Howdy! I hope your week’s off to a great start.

This week, we’re diving into a story that’s flying a bit under the radar but could become a blueprint for legacy companies under pressure. Hertz, the 106-year-old rental car giant is making a major strategic pivot: launching a fully online car-buying marketplace.

At first glance, this might seem like just another used-car sales website. But beneath the surface, it’s a structural shift that touches inventory strategy, customer acquisition, digital transformation, and revenue resilience.

In a world where rental markets are volatile, used car values fluctuate wildly, and new entrants are nibbling at every corner, Hertz is trying to reclaim control of its economics. And if it works, this pivot could reshape how legacy service companies think about turning operational byproducts into strategic assets.

Lets hop into it!

Hertz is synonymous with rental cars. Founded in 1918 by Walter Jacobs with a dozen Model T Fords, it grew into one of the most recognizable travel brands in the world. Over the decades, it pioneered airport rental lots, corporate fleet deals, and loyalty programs that shaped modern car rental. After five years, he sold the company to John D. Hertz, the Chicago Yellow Cab magnate, who transformed it into the nation’s leading car rental business.

But what many people don’t realize is that Hertz has always been quietly in the car sales business. Every rental car has a life cycle: it’s bought, used in the fleet for a few years, then sold. Historically, those cars were either liquidated through auctions, sold in bulk to dealers, or offered directly to consumers through Hertz Car Sales lots scattered around the country. This is no secret in the industry, with their largest competitor Enterprise Rent-A-Car having the same system for their used vehicles.

This sales division was valuable but underutilized. Most of the transactions were in-person, inventory visibility was limited, and customers typically stumbled upon Hertz’s sales operations rather than seeking them out. For decades, Hertz treated car sales as a secondary function. Necessary, but not strategic. After all, their main business is renting vehicles not selling them… right?

Then came COVID. The pandemic crushed rental demand and forced Hertz into bankruptcy in 2020. To survive, it had to liquidate huge portions of its fleet. That process revealed something important: Hertz owned an incredibly powerful asset. its cars. But they didn’t have a modern system to sell them efficiently. It relied on third-party auctions, which meant lower margins and less control over the customer experience.

Coming out of bankruptcy, Hertz leadership made a conscious shift. They adopted a “Buy Right, Hold Right, Sell Right” fleet strategy focusing on buying vehicles that fit demand patterns, holding them strategically, and selling them at the optimal time to maximize value. This wasn’t just about squeezing out more dollars; it was about stabilizing a business inherently exposed to economic cycles.

Over the next few years, Hertz began experimenting with ways to make car sales more digital. One of the biggest moves came in August 2025, when Hertz launched a pilot program with Amazon Autos. Shoppers in select markets could browse used Hertz inventory directly on Amazon, arrange financing, and complete purchases online essentially bringing the dealership to their browser.

This partnership was more than a marketing stunt. It was the proof of concept they needed: customers would buy ex-rental vehicles online if the process was seamless, transparent, and came with trust baked in. Hertz gained digital distribution without building the entire infrastructure from scratch. But it also gave away margin and customer relationships to Amazon.

By mid-2025, Hertz had the data, the operational experience, and the motivation to take the next step. Instead of relying on third parties or treating car sales as a side hustle, it decided to own the full customer journey.

In late September 2025, Hertz officially announced the launch of its fully online car-buying marketplace under the Hertz Car Sales brand. Customers can now complete nearly the entire buying journey digitally from browsing inventory and arranging financing to evaluating trade-ins and selecting warranties. In select markets, Hertz even offers home delivery, mimicking digital-native used car retailers like Carvana and CarMax.

This isn’t just a website refresh. It’s a strategic repositioning of Hertz’s car sales business. Previously, much of the post-rental car sales happened through wholesale channels or fragmented retail lots. Now, Hertz is centralizing its inventory digitally and bringing the process in-house, cutting out middlemen and controlling both margins and brand experience.

The move also represents a shift away from its reliance on the Amazon partnership. While that program continues, the new platform allows Hertz to own the data, the customer relationship, and the checkout process directly. In the modern automotive landscape, that control is gold.

The announcement landed well with investors. Hertz’s stock (HTZ) ticked up around 2.5% on the day of the news, a modest but telling sign that the market sees this as a smart diversification play. More importantly, this move comes at a critical moment for Hertz’s core business.

The rental market is inherently cyclical. Seasonal peaks, interest rate fluctuations, supply chain shocks, and shifts in consumer travel habits can all swing margins dramatically. Hertz also learned a hard lesson through its EV fleet experiment. The company’s aggressive push into electric vehicles in 2022–2023 backfired when maintenance costs and accident repair expenses for EVs ballooned. By 2024, Hertz began offloading tens of thousands of EVs to rebalance its fleet.

The new marketplace gives Hertz a release valve. Instead of being entirely dependent on rental revenue, it can generate meaningful margins on used car sales especially when residual values are strong. Because Hertz already owns the cars, its cost basis is lower than traditional used car dealers, giving it pricing flexibility.

Of course, this pivot is not without risk. Selling cars online is a brutally competitive business. Carvana and CarMax have poured billions into logistics, financing, and customer experience infrastructure. Margins in used car retail can be razor-thin, and the operational complexity of shipping, warranties, and customer service is non-trivial.

But Hertz enters the arena with a few unique advantages.

If successful, this marketplace could compress Hertz’s value chain, selling cars directly to consumers instead of liquidating through auctions while also smoothing revenue volatility between rental cycles, something they’ve been struggling with since coming out of bankruptcy. In a sense, Hertz is taking a page from Amazon itself: turning what was once backend infrastructure (fleet liquidation in this case) into a front-end business.

When your core business is volatile, you can’t just ride out the storm forever. You either let the cycle control you, or you build a new leg to stand on. Hertz’s pivot to digital car sales is a clear example of the latter.

This isn’t a flashy side hustle; it’s a structural adjustment to the business model. Hertz is trying to turn a cost center (fleet depreciation) into a strategic growth engine by controlling more of the value chain and using digital infrastructure to reach customers directly.

You don’t always have to leap into a new industry to adapt. Sometimes, the biggest opportunities are sitting quietly inside your existing operations. If you control inventory, customer relationships, or data, ask yourself: “What would happen if I stopped outsourcing this piece and owned it end-to-end?”

Hertz is betting that by controlling how it sells cars, it can insulate itself from some of the rental business’s volatility, diversify revenue streams, and give itself more levers to pull in both good and bad cycles. That’s a powerful model for any legacy company or startup navigating turbulent waters.

Hertz is also quietly building the infrastructure to last this time around. After taking the lessons from their 2020 bankruptcy that almost eradicated their 100+ year history, they’ve made moves to compete and stay relevant well into the future.

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