Hertz Global (HTZ) 26 Oct 232023 Q3 Earnings call transcript

Welcome to the Hertz Global Holdings Third Quarter 2023 Earnings Call. [Operator Instructions] Following management's commentary, we will conduct a question-and-answer session. [Operator Instructions] I would like to remind you that this morning call is being recorded by the company. I would now like to turn the call over to your host, Johann Rawlinson, Vice President of Investor Relations. Please go ahead.

Good morning, everyone, and thank you for joining us. have press should financial and you information. now, our release earnings associated By slides conference of accompany can also to We've provided our through Investor be the call, Relations website. section our accessed these and

provide find call quarter certain this statements you our approach intended transparency a Our contain I more hope want slides and you represent detail We that this forward-looking useful. and information. made new are on to them results. remind on to

by relayed their a uncertainties. as not statements circumstances. call the and no to and to differ of Forward-looking company speaks date, are guarantee inherent changed obligation nature, performance, update Actual materially. are subject Any on only may information results that today's reflect undertakes forward-looking of information this to

is are information XXXX with allowing our evaluation certain and believe in with concerning XX-Q Additional we'll business. of measures, noted, our earnings and Statements otherwise the which statements use focuses of quarter our these profitability today We our on information Hertz presentation provide earnings available the and operations global reconciled website. Today, the in These non-GAAP the on Form are section these website. our third Form section release GAAP XXXX numbers our Forward-Looking available Relations of measures that and performance. Unless Factors non-GAAP on about press financial Risk our documents Investor release filed SEC. and additional press in XX-K earnings our better our discussion contained

Chief Financial call turn Executive have Scherr, Chief our and this over Officer; Alex the we call Brooks, now morning, Stephen the to Stephen. On Officer. I'll our

Justin earnings appointment joining now, for you our likely as Operating November new By thank call. Chief of our announcement XXth. effective you've on Officer, and our third seen morning, quarter the Keppy Good

where both military. Corporation, multibillion-dollar and strong with a leader private Carrier division. from the U.S. experience a he in led He's us sector joins Justin the

to forward I him he Harvard Point of closely leads Business as School, execution Justin the look graduate and West of a day-to-day working is and with business. our

for strong in $X.X to revenue turn last consumer. Of Volume, measured highest X% and were our up strong, With of traveling business that, with sequential history. with Revenue quarterly was results was of X% by year-over-year will ago XX%. XXXX. rideshare quarter volumes corporate strength XX% XX% growth against now the was quarter our year company's the up sequentially. X and third Demand improved and continued levels XX% leisure, across grew sequentially. the sequentially, year-over-year as year-over-year, quarter. note, Revenue in up demonstrating up volume I the in Pricing all versus versus the billion, year transaction in but representing reported days the rideshare our the of was QX elevated down

the industry, an of just amidst move from quarter factors expectations sequential pricing While those more X% historically all experienced up perspective, the trailed stable competitors. relatively rates fleets and major focus. market stable believe support with inflationary elevated over that ROA industry shares We appeared in tighter various versus to continue will our our our the consistent in among

the In on from October, As increasing cars will which is are and North what is travel Europe, strong, maintain that we still as inbound we ongoing is of strength through drivers economics renting believe from attractive as year-over-year America move in well leisure to moderate across we here. rideshare Hertz. remain leisure growing showing declines bookings all,

in speak help being to large higher, to rate which on in more focus reconcile make is point as let also channels me nature. our while insurance are rate in X%, contractual business like and I like additional channels dynamic the are market a segments our of where leisure, or on up rideshare customer up There subject are RPD pricing. business replacement pricing, to Given one were There will more fixed moment.

focusing pricing excluding RPD American businesses the in more RPD of transaction EVs. our leisure dilutive North and North impact more that flat in largest quarter, number the X%. days, business, channel over by was By system-wide the in lower than our X% comparison, prior roughly sequentially on plus fixed the therefore, and drove Just was rate America up to

the reflect cost on me the Let of side equation.

QX Our reflecting adjusted million, margin. corporate $XXX EBITDA was a XX% in

industry trailed environment across While company. still reflected operating higher fundamentals a RPD, strong our expectations, performance this the and our trend demand, sequential improving stable

Our very The particularly categories targeted those the they are addressing most achieved quarter vehicle as a way. EVs, we on a productivity in our with basis, direct operating gains in remained controlled DOE. which our exception remained of unit across expenses grew transaction costs, volume. On damage we

both focus Excluding XX% transaction DOE net and base. down and per costs coming damage day in our expense our continued on our collision is consistent which into year-over-year, with periods, reflects was global goals XXXX

and beginning significant digital investment inventory from and confident tools vehicle work resulting are our productivity, benefit our check-in, SG&A. We including our to technology trajectory. contain We to telematics in field and remain from in

of talent expectations talk of considerable on understand migration weighed our and want issues operate our we Hertz how QX to premium context must better the rideshare and the vehicle of in our factors fleet, the and and we Nevertheless, value underperformed strategies. in systems I relative our our each We to about to provide offering. that the cloud, control improvement made in have customer additional addition results. these progress technology, our improving brands on of better electric to briefly investment brand, quarter, To our our and correct in

was This in Let me begin spot Hertz. the a bright quarter. with

been brand our for brand. Hertz hard loyalty we premium to As you business increase recurring working and know, have

book delivery, the building aspects to the experience from the across digital through improve of to and partnerships We shop driving customer attractive are financially travel addition initiatives rental industry. our assets in

price as earlier, all customer car that for even elasticity. To confident brand financial This quarter. including outcomes referenced realize in and some in channels of the through class, Hertz markets better pricing. point, see to the where product particularly that is other strengthen we demonstrate for very and and to initiatives led the We are a leverage, strategy pricing brand these yield the company, this purposeful type pricing better markets in by the leisure opportunity identify specific the brand, I

our insurance to continued We revenues brand. replacement QX also corporate under business grow and in the Hertz

