Hertz To Hike Car Rental Prices

(RTTNews) - Hertz has announced plans to increase the retail prices for all Hertz, Dollar and Thrifty car rentals starting on January 1.

In a press release from the Hertz PR team, the company says that the price hikes are largely aimed at combating the depreciation of their fleet.

The move to raise prices is no surprise to industry watchers following a wave of consolidation that swept up a number of competitors.

Hertz's Chief Executive Officer and President John Tague released an official statement of the price increases saying:

"Fleet costs are escalating due to declining residual values and, as a result, we have implemented price increases across our car rental brands in the U.S. The company is pursuing cost reduction opportunities in addition to its previously announced program to cut expenses $100 million annually, while also increasing investment to improve our customers' rental experience, including refreshing the car rental fleet."

In addition to the price increases, Hertz also announced plans to cut costs by roughly $100 million annually, freeing up cash to refresh their aging fleet. News was well received by shareholders and Hertz's stock jumped 2.7 points to $23.21 on the day of the announcement, according to businessweek.com.

Last month, activist investor Carl Icahn raised his stake in Hertz to 10.77 percent from the 8.48 percent stake that he previously held in the company.