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3 Things Investors Should Know About the New Deal Between Amazon and Hertz
The Motley Foolยท 2025-08-26 08:55
Core Insights - Hertz is collaborating with Amazon to sell used rental cars on Amazon's platform, aiming to increase the variety of car brands available for consumers [1][2][3] - The partnership positions Hertz as Amazon Autos' first fleet dealer, expanding the selection of vehicles beyond Hyundai, which is currently the only merchant on the site [5][7] - Hertz has a significant inventory of used cars, with approximately 250,000 vehicles available for sale annually, which aligns with consumer demand for more selection in the used car market [10] Group 1: Partnership Details - Hertz will allow customers to browse and purchase used cars on Amazon, with transactions completed at Hertz Car Sales locations in select cities [7] - The initial rollout will include Hertz locations in Dallas, Houston, Los Angeles, and Seattle, with plans for future expansion to all 45 Hertz Car Sales locations nationwide [7] Group 2: Market Demand - There is a growing consumer demand for a wider selection of used cars, as indicated by the success of Hyundai's participation in Amazon Autos, which has expanded from 48 to 130 cities [9] - Hertz's extensive fleet and variety of car brands position it well to meet this demand, particularly for used vehicles [10] Group 3: Financial Outlook - Hertz has faced financial challenges, including losses in the last six quarters and significant debt of $19.4 billion, which may limit the impact of this partnership on its stock performance [12][13] - In contrast, Amazon is financially stronger and profitable, which may allow it to negotiate favorable terms from the partnership with Hertz [14]