As I noted, channels headline knowingly dilutive rates to are RPD. for these customer

However, given are business for longer and of total on length they lower better our cost, replacement and intra-week mix. important utilization therefore, to corporate insurance each keep

our to next Thrifty. and value Dollar Turning brands,

Here strategy. results validate our

to to discount relative see enjoyed premium While we've we continued several leisure in have channel, key in a value a brands. Hertz pricing the competitors our

to reinvigorate to this. strategy Thrifty fix aims Our Dollar

during the system, aggressively deliver value-oriented customers digital throughout We to channels, on our not advanced upgrades. These evidence digital sufficiently facilitate in improved work at to yield revenue and service products book gap. offering summer sought check-in, expected saw across to the value-added our agents field to Hertz. the services experience by of us were help we XXXX shop including develop results unit at ready to customer to assign close and cars the are Enhancements with that

rate brands sequential pricing and mature, only for Dollar our initiatives parity to be We in closer as positioned will believe established with our to X%. As up value Thrifty more was market. move better the increase Dollar

improve rental back cost We lower this on to channel of also less of and expect margins delivery expensive the for vehicles.

rate financial will improvement us to that worth the Finally, even it which improve customer alone up enables to experience take share is out absent gain performance. pointing

now me which to and turn business Let our strategy, are EV rideshare complementary.

mandate New proving working for is build year-over-year including to revenue markets are of be specifically new which Our electric adopt fuel best-in-class cities up just business and drivers EVs well and it offering. urban The point entry as an are licenses from making open incentives positioned City, Rising in Hertz XX%. EVs growing mobility channel rideshare York further to vehicles companies creating source where for that an to is and continue shared like of affordable a prices electrification. attractive recently mobility and their a use. for rideshare the opportunity that is us is those mobility with to volume announced business companies we expansion customer and available drivers more available for as deployment

recent moderate took damage drivers, incidents rideshare Our is and the re-underwrite as higher reassuring moving rideshare With of by to hindsight, utilization. slowing growth of with This into EV supply we in progress purposely rideshare XXXX base. occasion and our into driver steps ongoing earlier EVs fleeted left EVs. over the vehicles electric the their and leisure more rideshare meant this to facilitate channel leisure among

lower As electric RPD result, RPD performance drop, contributed in our the company the to the quarter. for in leisure a which vehicles for

enhanced on better of you in been during the expect, more in to have is to rideshare, underwrite parsing existing by damage higher length we experienced quality buffeted demand to the and of of This and remediating the As growing we of enabling to the our level confidently confident allocated are business. causals. And keep to more would drivers strategy us that processes fleet return the is improve QX, data mix actively of drivers. a this electric

current Over made the the rideshare increasing months. just on expect vehicles EV to in our thousand several electric several next several move supplementing of the quarters, number into an fleet, we the last rents

that simultaneously As pressured EV seeking we supply to in to fleet that leisure, more tightening accurately we cars reverse the channel the are demand from the the in thought take matching issue pull steps EV these effect issue mentality. broadly, damage continuing the to adhering we to had more ROA costs elevated they than would come quickly down have. and quarter which our We're also to of rectify and

share a the context bit equation. on more damage Let me

lower vehicles weigh impacted higher on to damage electric maintenance conventional while First, vehicles and our ICE results collision comparable in EVs to and QX, repairs negatively continue on EBITDA. on relative remained

about context, an run collision vehicle. EV with on combustion damage associated and often a that engine For comparable can repairs twice

portions difference larger declines as primarily value course last that Tesla compared of a market must producing of fair contrast, creates resulting such The of year fleet last crystallize year, EVs our a XXXX, that exceeded EVs carrying between our by car. have market carrying to value values, loss in driven in once market is driven value lower in salvage, therefore, and, at car the where values MSRP Second, greater any our burden. By and over the we gains. salvages of some salvage the

a is, of as therefore this a a effect thought results. phenomenon should not effect negative it had While be in and of VIN-specific QX, on permanent course,

aspects the can particular on and like reimbursement. these damage Given incidents, procurement impact, we collision headwinds, with readily actioning parts more we urgency with focus and are

