this franchise travel this these strategies And risk that us. optimizing to Globally, all international technology and In return work profit driving done. find updates maximizing like company, that through take AI stepped efficiencies Daily

best work an of partners, the execution iconic be right goes time. We our have it’s critical, brands. of a exciting saying and that great will people, but fleet, also lot do the course, it We’ve and to without got

game-changing tools pipeline. AI in the have We’re new technologies globalizing and

the over performance. into first that, detailed on We’re to Jamere to going quarter we’ve updating capitalize look I’ll With more it to to progress. turn our to forward on give and created momentum you continue I insight the you

Thank everyone. a had good morning quarter. you great we first Overall, Kathy, and

Our productivity, delivered growth helped and top-line focused continued growth on us and expansion. margin

revenue execution continue Our transform solid improvement while invest and adjusted in corporate the we resulted year-over-year both our business. EBITDA in to quarter and in

we Adoption assets on corporate did X, item net net as share us earnings known a January as not leases. standard details, per associated on impact EBITDA. and in adopted or adjusted Before housekeeping topic balance into which record ASU $X.X the new sheet there an reported one I is required to liabilities our XXX, also previously income, of the lessee billion with leases, XXXX-XX on corresponding to a get have

impact XXXX adjusted XXX accounting of in under or not EBITDA quarter In in did addition, first corporate materially our the XXXX. revenue

of overview an billion by XXX total up $X.XX company our non-GAAP results. per results and $X point on partially million, quarter an International our by in a of results provide Global X U.S. diluted quarter. first revenue $XXX On our improved on me Net corporate segment, let and adjusted our Slide a GAAP improvement versus in to in of and XXXX. net business. a our to drag our a basis marking adjusted $X.XX, of and basis negative first the quarter up non-GAAP U.S. First, was were consolidated X% Hertz attributable Total margin was corporate seven the XX% $X.X basis our RAC loss EBITDA for shows for loss a driven of currency expanded XXXX million first offset EBITDA measures X% points. from was the seventh by loss on growth currency constant due growth segment. consecutive solid foreign share revenue basis, RAC X% The quarter revenue to

loss results and initiatives. of quarter primarily share Our XX% productivity in $X.XX loss volume vehicle and the of adjusted to net by higher our RAC depreciation RAC to These per $XX partially to impact U.S. revenue business increased expense were adjusted a vehicle corporate and transformation pricing, our million year EBITDA quarter. from offset were $X.XX loss driven initiatives interest increased prior from investments by improved in spending the the lower in and our improved support diluted expense operations. a for Adjusted our

with starting with Let segment, me and I’ll quarter start U.S. provide the RAC some additional color on revenue. our

business billion X% U.S. U.S. Our Total prior were versus RAC $X.X revenues outstanding quarter. another up year. RAC had

RAC we volume behind segment, growth approximately contributed U.S. TMC XX% points our saw pricing volume grew U.S. three of strong Our for percentage strong and the revenue business Overall, and through business. RAC RPD versus growth and prior RPD up year and days a pricing grew X% increase and transaction total with TNC driven ex-TNC quarter X% X%. T&M in X%. up by was Total rate

which growth airport adjusted In versus and continue $XX U.S. in EBITDA $X to million, leisure. on the business a a off both we both positive drive was quarter. prior-year corporate RAC addition, revenue improvement and and million was

monthly driven top-line were vehicle strong solid XX% growth, a Our results per and by productivity. decrease unit’s depreciation in

We to of while marketing deliver to continued building brand management, productivity. in execution fleet strong disciplined technology and drive innovation on our and we service customer invest

expenses We’re the also see year. laser we’ll move we operating productivity in as direct and on driving through focused additional and improvement SG&A

during said continuing we’re profitability. Fast I innovation of building front. are and transformation operations the our QX expansion The app invest exciting IT this CLEAR, As track drive growth capabilities progress will and our Hertz earnings call, on by and evidence new that mobile rollout new Lane technology, both powered further XXXX our we’re and in recent of efforts on long-term in faster our to Hertz of

turning fleet. Now, to

to up X% go as capacity we managing rigor up ex-TNC demand after our in was our fleet manage profitable and Vehicle with fleet discipline. was X%, type costs utilization continue the We fleet lowering continue capacity U.S. or and fleet. Fleet and XX% to a

