Hertz 2011 Annual Report Download - page 164

HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
Note 12—Restructuring
As part of our ongoing effort to implement our strategy of reducing operating costs, we have evaluated
our workforce and operations and made adjustments, including headcount reductions and business
process reengineering resulting in optimized work flow at rental locations and maintenance facilities as
well as streamlined our back-office operations and evaluated potential outsourcing opportunities. When
we made adjustments to our workforce and operations, we incurred incremental expenses that delay the
benefit of a more efficient workforce and operating structure, but we believe that increased operating
efficiency and reduced costs associated with the operation of our business are important to our
long-term competitiveness.
During 2007 through 2011, we announced several initiatives to improve our competitiveness and
industry leadership through targeted job reductions. These initiatives included, but were not limited to,
job reductions at our corporate headquarters and back-office operations in the U.S. and Europe. As part
of our re-engineering optimization we outsourced selected functions globally. In addition, we
streamlined operations and reduced costs by initiating the closure of targeted car rental locations and
equipment rental branches throughout the world. The largest of these closures occurred in 2008 which
resulted in closures of approximately 250 off-airport locations and 22 branches in our U.S. equipment
rental business. These initiatives impacted approximately 8,960 employees.
From January 1, 2007 through December 31, 2011, we incurred $530.5 million ($256.3 million for our car
rental segment, $221.5 million for our equipment rental segment and $52.7 million of other) of
restructuring charges.
Additional efficiency and cost saving initiatives are being developed, however, we presently do not have
firm plans or estimates of any related expenses.
Restructuring charges in our consolidated statement of operations can be summarized as follows (in
millions of dollars):
Years ended December 31,
2011 2010 2009
By Type:
Involuntary termination benefits ................................ $14.4 $12.2 $ 44.1
Pension and post retirement expense ........................... 0.4 0.4 0.7
Consultant costs .......................................... 1.3 1.1 7.6
Asset writedowns .......................................... 23.2 20.4 36.1
Facility closure and lease obligation costs ........................ 16.5 14.3 9.3
Relocation costs .......................................... 0.6 5.0 4.1
Contract termination costs ................................... — — 1.7
Other .................................................. — 1.3 3.2
Total ................................................. $56.4 $54.7 $106.8
Years ended December 31,
2011 2010 2009
By Caption:
Direct operating ........................................... $46.6 $43.5 $ 65.4
Selling, general and administrative ............................. 9.8 11.2 41.4
Total ................................................. $56.4 $54.7 $106.8
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