Hertz car rental files for bankruptcy after falling $19 billion in debt
Car rental company Hertz has just filed for bankruptcy in the U.S. and Canada.
After 102 years in the rental business, the Florida-based corporation has filed under Chapter 11 in the U.S. Bankruptcy court following the "sudden and dramatic" impact COVID-19 has had on travel.
An increase in car rental cancellations and a decline in future bookings led Hertz cut 10,000 jobs in North America in April, equating to a whopping 50 per cent of its global workforce .
"...Uncertainty remains as to when revenue will return and when the used-car market will fully re-open for sales, which necessitated today's action," said the company yesterday in a news release.
"The financial reorganization will provide Hertz a path toward a more robust financial structure that best positions the Company for the future as it navigates what could be a prolonged travel and overall global economic recovery."
Almost 700,000 of Hertz's vehicles are now sitting idle thanks to the virus, according to the Wall Street Journal, though the company says that all their businesses globally are still open and serving customers.
That includes Hertz, Dollar, Thrifty, Firefly, Hertz Car Sales, and Donlen subsidiaries.
Hertz is the second-largest American rental company, and has 10,200 corporate and franchisee locations across 150 countries.
The company's bankruptcy filing follows J. Crew's announcement that they, too, have filed under Chapter 11 following the major financial impact of the pandemic.
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