Moving unit, XX% execution. fleet per year decreased of strength result $XXX vehicle depreciation expense depreciation was in quarter. unit expenses vehicle solid the and prior decrease of the disciplined value The to depreciation, of residual acquisition, monthly versus

are Our on our a year than costs from model buy year like-for-like lower vehicle averaging XXXX acquisition basis XXXX. model

of to the the high XXXX. channel through to drive increase retail quarter continue strong better return also continued sales We unit throughout on a depreciation first be outcomes and market to

our initiatives, sales Moving in vehicle our non-program up dispositions XX% the were quarter. fleet to

retail grew same-store Lauderdale X%. for have us channel the while sales that I’ve is currently our car dispositions before, and XXXX. during Indianapolis, to before unit XX quarter, San versus stores plans We but open XX% opened capability tremendous locations As year and sales new end locations Fort said a asset through grew quarter sales Cleveland, and the in hertz more Diego, of we prior

RAC our RPD basis. at currency Total on international to constant was X% Moving down down days X% X%. were but flat million, were revenues transaction grew segment. $XXX and a

leisure Our growth business in volume saw both solid business the segments. in customer Asia Pacific and

uncertainties some overall, saw softness Although in the markets in the up volume UK Europe like to was we France. political due and lingering

continue expanding revenue focus international fleet capabilities organization. We and to management on our to our

in when EBITDA The our reflects the reap segment fully which to what benefits currency of reported similar million RAC to we’ve We expect seen the $XX impact [ph], corporate negative revenues executed. foreign U.S. of international adjusted on and expenses.

below liquidity like and covenant ended to corporate term, update October financing the well free our an Before refinancing ratio under as derisk evaluating near We credit closing, we $X times provide first-lien three the In maturing the with maintenance further balance I’d times. corporate in maximum of was of are we on revolving debt sheet. our billion of our corporate corporate with senior quarter facility X.X XXXX flow. activities, drawings in liquidity our the cash and no

cause of the from drove cash, timing in the and flow free It of fleet can quarter-to-quarter. ABS marks, which the rebates use volatility quarter. to cash Turning

dynamics normalized to as indication The fleet assumed is vehicle year. these our offset cash continues a partially year-over-year gain use $XXX operational through moved expect improvement in operating million traction. out was which solid We turnaround a our we and cash flow, depreciation, that excluding by the

XXXX of quarter the wrap reflects in turnaround. So, first our up continued momentum

higher faster-growing and by innovation has we’re Our to building productivity solid The U.S. fleet higher opportunity management, driving catalyst and and in RAC margin brand initiatives growth drive higher including the a are and delivery price focused the are we delivered growth momentum. TNC see X% business. efficiency we driven margins, business and our tremendous on building driving and business, excellence, operational a are for service capabilities and marketing volume,

for forward in drive over And the long-term our that coming We’re look quarters. value. to it operator questions. progress our to confident updating now on in back shareholder ability I And with the I’ll you to turn

you Deutsche Woronka Chris go Our will with Thank first [Operator Bank. Instructions] ahead. Please much. from question come very

everyone. morning good Hey,

can maybe Another that impressive get? color just how TNC quarter you that program the on big rentals, on ultimately think little a

we’re better way approaching the The use more returns on as a to assets. program way generate the to is it

look growth sell the you into the it’s effective as opportunity attract put it. real on retail at actually more money is very asset, time if length So, retail the and we and into well that where asset we have it this a as when the from sales make more the buyers outlet over

over the year we this capabilities. Additionally out, or support two, built prudence with have though, back we strong last office as

the for very that ourselves, the it, of both in relationship Lyft we very want a light fleet support possible, We Overall, manage units and given have if out with the where drivers And XX to From getting, deal and they Uber good a have into prudently, returns even great age we the have and of and vehicles this our the you fleet, natural it price a use growth on been maintenance. providers. as – we’re a out where flow from we increased make flow it’s of the both there. sales out get effective key solid program. perspective, the because think this we we

cars some be to buy growth. value, to prudent we’re on into able further but are the provide fleet going some this and We

good. Very Okay. Kathy. Thanks,

you. Thank

Tamberrino next question in with go ahead. Goldman Our queue Sachs. David come will from Please

Great. Thanks our for taking questions here.

be you the are result cash cash for the throughout in still of Jamere, remainder looks for fleet company year believe you a had do quarter lot How track the of to outflow that. a and bit that XXXX? of flow and growth as free little First is position a a to like expecting of negative first one going a you the