We're on a easy-to-use educational end-to-end but working functionality with from underwriting performance. additional vehicle to We outcomes have importantly, improve are we activated most developing based EV perhaps OEMs on program to damage comprehensive collections. relevant tools also the

collision to that points margin challenge believe levers estimate we in option including the similarly This electric RPU we had in in long-term and reflects me merely try ICE We remain depreciation, a of several stability vehicles. sized Let nonetheless to put early been autonomous been the strategy those to with comprised We uniquely to from electrify have charging, of all on the in committed fleet is growing account we down. EV relating vehicles end, fast our some partnerships fleet. issue. rideshare, the the mover, not would are impact margin higher. frames QX and our fleet, our our Taking channel the opened solely around EBITDA damage access We and dimension electrification electrification positioned. as on but management to door value players incremental interest to where of our requirement, were other it presence that bring where an to our underlying benefit vehicles of our are as controllable cost first-mover. Electric much our To a open business. in approaching to being with fleet in a to pulling an

we differentiating. is repair deliver pace demand charging, more competitive we key this to in and confidently. the generation, these is By expect demand manifesting an to mistake, of capabilities clear demand, fleet There's here of sticky. not we easy, are to gaining developing world and grow tandem. a manage corporate no as learned EV levers including manage knowledge their ownership Transitions rental we production value different profitable The there are positioning rental and maintenance objectives. magnitude the and and the electrification. EV a EV factors, as are rental toward the that and important own to aftermarket engagement government simply seek infrastructure, how gaining a And which early understanding not cadence fulfillment also of believe are a is customers needed to that and of cannot sustainability fleet growth of as are moving overnight case in quickly Early management. Make are fleet And control. OEM grows, satisfy is rental is EV profitable charging ramp finally, of and efficiently the the fleet, we on to EV Hertz

we did. new an Nonetheless, EV possible as vehicle there's transformation or can growing objective stronger gas-powered evidence preferences. remedy we of higher for EVs than pace at electric and We will will for begun whether choice And ourselves be ICE electric can. current in travel prior slower trends underway. challenges and that collision but the of converge. In is journey that, hand be not share makes their we expectations, of which studies sales that and lower are undeniable are we the in-fleeting and widest best The damage experiencing. so the accordingly believe our working than with ownership when we'll will vehicles, incidence having offer our and models, they We We way want the is an know sum, needs these the expectation straightforward. customers vehicle of our to suits that of our U.S. to

past begin to where and the forward. XXXX the field on we close and transitional foundational mature. XXXX remarks contribute performance continue technology continuing a we has cost to basic focus results QX, business our that year will a the they want into XXXX, the offerings as our our and I few expectation and they about with Looking to for comments on an with the fix expectations through execute to of strengthening. In to company, to elements and brand initiatives capability my improve our become from throughout product financial year on revenue will in

an Carvana As lines, IT, present our the in noted our operational improved from on investment improved operational and through through to continue accompanying our fixed as sales eye to costs partnership expenses improve global on in finally, brands, of Dollar rationalize cost harvesting the we initiatives vehicle Improving Thrifty, growing efficiency and and productivity the initial focus Europe, on reduced increase footprint. Expanding businesses. on our management, engagements material, a with include and and business I retail with of to our Learning and similar with namely to reduce operations improved where EVs our revenue as newer other results our before business. to standing whole the competitiveness have we Page outlets. established our both XX terms of And well profile close gap and of more all to across business. projects our our margin to our elevate Continuing the enable the including leverage, our both and value rideshare business the pricing meaningful competitors. as basis margin

our initiatives $XXX enhance Taken EBITDA represent incremental of to together, add range the financial these in performance at materially an in million maturity. and opportunity

set ahead opportunity the We us seat. the we provide more improve In We our believe believe Day company greater new continue look forward withstand around also to render financial the opportunity initiatives a course COO host is for business to in all, these with macro achievable. take to of to Investor pressures. the are will to I durable to to a expected ahead their quarters initiatives an detail and significant the that contribution. business and the setting

work been the these of end, on has on execute. mention. invested. in the capital That much not of the said, measured and their the course, delivery is we mere initiatives be Of to and will has begun It

now results. turn detail our Alex me more to Let on for quarterly

you, good everyone. and Stephen, morning, Thank

and in versus demonstrated As the X year-over-year To this the color growth XX% you Americas segment. International on year sequentially. segment XX% of reflected $X.X of and segments, billion our X% we've noted, in increases revenue ago X% give of

substantially in up both in in up as sequentially. segments international. as X% also Pricing and was Americas grew sequentially, well year-over-year Volume X% the

International Although strong as down year-over-year, QX rates to X% in Americas in XXXX. and X% exceptionally compared in

to per was average global fleet monthly our up size sequentially. XX%, contributing Our revenue the high and X% global vehicles fleet XXX,XXX quarter of of for at utilization unit $X,XXX remained

XX%, strength and in the the international. basis XXX month in call. XXX XX%, in our in points basis up sequentially. utilization on points utilization year-over-year reflecting per XXX year-over-year Americas RPU the Strong Americas continued points QX was basis sequentially, in and guided was QX International healthy basis was up within depreciation XXX of points utilization resulted $XXX $X,XXX in Net per unit in demand. $X,XXX last range QX up and

the note As Stephen is was our I last XX%. at QX, call. noted, for would a $XXX adjusted that $XXX the million corporate EBITDA provided outlook of million margin within in quarter SG&A on

continue reflect cost DOE earlier, initiatives. to various transaction discipline damage, noted productivity by As and collision mitigated elevated and day per

damage we driven year-over-year per facilities. fleet-related and transaction noted, by decreased for periods, costs QX, fuel collision day As DOE by costs transportation, XX% excluding to personnel efforts and and our productivity maintenance, improve approximately like reduce in both net field largely

