The Car and Truck Fleet and Leasing Management Magazine

Despite Competition, Hertz to Sell Used Cars in Salem

January 22, 2004

Hertz Car Sales, an Oregon- and Washington-based franchise of the Hertz rental-car company, plans to open a used-car lot near the Salem airport with space for 300 vehicles, reported the Statesman Journal.

Officials with Hertz Car Sales said the Salem car lot will have one of the largest inventories of used cars in the city and is expected to open in March and employ about 60 workers.

Hertz Car Sales currently has dealerships in Bend, Medford, and Klamath Falls, Ore., and Yakima and Pasco, Wash. The company is accustomed to being a big player in a small market, but the competition in Salem is expected to be intense. “This is going to be a little different for us,” said Eric Johnson, general manager of Hertz Car Sales. “We’re going to have to be aggressive as far as pricing and competition.”

Hertz Car Sales specializes in former rental cars. Vehicle for sale typically have 5,000 to 30,000 miles and are covered by manufacturers’ warranties.

The vehicles come from the Hertz rental-car fleet as well as other “program vehicles” purchased from brokers and at auctions. Hertz Car Sales’ inventory ranges from economy cars to trucks and luxury vehicles.

Don Lulay, owner of Lulay’s Car Connection in Salem and board chairman of the Oregon Independent Auto Dealers Association, said he was surprised by Hertz Car Sales’ aggressive push into Salem. The used-car business has been soft because of low interest rates and manufacturer incentives on new vehicles. Sales of program vehicles, in particular, have been hurt, he said. “It’s too close of a spread, when you have zero-percent financing on new cars,” Lulay said.

Last June, Portland-based Thomason Auto Group decided to leave the Salem used-car market after operating a lot on Mission Street for about a year. The departure of the deep-pocketed Thomason, Lulay said, is an indication of the difficulty of prevailing in the used-car business here.

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