Car rental firms Hertz, Avis zoom as tariffs seen hurting new-vehicle demand
1. Shares of Hertz and Avis surged due to potential car rental demand increase. 2. Trump's 25% tariff proposal could shift consumers towards renting over buying.
FAQ
Why Bullish?
The announcement of tariffs historically boosts rental companies' stock as consumers shift behavior towards rentals, such as during past tariff discussions in 2018. This trend suggests a spike in demand for rentals, benefiting CAR's market position.
How important is it?
The article discusses macroeconomic factors affecting the automotive rental industry, potentially increasing CAR's revenue. The stock's performance in relation to tariffs could indicate broader market trends.
Why Short Term?
Immediate consumer reactions to tariff announcements typically drive rental demand surges, visible in previous tariff scenarios. The rental market can see a swift shift in consumer behavior as new vehicle costs rise.