Turning With net September X.Xx, corporate of billion, which our $X.X was was At the above the approximately sheet, balance QX $XXX target leverage million was billion. to quarter XXth, our respect modestly of capital liquidity liquidity. for Net debt structure and corporate includes end $X.X available at of to our cash. unrestricted our X.Xx.

with mature the we asset-backed the interest XXXX fixed of During notes of rate rate in mature $X these car quarter, approximately billion million X.X%. ABS XXXX. of notes combined and issued $XXX under a U.S. $XXX average million facility in rental

mitigate the At $X.X rate we rate, ABS was XX% impact U.S. our and X% caps March We environment. of approximately rising of portfolio debt also of The rate our and vehicle which ABS a the upside remains to approximately facility under the as European capacity million. with an XXXX, maturity facility. extended the had carries XX, billion our rate blended globally, along EUR XXX at under on fixed ABS required to serves September in

in at quarter cushion equity end. ABS sufficient maintained our also We

on environment interest disciplined including corporate risk potential costs will to debt Overall, maturities vehicles, we fleet be no on XXXX. a well. ladder believe continue fleet will debt and higher with maintain material as input maturity of the rate said, broader until well-structured That size remain expense, to with for higher the continue we disciplined

capital flow allocation. and cash our to Turning

million For seasonal was of operating CapEx the flow CapEx an in back came third cash million. of of quarter, fleet cash Adjusted was start as the free with our flow $XXX Non-fleet $XXX inflow million, adjusted de-fleeting. $XXX the million. $XX at on

stock, $XXX of to Lastly, repurchased in $XX repurchases bringing quarter, common we year-to-date the our million million.

let Finally, our forward-looking color some me give expectations. around

revenue seasonality as QX, in both to in to reflected historical anticipate line Looking we days. and with move our RPD transaction

depreciation and market adjust expect off $XXX We of values, to to key and accordingly variability the to $XXX cause which plans per by which unit range and net end fleet be to year. the of volatility fall through could alter growth to a may and us residual depreciation the occasioned within with our

the closing, headwinds, there premium brands technology of to me In relates it business, core brand. end let is reached and our the cash strength we and through EV of work optimize value expenditure Hertz especially reiterate opportunity to continue our substantial the to grow margins We as elevated our upside RAC and as the believe operations. flows European

We the meaningfully continue and to to both bottom to lines. expect top growth initiatives our contribute

With that, Q&A. call let's for open the

comes Woronka [Operator from first Instructions] with Deutsche Our Bank. question Chris

but guess, you -- several margin been, I quarter normalize points you think said your I the ICE Stephen, several that all basis vehicles, hundred basis for points if would the have around it higher. business for was your XX%,

improve there? only would the guess of I accretive buy of EVs right? EVs thought margin, over do improving do are the comment you I economics EVs is you're the are if And But of would would make time? why I kind to But the I the be that that I it you of EV mean -- just margin mean So you suggesting you time. guess, come need will over economics assume to question true? is, get composition there how that what

Thanks question, Sure. Chris. for the

right. You're

hundred regimen the EVs, returns and was if have cost sort are say put challenges margin reported several remember, to I Our ensuring I EVs the boundary escapes that the higher. subjecting basis asset would as associated on of forward in. bring ROA would it analysis referenced, that points of any this any been with and XX%. of the positive several sort of asset you margin, higher, points around we none an in And

underwrote were And that we now. around margin potential than these priced the we equally recall materially where when are EVs, first higher right

fleet, about the depreciation. are was in on there adequate margin And embedded. One portfolio basically drop of and so by depreciation, very a X/X eroded has lowered cars. that these the residual of What the to that on the Obviously, was margin which be standing MSRP is X elevated current things. occasioned

and damage and salvage. around working question is a This of issue we solvable second both now. are is one The incidence damage of It's right and a on that cost.

In business. that to incidents, putting we're hard the are in cars, these context drivers into to rideshare we our particularly of working re-underwrite the

our down. So happen. ICE negotiating costing the we're than doing is we're and We happen around going price. mentioned, drivers, that going expenses is to cost of for the of of One, aftermarket, keep, length discounts, more to longer I are incidence in for things repair the in on waiting parts equally, ourselves us to a EVs procurement market going assumption looking damage proliferation conventional way, simply come about damage is parts not these that to are ourselves where meaning then And of down. goes bringing twice repair down right experienced our supply now, vehicle. Two damage and steeper But cost, here. of are proliferation at as grow the terms come

moving. So down, by damage addition is both where taking market in currently to to going are and salvage is we come the actions

relative by move generating through to depreciation, natural to in we RPU remarks, as business, The And back expressed Uber Lyft my rideshare in And unit among first them have of so re-underwrite feed that's that the a going the cars. and equally, being on the and we up. RPU, that's effects. what One, third being a third will these are going to tighten see come I now said to second drivers. is premium the it's per demand being it's demand quite revenue in confident supply going our move way to to back salvage, being went into We're exists, natural that piece, and prepared damaged higher X cars pricing we the -- leisure.

