One of the world’s largest car rental services Hertz announced bankruptcy, reports CNN.
The company was another victim of the economic downturn caused by the coronavirus pandemic.
Hertz offices continue to operate and serve their customers. The service stresses that it intends to stay in business, and the bankruptcy petition will allow restructuring the debts.
The company’s statement stresses that the impact of COVID-19 on travel and demand for car rental was too sharp, which caused the revenue to collapse. Apart from tourists, the clients of the service are often people whose cars are being repaired. But because of COVID-19, many people stay at home and they simply do not need cars. Hertz admits that they don’t know when these figures will return to the same level and when the used car market will recover.
CNN states that the bankruptcy of Hertz is probably the most resonant in the era of COVID-19. Earlier in the U.S. bankruptcy had to be announced by well-known clothing vendors JCPenney, Neiman Marcus, and J.Crew, as well as energy companies Whiting Petroleum and Diamond Offshore Drilling.
But none of them occupied such a huge market share as Hertz, which along with Avis, Budget (CAR), and private Enterprise dominate the car rental market. Hertz has about 568 thousand cars worldwide and about 12.4 thousand rental points (including franchises).
Rental service Hertz was founded in 1918 in the U.S. and began its work with a dozen “Ford”. It survived the Great Depression, almost complete stoppage of automotive production in the States during World War II and several oil crises.