Hertz: Car rental firm files for US bankruptcy protection

  • In Business
  • 2020-05-23 05:03:32Z
  • By BBC
Hertz: Car rental firm files for US bankruptcy protection
Hertz: Car rental firm files for US bankruptcy protection  

Car rental company Hertz has filed for bankruptcy protection in the US after the pandemic saw its business plummet.

The firm, which earns much of its income from car rentals at airports, said it had been affected by the sharp downturn in global travel.

It will continue to operate while restructuring its debts.

Hertz's international operations in Europe, Australia and New Zealand as well as its franchised locations in the US are not affected.

The company - which began operating a century ago in Chicago with a dozen Model T Ford cars - had already furloughed or laid off 20,000 employees, or around half of its global workforce, in response to the pandemic.

Its chief executive resigned last week.

  • US to borrow record $3tn in pandemic spending

  • Fed warns of slow recovery without more virus aid

Before the pandemic the company had amassed billions of dollars in debt, with the rise of ride-hailing apps leading to a drop in demand for car rentals.

"The impact of Covid-19 on travel demand was sudden and dramatic, causing an abrupt decline in the company's revenue and future bookings," Hertz said on Friday.

While it had taken "immediate actions to prioritize the health and safety of employees and customers, eliminate all non-essential spending and preserve liquidity", the uncertainty over if and when the market would recover led to its decision, it said.


More Related News

Rental fleets
Rental fleets' cancellations drag down otherwise promising U.S. vehicle sales

Unused rental cars are stored in the parking lot of Dodger Stadium in Los Angeles. Dodger Stadium and Angel Stadium are housing the cars as companies are left with a surplus of unused vehicles and limited capacity to store them. The collapse in demand for new vehicles from U.S. rental car fleets hit automakers hard in May, even as consumer sales were stronger than expected and coronavirus stay-at-home orders began to ease.

Leave a Comment

Your email address will not be published. Required fields are marked with *

Cancel reply


Top News: Business