margin course, the Of of relate portfolio. those remediation current of on all observations to the

to the is second question your Ford. way think the on answer I

New buys here prices. going at are to come lower

We are better buyers at lower prices.

and depreciation margin as margins ICE are that when the us take Now thing speak problems seeing both demand cost said, now and component, as remain we've ourselves solved fleet the fix initiatives. The recognizing cars, will And now think of points that need as around in first-mover, cost in and it's I pricing a your being a Hertz to on being are on of inherent say, that range. existing that I market fleet like. look how out work core RPU strength several learnings we'll brand that a to these I or compelling us. Dollar demand resolve basis thing taken is for of can the to closing I'll we're note equally, important mover, value of as we But business? the pace just and that reflects or to I ensure us the what to looks last being it is these EV one to a But hundred that's extent is equally I does we improve reflective salvage the several the it and watch the front around strong and as first around are solved Thrifty. strategy still is strategies will I buying and make think that product. at our and you that boundary relatively $XX,XXX being the we think remain of damage baseline higher, fixed. And equally the to committed, our Obviously tell was question put said, are or developing There and to $XX,XXX only it notion the before. points here you and extended issue the some or of know of there, And you,

helpful. super Super,

and imperfect follow-up a little as probably bit an is So question a and theoretical. this realizing

As out you've sideways we that and of hey, of said, we macro next year year, mean, volume flat it flat look some going and initiatives you're this about to talked lot you're of if on, went just I of lot to working a a because took RPD. I have things that the and guess

in I'm get and 'XX? add What -- does how of up -- to trying can 'XX top not impacted what Is there can much that range but -- actually these realistic a of the offset it of you a in for small very a what in outcomes. EBITDA level to things potentially would terms a initiatives if what some sense -- rolling get you of you year some to quantify next take that growth had do of you're Again, necessarily still line out? super question, that Can

say Well, And and to us, that don't right both think sits a on question mean the and theoretical a it's side. it's question. it's would revenue minded the execute I I we are expense of to Sure. it. I front in

On better the to not Dollar of price The out product as rideshare static ability the not and to a I to book side, price product on words, brand, start incremental take is financially waiting just Dollar on Dollar growth The us. improve other we no the ability relatively flat up coming grab, and volume. strength share of such there's the exercise as offering demand assume by benefit we're in assumed let's accretive a In strong a leverage revenue build that back see the better waiting it take us. people to on of mentioned, share a to business. And from greater we're that side, to and is pickup. build continue on not our to in

in because certain On the to to the growth, continue time, to grow cities this going become continue And think we this in is year. where, rideshare move extraordinary see since fact, requirement. only a side, going we XX% deadlines closer with growth is to of to I the beginning

On let per let's not DOE on XX% the cost DOE. progress being that's side, mask going made a work of year-over-year. transaction on. not the day basis, down the That's per EV basis day on again, was end

issue come take to operate going on the of for look bore around And like. to meaningful relates improve of new to we and our equally, EV drive and continue and ability And cost costs the efficiency. context going will efficiency taking out this as that COO to because business down with this the our full we're to reduction is in damage technology collision, in

opportunities And is It's work so a working in us as And your not growth are expense market, And right theoretical. front revenue the side, based not and on again, product. there down. again, there on. we're against take entirely a that's of are characterize, revenue a that on up you price reliant better now it's task in it's take on question opportunities to to flat days, leveraging

[Operator Instructions] Oppenheimer. Zaffino comes Ian Our next question with from

I Tesla to and or question call maybe the the it, versus really a on follow just about how was dilution whatever you you main to that question to want non-Tesla. previous maybe question. talk I EVs then of is wanted specifically, on guess, previous related up from Can much

various if diversification? margin fleet a So normalizes you just get from as the throughout and kind that of normalize you will EVs, naturally uplift

kind and market side, follow maybe maybe shares environment, think the to the not pricing, then, about of relatively were main pricing said thinking guess up try of I overall? willingness the just stable. you guess take your we're you talk kind you what Can the lead when on of And they're I to question price generally I competitors was

sure. Yes, Sure.

total is about of fleet, Teslas that. that and on XX% first, represent question, recognize about fleet of the the the total EV EV So XX%

of relates so as cost the bit a others. there's the opposed And quite Teslas that element to to

our risk work to so so and damage Tesla labor and on with look lower car, them And focus very and and our procurement the direct like. the we're in to as the performance of engagement of of with incidence at parts is the

our the of example, the we appreciably forward So than I more Tesla. bought an which again, to EVs XX% that lower extent as time, we buying we'll be GM take would working. of the that's all at vehicles, over where say fleet, is electric an price point on

Remember, of the that's lower lower of you parts will cars a that GM of in damage. of more decades mature, likes will an to of think But the broad obviously, parts context there, that cost I So there's There's are there benefit. And other a that aftermarket those and of speak OEMs, and speak labor. to perhaps national likely think part of network. is less Tesla. supply that in of a establishment incidence obviously is importantly, elements I

the suspect happening own improve by equally and don't I as see both diversify. But so incident the this reduce improvement improve our say as cost issue that just to and implied that will your that's on on will we we which question, way margins And to in we to look not workflow this. incur

fix to and So doing we're it. I what think cost work there's there's but think reduction, is, I in progression We of it it of a front us. understand natural

