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Hertz boss: We've cut costs by 25%
updated 7:52 PM EST, Wed December 12, 2012
- Car renting company Hertz has cut costs by 25% in four years, in part by introducing cost-efficient rental kiosks
- Hertz has also launched the world's first global car club, allowing customers to pick up rentals in designated parking lots
- The company has been buffered from economic woes by rising demand for luxury cars in emerging markets
(CNN) -- Hertz has been forced to cut costs by 25% over the last four years as the global financial crisis continues hit one of the world's largest car rental companies.
And Hertz boss Michel Taride believes the pain is likely to continue. Taride told CNN: "I personally think the situation in Europe is going to last for a few years. The question for companies like ours is how we can grow profitably in a challenging environment."
The car rental industry, with its close ties to airline traffic and hotel bookings, is particularly sensitive to cross-border financial turmoil.
U.S.-based Hertz -- which operates from 8,500 locations across 150 countries -- isn't just cutting expenditure to deal with the global slowdown. It is also moving away from "bricks and mortar" costs by investing in virtual rental kiosks, among other changes.
Hertz has also launched the world's first global car club. Operating across Europe, the U.S., and Australia, it gives members access to vehicles parked in designated lots around town.
'It is growing extremely fast, even though it doesn't account for a huge part of revenue yet,' Taride said.
Luxury cars are also buffering Hertz from the economic gloom. In the Middle East, China and Russia, hiring Aston Martins and Ferraris remains popular, Taride told CNN.
At the other end of the glitz scale is Hertz's niche business of renting equipment to large construction firms.
"We're generalists. Renting is a competency of ours and once you know how to rent, buy, run, sell or manage assets effectively and do this with great service and great people then you can rent nearly anything," Taride said.
CNN's Arvid Ahlund contributed to this report.
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