The Hertz company is synonymous with renting a car, and you might have probably used their services or at least heard about them if you have done some form of travelling. The Hertz company was started in 1918 by a young Chicago businessman by the name of Walter Jacobs with twelve Model T Fords, the original name of the company is Rent-a- Car Inc. His business idea was borne out of the need that travelling salesmen at the time had for cars when going on long distances to make sales calls. The business quickly developed and by 1923, the fleet of vehicles owned by Jacobs was at 600, and the company was generating over a million dollars in revenue! The company was purchased by John Hertz in 1923, and this is how the legendary name Hertz came into existence. Hertz has undergone tremendous growth and expansion over its 100 years of operation and now has a total of 9700 locations in 150 countries, employing over 37000 people, it is the second largest car rental company in the world by revenue generation and number of locations.  We will examine reasons why Hertz has been so successful in the car rental business across the globe.

Alliances and acquisitions

One of the strategies used by Hertz that has been very successful in the dynamic car rental business is forming strategic partnerships and acquisitions. The company used this strategy from very early in their operations when the company was merged with General Motors in 1926. The strength of the General Motors brand was used as a growth strategy for Hertz, and the company expanded to Canada, Europe and South America during the time of the partnership. This partnership with General Motors helped to position Hertz as a truly global player in the car rental business. John Hertz repurchased the company from General Motors in 1953. The company made another strategic growth decision when it was acquired by United Continental Holdings in 1985; this partnership resulted in the expansion of the Hertz fleet of vehicles by over 400,000 and the company now had a presence in over 120 countries. The Hertz car rental business also expanded to the Chinese market in 2002, exposing the company to the largest population in the world and exciting growth possibilities. Hertz also purchased the British car rental company British Car Auctions in 2009 as a means of getting a foothold in the British market.

Innovation for growth

The Hertz company has also used innovation as a growth strategy. They have used technology along with social trends to offer more fulfilling car rental experiences to existing clients and also to attract new clientele. One such innovation was the introduction of Satellite radio to its rental fleet in the year 2000, giving clients a more exciting entertainment experience.  Another was the introduction of hourly car rental options in some large city locations such as Boston and New York in 2007. Also, the company introduced a “green” fleet of vehicles in 2007 to serve the growing demand for vehicles that did minimal damage to the environment. On the other hand, a line of luxury cars and high performing sports cars were introduced in 2013 to service the growing demand for such vehicles by car renters.


Franchising has been one of the significant drivers of growth for the Hertz company worldwide. Hertz has been offering franchise opportunities to savvy business people since 1941 and currently has over 4000 franchisees all over the world. This strategy has worked for the company in terms of revenue generation from fees and establishing the Hertz brand in new markets.

In concluding, the Hertz Company has survived for a 100 years because it has forged strategic partnerships, while been on the cusp of innovation and responding to changes in market demand in the dynamic car rental business over the years.  With threads from ride sheering companies such as Uber and Lyft, Hertz will have to continue being proactive in the marketplace and respond accordingly to new trends and innovations in order to survive for another 100 years!