Hertz Files Bankruptcy

By Staff Writer May 27, 2020

Hertz Global Holdings Inc. announced it and certain of its U.S. and Canadian subsidiaries have filed voluntary petitions for reorganization under Chapter 11 in the U.S. Bankruptcy Court for the District of Delaware.

Hertz reported 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 took immediate actions to prioritize the health and safety of employees and customers, eliminate all non-essential spending and preserve liquidity.” Hertz added that “uncertainty remains as to when revenue will return and when the used-car market will fully re-open for sales, which necessitated the action. 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.”

Hertz’s franchised locations, which are not owned by the company, also are not included in the Chapter 11 proceedings. All of Hertz’s businesses globally, including its Hertz, Dollar, Thrifty, Firefly, Hertz Car Sales, and Donlen subsidiaries, are open and serving customers. As of the filing date, the company had more than $1 billion in cash on hand to support its ongoing operations. Depending upon the length of the COVID-19 induced crisis and its impact on revenue, the company may seek access to additional cash, including through new borrowings, as the reorganization progresses.

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Last modified on Thursday, 28 May 2020 13:28

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