Yes.

on as comment timing first well just drive really marks, which fleet incentives quarter. a in can volatility buys the quarter, from as let quarter, rebates the or on the make quarter to ABS So, and drove usage the me

as We said over about And you throughout up the I’ll TNC say operational fleet. RAC What million. it as listen cash expect up before, I X%, our this $XXX we year. X% as we’re where capacity was normalize the to was flow smooth the growth out move with that we the fleet of saw and but U.S. results, pleased to ex

and about the that’s been there Kathy’s us from It is there. So, helping drive us. in growth that fleet the the you discipline managing primarily fleet actually comments heard we being for see disciplined managing growth is TNC is to a driven driver and We’ve that yield.

about year, think the for I free didn’t set and As flow our takes. We for to expectations right cash are there expectations. want puts the

need we’re On in that the interest the we But investing from we’ll have positive will That improving. initiatives. our operating sort to is seeing have drag be if swing our cash flow. the performance we residual rates then cash. strong, than of factor that more on we’re needs mutes market could performance use did the get gets to heavy values. corporate corporate cash anticipated, and obviously, less market And say If anticipating positive front, more year finance tech our a of is We and the cash we’d fleet a the there. free

puts So, we on there could negative, for year residual expectations planning but the clearly swing came around positive. us some based our values into the takes that and are

can just you you’re now how Okay. standpoint, going their without growth? are you about for size very forward? kind they capacity Kathy, grow And captive and you helpful. for interesting, ride-hailing fleet the partners how responded an then or and thinking of somewhat That’s TNC to to your But – you drivers from operating that

drivers think driver a wouldn’t their of strong find are I provide we captive, do I network flow and highly satisfied. into we really cars say the but

evolved, volume are people of for business. increased get scores for appreciate built retail they with used them. out outlets have. leased them without ago but working time it’s outlay partnership rolling say way car. We’ve business. of know, It’s a NPS for would to been multiple I partnership. given that car working a and more making the a well think more and effective finding We’re driving with know better, don’t month into our or They’ve one business their I you the actually of on dollars our a almost driving financial obviously, – has it I they’re And commitment of we been revenue thousands the similar to think great to a years captive, growth we’ve I three we even really and this, as stronger a

for a win. So it’s us,

For them, it’s a win.

a to there’s there provide helping that have lot and they they I with can hope them but know out think on the more constraints, drivers, to demand work drivers volume. they that. attract obviously, on I deal we’re of

this you season Understood. are so sorry do it. I’m in if you last Got in the opening comments, how up? but addressed the how booking near-term one, April see In trends shaping far? the the And peak

what it’s the done leveraged Endgame, been fleets, us. Well, great just of season, there the with year. from if holds and of been capabilities, for has are look important our very we great we really at April, that we’ve a really And efforts what our of marketing, things which the and is, capabilities, which A and summer you time the lot management marketing, is pleased impact sustained. are the marketing out the pricing we’ve our seeing better is, obviously for March all the the revenue volume the peak promise powerful most Avengers:

strong I same and And together very growth for the for think a the we March, has indication if saw steady that if look at great you us. quarter-after-quarter, April. flow, we it volume, a and see put we it really price summer with and

line in our Easter break a the point bellwethers to tend to peak season. and for said, with spring spring summer peak healthy as generally were and strong be and and Kathy break Easter expectations Internally, and

consumer’s suggest relatively summer. our some other of the early from the reads also is that think healthy the previous that the I summer into heading suggest partners thing the data airline and macro also the

for So, should all this of business. our well bode

it our leadership operating, team a in came got with getting to cars that strong the add All of strong there leader really And out customers, NPS in strengthen. past the we years over our great really two is the that’s place. capabilities have we’ve and a of front Walmart I to rocking out employees. and built the We’ve continues to operations think in it, really

perspective at that difference. We’re Power game a of J.D. makes top and the the from a

brand, So sustain all and nicely leadership together, they’re into team are place our these this, how between the things working quarter-after-quarter, month-after-month. and all coming

Thank Understood. very much questions. you our for answering

you. Thank

question next ahead. Our with Consumer Derek Edge come from Please will go Research. Glynn

questions. U.S. of Good morning. or drag impact and benefit taking in Thanks for quarter? that much core pricing What the did pricing? mileage a was the TNC to the business on have time How

