Hertz Lowers Vehicle Depreciation Expense by 13%

Hertz Global Holdings’ monthly net per unit vehicle depreciation expense decreased 13% to $302 for its U.S. operations, during its first quarter of 2018.

Factors that contributed to this performance were more favorable purchase prices on like-for-like model-year 2018 vehicles, an increased penetration of remarketing vehicles through higher-yielding sales channels, and significantly decreased losses in 2018 versus 2017 that were incurred as part of the prior year quarter's rebalancing of the fleet mix and level.

These savings were partially offset by higher expenses associated with Hertz’s operating turnaround initiatives.

Utilization improved to 79% on higher transaction day volume. Hertz’s fleet size declined nearly 3% in the quarter, excluding the growth in fleet specifically dedicated to ride-hailing rentals.

Overall revenues for the company totaled $2.1 billion, 8% more than in the first quarter of 2017. First quarter 2018 net loss narrowed to $202 million, compared to $223 million in the prior year period. Total U.S. rental car revenues increased 5% as a result of a 6% increase in trasaction days and a 1% decline to total RPD, compared to the year-ago period.

Internationally, Hertz increased revenues by 14% in the quarter — from $411 million in 2017 to $468 in 2018 — while adjusted pre-tax loss widened from $4 to $6 million. Hertz’s international operations experienced a 2% decrease in transaction days and an overall increase in monthly per-unit depreciation expense of 9%.

Related: Hertz Q3 Revenue Rises Slightly