Hertz way and sort Look, On the we the of now. years, of we're as which a your second played price, drove end for volume find known meaning that to that volume, is inverse many to around higher a part low the that pricing. mean basis. on undeniably of It was price down to behaves. produce the revenue dramatically played brand as brand Hertz changing I many, in question

and We remember, the said, way we decile We at we in remarks, markets, clip price. bringing broke price elasticity. And I the price we a that to to taken do have think I were that look EBITDA rent about saw We but publicly them. JPMorgan prepared sets at way quite in conference we not And in was it orchestrating find for runs cars, of example, at volume that summer, we the into price look demonstrate to a deciles. markets, said in XX% particular in And then customer my Hertz. the price the look of I that to down, brands at at we lower increase line. very we as and of sort up. Hertz look And on as willing disassembled little where were at point, able degradation

The did and leadership to we up, make you trade, within will that. And in take all some price that leverage. we followship, trade to the product we So circumstance and of us parity you're show but can to sacrifice better and and mentioned, our is we give and a of extreme, did will not we're where volume a on in throughout that greater we more reason, continue markets boundaries can reason. and price to to than to a the we our as that is see Dollar, we're sort doing where because for make willing and journey a doing day. We're And will get pricing I there. reinvigorating pricing competitors, hope different get one. We're better brand that expectation it that

that going are a not skewed These discount. rent or to in twice toward XX-month be heavily at period. if experience meaningful price an is They people are but once the

that a depends up whole days. again, in Dollar up, doesn't price us we're ability taking around give confident on the And that. as notion our pricing share number pressure. bringing and experience to And bringing and static so I It on gaining and quite of will do said, days depend

of initiatives Okay. one you've for you one talk far? of quick benefits If about And some productivity Alex. now? could in just just the you are place attained guys squeeze in maybe kind what I the so have Can

the the collision fleet-related particularly prepared in progress like About half transportation initiatives. mentioned our are half masking that for day, labor through cost productivity, thanks over of $XXX improvements. these our the a Ian, as on we've And per at core Sure, the about related been DOE underlying you savings our and on is field question. look and is making productivity year-over-year transaction we've we damages When costs. savings remarks, achieved to and million fuel cost maintenance, in DOE in basis on of headwinds

into third-party on and it reduced productivity, third-party we've our labor it staffing theme reduced also as own on on over of labor, back we time, we've vehicle also field labor. documentation. maintenance And So the and our that, cut double-clicking relates to our

accuracy. able own management we've and costs, streamline our So our telematics bringing our in-house, to And fleet fuel, productivity on work better movements our of using we're our transportation and tools we're to reduce more fleet advanced employed improve achieve costs by objectives. On to transportation enhanced this costs. control

do looking our so initiatives as by our even these work new here, progress forward team COO Stephen there's driving to but to mentioned. So Justin we're And far, we're more and as further. encouraged Keppy the joining

question sure unmuted. Instructions] make [Operator line is John, Northcoast from Our Healy please that John with Research. next your comes

Jefferies. comes question next Moore Stephanie with from Our

Stephanie. Hans RPD I could or leisure kind I some moving time of maybe your more you on for did do Teslas of that's their kind is maybe also if just This any that? that RPD if you there? the was curious, Hoffman guess Teslas the quantify of of over was curious I given just you premium kind segment, maintain And into bump novelty premium of of these in kind give into sort quarter? so, sort can that there's think RPD factor of sort playing And discounts

Thanks for question. the

said, supply same have corporate a in electric under government, interest always in of and people one being sort this. is there the the cases, to think expressed. around a EV. Equally, of replacement insurance in that test to to side. brand up part leisure. lot insurance RAC insurance becomes are in government all But there's that we drive cars fleet bring and of I introduced the that these very sustainability drivers EV for view as where want to to around parts for with in of an that's people in forward, natural we we the have Tesla on our vehicles Hertz vehicles desire a demand those we in desire the being on in in equation and So Leisure, deployment fleet they equally, leisure, terms we've RAC replacement in electric where proposition And a see for on see curve. on our true are our demand as a of and demand need take will And inside who are interesting instances, product. And That holds these on bring opportunity the EV an being have. natural driving of number around course, growth replacement, want to who and another pick objectives corporate both line

natural and an are and equally that car of out. wants level and impactfully, benefit driver, maybe different them. And mobility strong that's in the RPU. I drivers because around from to most there's new, become net cars proving these around the about. fuel the We better or renting very and that into no that of real that RAC come in of to there used of our given for so and interesting who them companies more and is still rideshare of the drive both for as electric to by come virtue are to outcome extent the a on need a maintain a Again, electric part side inside and And of business the that been supply demand economic we and expensive, from a that to demand to number in demand. or driver that to say those market attain vehicle vehicle will economic the the them rideshare pockets the kind Hertz by entry are premium is incentives entry economics point an would yields

business drives remember, overall keep the with obviously cost longer costs, cost and but we're the we're more that longer length down in margin to that. length get keep, key and seeing And so in in incentives is of sort of experienced bringing high. damage and drives in with down that because in that feed is of it programs been meaningful and demand equally, rideshare pricing side, and ultimate designing seeing keep, rental we've tandem growth of the schemes to length equally drivers Uber down That of

And just on a bit. I decisions kind I touch capital helpful. allocation That's guess to wanted of

