(Reuters) -Hertz Global Holdings Inc on Thursday posted a near 54% drop in its first-quarter profit as the rental car firm spent more on vehicle maintenance.
While demand for rental cars remains strong as more companies mandate work from office and people resume traveling after a long pandemic-induced hiatus, costlier maintenance and labor charges are eating into the margins of rental car companies.
Still, Hertz benefited from price hikes on one-way rentals amid flight disruptions in the U.S., as more people opted to hire vehicles and get to their destination on time.
The company’s quarterly revenue came in at $2.05 billion for the quarter ended March 31, compared with $1.81 billion a year earlier.
Shares of the company rose 3.23% to $15.64 in premarket trade.
Meanwhile, net income fell to $196 million, or 61 cents, compared with $426 million, or 82 cents per share, a year earlier.
(Reporting by Nathan Gomes in Bengaluru; Editing by Shinjini Ganguli)
