Car rental service Hertz has filed for Chapter 11 bankruptcy. Hertz has stated that:
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 still has $1 billion cash on hand to support continuing operations and Hertz and it’s subsidaries are open and still serving customers.
All reservations, promotional offers, vouchers, and customer and loyalty programs, including rewards points, are expected to continue as usual
This bankruptcy filing applies to it and certain of its U.S. and Canadian subsidiaries but international operating regions including Europe, Australia and New Zealand are not included. In addition franchised locations are not included in these proceedings.
They have not processed my status match from early last week…
…All reservations, promotional offers, vouchers, and customer and loyalty programs, including rewards points, are expected to continue as usual
Not that many people say that they “Love Hertz” but Nazareth sang a song about it.
https://youtu.be/soDZBW-1P04
Que the high hat
good riddance, worst and most frustrating company I have ever dealt with. “A car reservation does not guarantee a car” WHAT THE FUCK DOES IT GUARANTEE THEN AND WHY WOULD YOU TELL ME ON THE MORNING OF MY VACATION
They take the reservation, they just don’t keep the reservation
Hertz’s intangible assets are overrated i.e. Net Goodwill is valued at $1.08B but it that was liquidated about 4 or 5 CEO’s back. Haha.
“And that’s really the most important part of the reservation. The HOLD! Anyone can just take ’em”
At least the reciprocal is also true, no show has no penalty unlike airlines or hotels
Looks like their listing are as low a couple thousand below Kelly Blue Book. Is this typically the price they sell for?
Don’t have an experience, but I’ve heard before that rental cars are usually sold at a discount. The argument is that the owner take better care of the car (or that’s the perception of the market anyway).
With 2020 models nut being driving for a long time this year, I wonder if there are deals to be had
I heard this earlier. But after I was ripped off by enterprise, I take care of the rental car much better than my own ones.
It is. Whenever i looked at Hertz Car Sales their pricing was always thousands below KBB (which is a horrible way to value what your car is worth).
The best deals on ex-rental cars are usually at the auctions (though there’s obviously more risk).
Not normally that is closer to the wholesale price that dealers might pay at auction, but dealers haven’t been buying at auction with COVID.
Dealers have a KBB type guide for wholesale prices (auction prices). Its called the Manheim Used Vehicle Value Index.
http://publish.manheim.com/content/dam/consulting/ManheimUsedVehicleValueIndex-LineGraph.png
I think with Hertz BK an unemployment, remote work, we will see a second dip in prices like we did in late 2008.
DasApache
found the vulture
Reminds me of the times they overcharged me.
Maybe they just need a new spokesmurderer
https://m.youtube.com/watch?v=Uqd_XZYkZ70
Nice.
How does Dollar and Thrifty survive?
The purchase of Thrifty by a previous CEO is what for them in trouble in the first place.
https://www.nytimes.com/2020/05/22/business/hertz-bankruptcy-coronavirus-car-rental.html
So they had rising income but $17 billion in debt. Sounds just like people who have good jobs but huge amounts of credit card debt. It never ends well.
The reason they have $17 billion in debt is because of their fleet. Unfortunately, the used car market has been… less than great as of late and so the cars securing that debt are now worth substantially less than anticipated.
That, coupled with the demand for rental cars plummeting has put Hertz in a rather precarious situation.
Most parts of our economy are overleveraged and are just as fragile. CV19 simply exposed the financial fragility of our debt driven, trickle down, house of cards economy. Hertz is just the beginning. The lenders will lose the money and X% of employees will lose their jobs. Consumers will have fewer choices in future and rental prices will sky rocket. Just check airline ticket prices. These bastards bought their own stock, made flying as miserable as it can be, screwed taxpayers with bailout money, and now screw them again with fewer flights, fewer routes, and skyhigh prices. No accountability for bad behavior. Investors and previous C-suite folks made out like bandits as usual.
They might have $1billion in cash but they have around $18 billion in debt, most of it secured by their fleet which is depreciating by the day.
Will they be selling off some of their fleet?
Yep – particularly some of the more valuable niche specialty cars they’ve got: https://www.thedrive.com/news/33575/hertz-is-also-selling-a-pair-of-its-hendrick-tuned-750-hp-chevy-camaro-zl1s
https://jalopnik.com/tag/hertz
aw I was hoping the taxpayers would be fully bailing them out to help the shareholders and the CEO 🙁
They “hope” to sell 30k vehicles a month thru the rest of 2020.
If that lofty goal is met that’s 210K; which is about 4% of all new vehicles that we’re sold last
year in the US 2019.
Rental fleets made up 10% of all new vehicle sales last year in US- but this also includes other rentals such as HD, Lowe’s, U-haul, Budget and “white cargo vans” type commercial vehicles.
As well at new car dealerships still have Inventory of “New” vehicles model years 2019, 2020 and shortly 2021 “M.Y.”. There is also a glut of new “Imports” parked/stored at Stadiums near sea ports.
https://www.latimes.com/california/story/2020-05-19/photos-stadiums-and-lots-overflow-with-cars-as-coronavirus-takes-an-economic-toll
With low APR, for used and desperate manufacturers- will be throwing cash and 0% at those looking for a deal on a new vehicle, that can also qualify for a loan – a perfect storm for the auto industry. With millions under/unemployed and business travel likely to. remain stagnant and more workers permanently working remotely and so on……
That’s partially offset by the fact that the auto makes can’t produce make new cars so you’ll likely see a drop in used car prices while new cars hold up a bit better due to scarcity
What about trade-ins?