X I to you sort billion your guys authorization. left have buyback in think of close

thinking about Just QX as you buyback curious XXXX were in then how guys well. and into

Just curious a be higher and like then costs fleet kind could funding lower of limiting if here. factor potentially somewhat residuals

then all repeatedly is an said in fleet the opportunity, we buyback that of business in near-term an make have would rational short-term departure invest of what that no there's the a terms against at say X has of price stock investment. of and it's tandem from on terms those as both obviously but capital in take we given attractive and where opportunity in building of priority, looking to and the look, value non-fleet and Well, moved, decision I which deployment

Research. with Our Northcoast not sure next is muted. John comes John, Healy please your question from line make

with JPMorgan. Our comes Ryan from Brinkman next question

ask the tailwinds EVs like portfolio. a quarter start-up in purely you comments to also. EBITDA the versus the the Have I thought about maybe on kept such to tally of much running of strategy EV in and Hertz' quarter, days, the higher all manifest transaction for not certainty. blended as sure margin fall pro forma since a I possibly maintenance ICE appreciate of higher as even how this with day, although I'm itself you maybe XXXX, per lower routine costs didn't that can revenue measure which EBITDA

Tesla have number? there portfolio net it a date that which to would the might price that tailwinds damage EV et cited positive you like higher cost then resulting into residuals. cuts that other impacting transition higher XQ. the have EBITDA contributor the margins, of similar EV Do EBITDA automaker a or ICE by when collision the also, relative depreciation But you targeted then the from repair and cetera? also like turning And course, higher is But to then in portfolio

addressing it Well, not is start It's saying and positive positive by be up. we near-term challenges let EBITDA. straight to of understand that me some a off both proving as are to contributor given cost just these

sort way. so that understand to And it's it important of

want an entry desires offering we're they electric production the And offering business exist point would the that for a clear. I price way demand vehicles is of meaning to EVs stability with fleet. rideshare as our question would because and a out try vehicles the also our them, we're of a customers product think answer needs across as whole that both that and that's think, revenue your ICE. offering the into And product, of being function to is widest set. I'd our meet the say is of driven I to I mix purely customer remember, of

don't in by XX% think EV I So and virtue inside the growth fleet the rideshare. And I about better sort an growing they drivers. utilization but economics accelerated other costs for quite think that offer of where to in there in considerably me, are in of of of electric the and vehicles, is last get clear even better go that costs order response are misunderstand given fuel it's question, just ultimate by

to EV part call degradation offering out So tailwind. several Alex occasion The of DOE, see as of in year-over-year. revenue terms really a the what you margin is by down that's issue. Baseline points It benefit effect of dimensionalize came of of and product being to the contribution noted, in the EBITDA a pervasive so to this made. a the the this, is there costs of is not reason is is a XX% it

address to of deploy revenue the I how in equation the and in cost EVs. ability focus our think so is to terms equation where fix more the And

answers reflect that to ultimate the production better I fleet. us. across EV putting the think of the you If were in you'll start whole EBITDA question around but this see equally to the

just helpful. a Yes, follow-up is And that maybe as to it.

fleet a contemplating the percent repair addressing issue, there to away Beyond targets. EV might changes cost earlier such as other with strategy the regard are from be EV you pivoting maybe as of

of in to last capacity EV targets Over reiterate sales of week, demand from and expansion per to order the light be it changing target. away profitability pulled up unit for example, shore able EV or in its some has GM,

to vehicle RoboTaxi all time margin would new up sale back larger vehicles and say down a spoken year prices where Elon I aftermarket new he's vehicles. changing, make are are prices buyer the on installed at said the you this potentially monetizing to the Tesla way to because like willing now hoping -- recent But into. make other calls about Musk he you X% on thinking it a things how to by Tesla and a like lower to heard software sell at of services end continue the of on they the you're earnings you base of some comment being lower about where

pricing might just you're into if that forward. new automakers with how still even at going buying vehicle given strategy regard curious comfortable prices, So enter lower your mindset that calculus to Teslas

the let achieve we're me start. say Well, in buy a margin. X There's no just world going to to at EBITDA which Teslas

every will quite to to ours. may confident number on and be select hold among purchase OEMs, generated EBITDA a be it's the an will that that be attractive. We're So be margin not car threshold to where ROA positive but of that we're a strategy going

lower about better are, better me made prices at about prices. those better that. that just be let than I comment at by buyer threshold, So to being meet be a higher that cars a clear we for The that definition, buyer very buyer a

