Hertz Global Holdings appointed former United Airlines president John Tague as president and CEO, effective Friday, the company announced.
While new to the car rental segment, Tague has a long history in the travel industry, particularly at airlines. Most recently chairman and CEO of transportation and logistics supplier Cardinal Logistics Holdings, Tague had an eight-year tenure at United Airlines, including serving as president up until its merger with Continental Airlines in 2010. He also had two leadership stints at ATA Holdings Corp., parent of low-cost carrier ATA Airlines, between 1993 and 2002, interrupted by a stint as chairman and CEO of low-cost carrier Vanguard Airlines in 1996 and 1997.
Hertz board non-executive chair Linda Fayne Levinson in a statement noted Tague has a track record of driving "the successful turnaround of other large, complex consumer-facing companies," including United.
In a research note, MKM Partners managing director Christopher Agnew noted Tague's lack of car rental experience as a negative, saying his appointment "surprised investors who are unfamiliar with Tague and who were hoping for a CEO with car rental industry experience." However, Agnew also noted Tague's experience could prove beneficial.
"Hertz's issues in 2014 … highlight the dire need for improved revenue and yield management, [and] Tague's background in revenue optimization at United Airlines should be strongly suited to addressing this need," according to Agnew. He added that Tague's "experience with mergers is important for dealing with legacy issues around the Dollar Thrifty integration."
Former Hertz chairman and CEO Mark Frissora, who had led Hertz since 2007, in September stepped down from the position, citing personal reasons. Hertz Equipment Rental Corp. president and CEO Brian MacDonald acted as interim CEO during the company's leadership search.