Yes.

that business, TNC making But mix our So, U.S. solid just what T&M. drag it’s a the one-point is a in from progress pricing on on really I’ll standpoint, say business. about we’re

of cars a RPD business, more cost have because that that The to fact with part us discretely TNC, for partners our in associated the want we and associated lower put business. The lower, really need. fact RPD, been you that well the the demand that single-digit increase It’s little you associated keep about RPD model are – see So, is a providing for as – at then in at just that than in business, our that a it. great been we of of understand if car and of older these on good fleet to a look take a of if makeup bit a business you helper the look TNC partners in drag the the that we lower-cost we’ve a business with them. the got that profitability mid length our really as with that of has is help reflection business big a actually and what so work

So, business growth us we’re our piece and business, pleased also well. very there profitable but it’s been as been for a a our with of it’s results driver for

attaching it. those products very vehicle are insurance to what dispositions And to the and Got any finance seeing, then the if sales? to any helpful. That’s you impact respect retail you’re from channel, with

been So, the sales F&I have strong.

Our team is there. class world

We around great F&I. have sure that we discipline making drive

normal you would retail business. So, we treat this a car like treat used

those disposition as So, those actual of and the as things the targets teams have car. revenues driving we hard around the drive we’re

I’m capabilities. that we’ll and to So, world-class team pleased the well. forward, look strong going to a area we’ve continue And as with world-class with drive results results got there in

Yes.

If business, have XX the look you we that in we distribution size it’s retail growing. and have at lot the that

now anybody power values. used manage though the also car have think and the were into pretty taking seeing of advantage as as is going that we’ve benefits of market, In we’re a we these as hot well And to with turn the long-term obviously, this margin. we – manage this and assets can residual the operating better I then And of right way, as in we’ve XX XX% this that well downturn, that it, cars, hopefully, things if we’re we’re phenomenal. to are which good other core through and – in We is sustaining we’re network to asset use top downturns now the peaks same reaped dealers of set profitable way. buying do that well dealt by capabilities really as

Thanks commentary. all it. Got for the

next Research in Associates. Millman Michael go The will Please Thank queue Millman you. from with question ahead. come

Thank you.

what be that guess a what normalized catch-up I catch-up? looking cost what well? on is and last, is in is the terms that call year? EBITDA I’d Just the in should following a expectation up have will for continuing technology complete as I’m timing operations of – will that and break the on have – the depreciation what on you for once unit Secondly, guess U.S. technology catch-up impact what’s out; I could the its what from your for depreciation

Yes.

see into residuals in in came of the we single-digit XXXX. depreciation, the some expecting on and So a year low clients range to

been it bit consistent the little is a on as that strong. think factors, execution and reality depreciation retail The strong. nuanced been three of had absolute the variety have the year, depends with this a four dispositions on first external et cetera. We’ll I values conditions, market months was say rates more number has is our We’ve residual forecast. that favorable or execution that in our than through

through So, to for But a we I it we point that, relates to things. couple favorability I’ll the as our forecast have year. changed And will you the haven’t quarter or say first thing so, some that. do is the of on technology spend, the then

adjusted terms on to associated year the we generating the our we outside of $XX be that to are of productivity adjusted have and spend. that $XX also corporate and we the corporate the those But in $XXX have million line this are actually million going impact that would said million. said we’re range we off. EBITDA, to going technology to impact in below $XX somewhere It’s things offset probably EBITDA, of And some impact. First, with between roll million then the

So, adjusted with we’re year improve that through technology essentially technology actually that and the EBTDA to going self-fund is year, next this off the half corporate spend that flow those P&L, of approaching as to numbers productivity our to And roll spend back we’re next way start improvements productivity starts the that improvements. the year. then see you’ll

what equal, should EBITDA being else be? your everything So

to top-line things. on lot in see a we Most terms of I Well, growth. mean, it of notably expect will depend what

faster-growing standpoint, of long-term a higher what is sort business. If business you’re said at positioning a looking be we’re ourselves our to we’ve margin from

going and productivity expect with time. to same at line fair our in top-line, We share grow of the and we’re drive get the market market to our growth the

of reason be what back a the margin on we’re as all faster-growing that lot technology no be focused at of and able why are the XXXX. efforts do us is higher can’t structurally internally half exit given that we we’ll of confidence That’s our to transformation So, business. there we a

corporate large considering a profitable we with brands, hailing together this solid can’t is iconic retail margin. relieving profitability I’ll reason a a XX have no the considering fleet growing management a top and considering business, [ph]and in just competitive the employees we we used best find then outlet have world, this why company, ride put partnership, we car in and/or there be have

to number on Would you put care a that?

