(Bloomberg) -- Hertz Global Holdings Inc. reached agreements with Uber Technologies Inc. and Lyft Inc., the two largest U.S. ride-hailing startups, to supply drivers with vehicles the rental-car company rotates out of its fleet.
The partnerships, announced in statements Thursday, may mark a reversal for Hertz, which said in January that ride-sharing services were crimping growth. Uber and Lyft have been seen as a threat to auto-rental companies as travelers opt for an on-demand ride as opposed to driving a rented vehicle.
“Largely, Uber is a technology company, so if you think about who can provide fleet management services I think the list is rather short” and includes Hertz as well as Avis Budget Group Inc. and Enterprise Holdings Inc., said John Healy, a Northcoast Research analyst. Hertz is “already on the fringes of this business,” he said, adding that it could be a big market for the company, which he rates a buy.
|Hertz rotates about 200,000 cars each year
The vehicles Hertz will supply to Uber and Lyft are well-maintained and in good condition, Chief Executive Officer John Tague said. Hertz rotates about 200,000 cars out of its fleet each year in the U.S., said Hertz spokesman Bill Masterson.
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