Hertz seeking to avoid bankruptcy after missing lease payment, report says
No trip, no rental.
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Quarantines and other newer ones Corona virus Measures have decimated travel both globally and domestically. Of course, this also affects tangential industries such as rental cars. A report claims that a car rental giant may face major financial problems as developments continue.
Hertz has not made a lease payment and is examining a possible bankruptcy. The Wall Street Journal reportsciting sources familiar with the matter. In a statement to Roadshow, Hertz confirmed its financial situation: “We are reducing spending, postponing capital expenditure and adjusting fleet and staff levels based on the significant drop in travel demand,” said a Hertz spokesman via email. “It is important that discussions are currently underway with our lenders and that we continue to talk to the US Treasury Department for support.”
Of course, money is at the center of things. With fewer travelers and fewer rental cars, companies like Hertz have to stare at fixed cost bills like vehicle payments. According to the WSJ report, Hertz is currently working with its major lenders and “certain holders of its vehicle finance subsidiary’s debt securities” to slow payments as the company adapts to the current market. However, according to a statement Hertz provided to the WSJ, he has not yet received support for a waiver.
According to the WSJ report, Hertz currently has $ 17 billion in debt, most of which is due to vehicle notes from its rental fleet. Like competitors like Enterprise, Hertz fired employees and tried to bring the money together to continue working in these lean times.
Hertz is still in a payment period that ends on May 4. At this point, the company may need to take other measures.
First published on April 29th.
