- September 21, 2022
ESTERO — The Hertz Corp. has named former Goldman Sachs executive Stephen Scherr as its new CEO, the fourth person to hold that title in the past three years and the eighth in the past seven years.
Scherr takes over for Mark Fields, who took over as interim CEO shortly after the company exited bankruptcy last year.
“Stephen is the leader Hertz needs to grow our business and to have a formidable position in the future of mobility and fleet management,” says Greg O'Hara, the chair of Hertz’s board and founder and senior managing director at Certares, in a statement announcing the hiring. “He is a proven strategist, innovator and leader with a track record of earning customer loyalty.”
Scherr spent about 30 years working at Goldman Sachs before leaving last year. He was the firm’s CFO at the time.
According to a story in the Wall Street Journal at the time his departure was announced, Scherr “was well liked across the firm and by investors for shedding some of Goldman’s signature secrecy and bringing more transparency and predictability to its financial results. The firm’s stock has more than doubled over the past two years, leading other big banks.”
The story also says the CFO at the venerable firm historically acted as co-CEO.
At Hertz, Scherr is stepping into a company that emerged from bankruptcy less than a year ago determined to reimagine itself yet facing headwinds.
In the past few months, it has announced and begun to implement an electric vehicle program that includes buying 100,000 cars from Tesla, a partnership with Uber to make Hertz vehicles available to drivers, a partnership with online automobile retailer Carvana to sell its fleet, and it joined the Nasdaq exchange.
And in October, it reported $2.2 billion in revenue for the third quarter, up 19% over the second quarter.
According to its initial Chapter 11 filing, Hertz had $25.8 billion in assets and $24.3 billion in debt on March 31, 2020, less than two months before it filed May 22.
Hertz exited bankruptcy June 30 with $5.9 billion in capital, its debt load reduced, a new ticker symbol and a new board of directors.
Despite the advances, it faces a lawsuit claiming it incorrectly reported rented vehicles stolen leading to the arrest of customers. Also, shortly after announcing the deal with Tesla, Elon Musk tweeted that no contracts had been signed.
Still, those issues seem minor when compared with what it dealt with pre-bankruptcy when COVID-19 brought the global tourism industry Hertz relies on to its knees, forcing the company to lay off thousands, shutter locations and, eventually, seek the help of the courts to stay afloat.
“We have bold plans for Hertz over the long haul and we need a leader who knows how to turn big ideas into reality while inspiring people to work hard for change,” says Tom Wagner, a Hertz board member and founder of Knighthead Capital, in the statement. “Stephen has the patience, tenacity and charisma needed to push Hertz forward.”
According to a filing with the United States Securities and Exchange Commission, Scherr will earn $1.5 million in base salary and get a performance bonus targeted at 160% of the salary. He will receive shares of company stock as well.