we don’t. No,

give I’m me but give get to to try think You far it. as to can that’s – going I as to guys guidance,

job. our That’s

Yes.

under her kicking be table. I’d guidance; the gave She

right. That’s

you. Thank

Next ahead. from JPMorgan. Thank [Operator Abebe Please is go you. Instructions] question with Yilma

Two questions me. from Okay. Thank you.

on for sharing perhaps, you terms ride on ride-sharing Firstly, seeing you the business? side are of of the business? providers your competitive the of competition of that core sort What talked comment in you’re but business, and side with what about you doing can

when it see, sure again. you I’m – say, ride could have you saying you are I try think I We the questions not if right quite

Yes.

So you the as your business? of core are terms ride-sharing your what in landscape competition from terms in competitive seeing of

Okay.

So is you business… it much of into our how eating mean, it, core

Exactly.

And when it very say, it back hit I the our would was coming started ago, first single-digit erosion probably years short-term it past, out, them, of mid-to-high which longer business. in great generally around, frankly rentals, fueling erosion of we that length us, that keep, about turning that aren’t an saw probably cleaning end much. them, that the better. for between the speaking To

leveraging with how the If growing, we’ve you look these think at cars. guys and for the fleet opportunity size profitable by made now than it our business and need of it okay, I saying, up that’s more replaced

in only put it miles, into place or XX,XXX the and XX,XXX, a on residual year car a We’re let’s the ride-hailing values is two when not old business. best

values that last manage growth the and have. demands we way created such the with a significant residual curve – as and very win-win two the over in we partners well pretty manage which Let’s on it have years profitably. leverage let’s those effectively situation we a profitable, it’s we’ve And as which

growth I us. driver Yes. mean a it’s for

what the seen of would rental customers rental sort seen few a haven’t in I typically the competitive our for shorter in change from or standpoint And You’ve alternatives use core say trends in we when so. results car a last or to roughly here really trips as is, significantly miles. are it quarters where average taxis transaction XXX hiring and right the subways urban And five days is case any environment.

the ride-hailing market we’re driver into of And and has and us core we’ve portion business so turned forward. to growth dedicating will pretty a with up our outlook pleased business if held well very you fleet the for our going the a by

our the sizable What’s I the in And rental at GE largest world. us keep our fleet management now bring essence been that business fleet to fleets opportunity large been corporate actually nice business these a business That managing business, manages five profitable We’ve in is that to corporate with in together in spent for global. business. years mind, business leverage Lyft. Chicago, we large which and with have a corporate Uber managing fleets also was and and able corporate

for capabilities connected taking as we’re developed fleets these over them corporate the ourselves So have and and apply to into maintenance that very capabilities well. we rental years for starting fleets sophisticated

getting apply from some the in the learnings So, will able we future. of that to we’re out be think,

any managing get do do than of autonomy, in competency has nobody general. things I and fleet into more you we large these a believe If

a these goodness where So we’re overall. and lot that there’s seeing of partnerships

you. sense this Did pricing business is have overall industry the time this That’s affecting your at a point? a or whether in in Thank ride-sharing overall point you maybe how in good color.

try drivers No, ratchet money. can mean so a bit I it little to they’ve make if it their up anything, had

attract to So going retain there and very continue tipping. low is added surge They’ve but out in pricing. order cost, to they’ve the in drivers,

of what sometimes, found rides. and with related a So space cost deals would productive rental then companies of surge are our us if some say has I the – very type effective in anything, is taking from more are expensive perspective there

is sticking versus pricing if think, I So the sticking down. up as anything

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Yes.

year better I operationally think get we perspective, going given this lower – much a expense. better pricing – we continue to cost to better when get depreciation into a with much from from continue perspective,

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our ahead. Guggenheim queue go And Porter will question that you. Securities. next come Please in Trent Thank from with

you. thank Hi,

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AT&T conclude conference for very your Teleconference. you for call does participation using do gentlemen, your much. and Executive today. Ladies for that thank We and Thank you

now disconnect. may You