Rental car giant Hertz files for bankruptcy

I am sure there will be others as anyone who is in the tourist or travel industry is probably in serious financial trouble. Restaurants, airlines, car companies, just about any business you can think of that has or needs onsite customers better have some deep pockets to weather this viral situation.

Hertz Global Holdings Inc., one of the nation’s largest car-rental companies, filed for bankruptcy protection Friday, saddled with about $19 billion in debt and nearly 700,00 vehicles that have been largely idled because of the coronavirus.

The Estero, Fla.-based company entered chapter 11 proceedings in the U.S. Bankruptcy Court in Wilmington, Del., hoping to survive a drop-off in-ground traffic from the pandemic and avoid a forced liquidation of its vehicle fleet.

www.foxbusiness.com...

I figured a huge company like that would have measures in place for something like this.

100yrs + and billions in debt??

Well, theres gunna be bulk 2nd hand cars for sale with immaculate maintenance records.

Well Hertz was in trouble even before the virus but others will soon follow.

Corporations don't usually sit on enough cash to withstand six months of zero revenue. When corps have cash, they will buy back shares, distribute dividends or invest in new projects.

Even good companies only make at most a 10% return. Do you really think companies banked profits for a decade?

There's going to have to be special bankruptcy laws. Debt, mortgage and rent will have to be reset - like the last six months to a year didn't ever happen.

I think a LOT of their business was airport

and aviation has taken a huge hit last two months.

sorry to see anybody close. wonder how their competitors are doing.

a reply to: Daughter2

Then doesn't that just pass the puck to debt holders, landlords, and banks? Also, then again, banks got bailed out in 2008, so who knows what the government will do.

Ouch. Kinda things to expect when society gets shut down. Relativity we are still in the early stages of this lock down. Who really knows when it will end? Quite easy to send everyone home, can happen in an instant. As for getting people back to work can take years. Standard for a lot of business to operate at a loss for the first year or two when starting up.

We are not out of the woods yet.

a reply to: 727Sky

I have a special fondness for Hertz it'll be sad to see them go , was in a band in which we all had made up names , our lead guitarist was Hertz Van rental ... Ah those were the days.

originally posted by: Agit8dChop
Well, theres gunna be bulk 2nd hand cars for sale with immaculate maintenance records.

Well, I hate to be that guy, but we could really use another car and we've rented from Hertz before. The rental was pristine, ran very well, it was so nice we really didn't want to go back to our old car. lol If the price is right, I'll take advantage.

originally posted by: TheBloodRed
I figured a huge company like that would have measures in place for something like this.

You would have thought that somewhere on the planet there would be someone who had measures in place for something like this. This is what happens when you only think about money and don't care about lives.

@everyone being like "shouldn't a big corp have lots of savings?"
what's getting you confused is that the ceos have lots of savings.
when the business does well, the bosses get bonuses,
that money doesn't go back into the company.
works fine [if you're a boss] during the boom times
then there's a crisis and all of a sudden your globally recognised monolith can't put fuel in the tank

originally posted by: continuousThunder
@everyone being like "shouldn't a big corp have lots of savings?"
what's getting you confused is that the ceos have lots of savings.
when the business does well, the bosses get bonuses,
that money doesn't go back into the company.
works fine [if you're a boss] during the boom times
then there's a crisis and all of a sudden your globally recognised monolith can't put fuel in the tank

The 2008 bank bailouts proved this.

The guys at the top still got multimillion bonuses while the rest of us plebs picked up the pieces.

I find it truly amazing how little people understand about the business world.

One minute they bitch that corporations don't pay taxes... That's because the tax system takes their profits so they are penalized heavily for doing a good job.

Then the next minute they bitch that corporations should have prepared for a situation like the pandemic.
How exactly?
The tax system makes that impossible.

Most people can't go two months without income but a business is expected to do just that.

originally posted by: Wide-Eyes

originally posted by: continuousThunder
@everyone being like "shouldn't a big corp have lots of savings?"
what's getting you confused is that the ceos have lots of savings.
when the business does well, the bosses get bonuses,
that money doesn't go back into the company.
works fine [if you're a boss] during the boom times
then there's a crisis and all of a sudden your globally recognised monolith can't put fuel in the tank

The 2008 bank bailouts proved this.

The guys at the top still got multimillion bonuses while the rest of us plebs picked up the pieces.

I want to point out that the people at the top are employees. They have a contract .
The banks have no choice but to honor the terms of those contracts.
This topic came up during the last bailout.
People that had nothing to do with the day to day operations did the work assigned to them and earned the bonuses specified in the contracts.

originally posted by: Bluntone22
I find it truly amazing how little people understand about the business world.

One minute they bitch that corporations don't pay taxes... That's because the tax system takes their profits so they are penalized heavily for doing a good job.

Then the next minute they bitch that corporations should have prepared for a situation like the pandemic.
How exactly?
The tax system makes that impossible.

Most people can't go two months without income but a business is expected to do just that.

It is because they can't relate to the sums of money. They just hear a company had say 10 billion in revenue... they dont see the financial statements also showing 10 billion in debt, nor the overhead expenses and the company only made 5 cents in profit for every dollar in revenue. Then they see the CEO makes 10 million a year. They then think the company just has billions laying around.

a reply to: 727Sky

Well, not surprised, I was usually good for one rental a week minimum and I've been at zero since the shutdown, can't imagine many people are traveling for work anymore or for the foreseeable future.

originally posted by: Bluntone22

originally posted by: Wide-Eyes

originally posted by: continuousThunder
@everyone being like "shouldn't a big corp have lots of savings?"
what's getting you confused is that the ceos have lots of savings.
when the business does well, the bosses get bonuses,
that money doesn't go back into the company.
works fine [if you're a boss] during the boom times
then there's a crisis and all of a sudden your globally recognised monolith can't put fuel in the tank

The 2008 bank bailouts proved this.

The guys at the top still got multimillion bonuses while the rest of us plebs picked up the pieces.

I want to point out that the people at the top are employees. They have a contract .
The banks have no choice but to honor the terms of those contracts.
This topic came up during the last bailout.
People that had nothing to do with the day to day operations did the work assigned to them and earned the bonuses specified in the contracts.

I see your point but lots of people had contracts and got laid off.

a reply to: Wide-Eyes

I'm in the employment industry and seen all kinds of contracts and regular employment regulations.
Usually there is a section covering layoffs.

But I've also heard some weird ones too...lol

originally posted by: Necrobile

originally posted by: Agit8dChop
Well, theres gunna be bulk 2nd hand cars for sale with immaculate maintenance records.

Well, I hate to be that guy, but we could really use another car and we've rented from Hertz before. The rental was pristine, ran very well, it was so nice we really didn't want to go back to our old car. lol If the price is right, I'll take advantage.

Well, if you’re in the market, Hertz is selling a number of special edition high-performance Chevrolet Z06 Corvettes for “fire sale” prices.

www.autoweek.com...

I suspect the Big 3 automakers are going to feel some pain too... I know a huge part of Ford and GM's sales are fleet vehicles to rental car companies. No one other than blue hairs and rental car companies buy some of their models.