So price in decline purchases. the of will context forward us benefit

return. I'll continue margin our ourselves hold repeat believe hard first-mover We to going and percentage time, our XX% I think a much of going targeted get out electric fleet just to a meaning it's initially being to out being screen fleet. on said achieve of also to by to date before, important I'm we're very advantage. to XXXX. I've that's of meaning say stone, not fixed and by it that in as We're we had the to grow our and fleet electric not in hard this end EBITDA to the here,

that also and understand with because do, car, very involves pricing with established. They it, where in engagement that We're RAC. I'd with straight to government. we sake I would around And that have importantly, of the it's we're market less your for an we to that to sticky with and have ownership. to sort getting Tesla that skills change corporates, real. model earning gain our the engagement early challenges of of rhythm access commensurate the of work, greater that ticket growing out was pursue whole or learn first-mover And to with jump buyer. programs creating to we're that that's apps too I technology had of I said, easy in on suggest in We're how that, get edge rideshare we're technology seeing sort our are with the the engagement set line increase in think I context is a corporate whom learn rental I believe, of engagement there's going at engagement rideshare, exercise that a tell all what's sort contracts them use a to of mean, technology happened to you and be overnight. charging. who The call it's end, don't is no world a Uber why price we wants you this first-mover, so with how apps engagement the movements engagement, that do ease government a when see without EV the where among car of schemes we've I rationale grow. customers they're And think I look And point for with is poses around quickly it. your those want of in some I to and us around in operates sticky you Tesla and unique demand being has say cited to from rippable not our not. a on will as The buyer rent rationale, customer as context think would an the the starts when it's in presented. But conversations feeding we here, partners. you than not you a there. And at of would a to the a that competitive continue the that enable to relative that to dynamic But look are

plan ultimately All the of that address think have benefit be prove we sort produced I of these to the margin. to will near-term terms in of that costs great delta have value, in aspects that are through and a our

Chris comes SIG. with Our Stathoulopoulos from next question

about bit here and I little here. a and more efforts provide we this little around bit all some detail you detail be addressed tactics will Investor at of If the this -- I'm Could on helpful. would could EVs. a tactics the some initiative, of the but of the Thrifty guessing any Stephen, and Dollar talk a be appreciate lot here, time time Day, line your detail more line,

absolutely. Yes,

brand. in were significant. well ago. the the Thrifty more by context, challenge particularly with our that TAM that bought we to for is it that of I specification And And Dollar where a have, the and Hertz I were our decade not not that the here yet about that than just moved to I were think, is the attended out So competition think value relative value And it, to for brands part of they think quarter journey that a customer and it third brand proved ought around be. is sort

lower where consequence, other a as than we're price. And to compelled price brands value

to example, We'll make score competition. see procure they lower for then how opposed want a somebody, a appreciably the happen that is justify that And cares experience. as lower will than car that an or OTA to We coming us much to the Dollar about So don't judgment anymore. around use they to to Thrifty that a to need brand directly.

So pricing pricing order the improving journey regain parity. to ultimate we're in leverage and

we So and all, what book doing? shop are of better. is the First

much on other tablets services to are given offer airport Dollar be, in where with assigned want offer airlines and will you an like, code, you'll to you to the have the upgrades the airlines times gate again, go rent license wait there going with do upgraded we you extent the have shop that should That like and move with you the We will we service shop going Then various and better much people your want of then in QR other things. That value-added parties arrive off a who one you will products, than car space it, somebody where is the we'll car outcomes different to much will driver's exit that's yield long and at online. will communicate third a to book, process car proposition. an be where engaged do. like the show build captured from you a involves of book and will and you sort a advance, with the be it,

is this happening hypothetical. Now already at This not is X a airports.

this to project will cost, in this share. book to out. get is of to of a like already. not cars, that is validate the issues grab hone then can XX take is honed We're to any expand need then we a depreciated us context accretive test business, even share better much price we I'd be to lower this better and and the as as it, margin and going This static XX, question the to again, against that which So look and take to expand be meaningfully And lower when begun XX pricing. has it a it, top airports this of

from some at Okay. of line, the seasonally we've several the demand like fourth that I you least results And today. then side, said had airlines on know quarter -- but sounds is it in

U.S. demand is softening. here would suggest It the others. than that worse in leisure Some

to and however it So to detail as see as could more you bit you little perhaps then leisure relates -- inbound international. it a the provide buckets business it relates these

to I product, airlines, way end the value upper more emphasize. breaking brand, to the would premium and they a and differently in of read And which SKU mean there's leisure the would plays service dichotomy offering, Hertz which bit as or more I airlines corporate loyalty our that and as both I that say think the like. to obviously, Yes. of travel. certain a which component by travel, I listened kind travel I that's commentary a of of between I include

North in strength leisure, see to both in in and continue We America Europe.

to good around to what's see as view that brand. Obviously, could, then now the to to to economy quarter it's we the questions going as times certain as in or as could have it. have can as response to more do we consumer view booking capture on gain But to model I get the sort improve, to brand, can demand. do softer? to but We're what's It the that to to described of it pricing the sort deeper the slightly and around we SKU our a looking And happen of to the phase pricing or and for much Dollar the and Now We're obviously that do into looking being that in a see quite what airlines earliest into that obviously, pressure, we forward meaningful not year. conviction is happen that hard all of days. about just pickup next ability think in that see fourth we'll continue we of Hertz built, of hotels. is feel in to several airlines, context the in see pricing we some the as value get we leverage around brand I I've countervailing we're limited

So that's how through sort would this. parse of I

to go This today's Officer. concludes Chief session. I Please question-and-answer over would Executive ahead. hand Scherr, the Stephen call to now like

So thank all today. your participation for you

Operator. forward to their our close We to employees Hertz you, on continued XX,XXX customers. look to sharing updates for you the want our further I we next call, attention their and service of the Back thank with call. to Before

Earnings Global Conference Hertz Quarter Holdings the you Thank concludes your participation. Call. Third This for XXXX