The car rental company Hertz will file for bankruptcy
Hertz Global Holdings Inc. shares plunged nearly 24% on Monday after an article in the Wall Street Journal appeared.
According to The Wall Street Journal the car rental company had hired an additional consultant to help him draft an impending bankruptcy.
Hertz had been in a delicate situation for some time.
However, following the coronavirus pandemic, the company has seen demand drop dramatically in recent weeks. Car rental companies have traditionally generated two-thirds of their turnover from airports, yet airports worldwide are idling. Since February, the Hertz stock has lost 80% of its value.
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$ 17 billion in debt
The Wall Street Journal reported last month that Hertz had hired lawyers and business bankers as advisers as the company tried to renegotiate a mountain of $ 17 billion in debt.
A first default on part of this debt has since been recorded.
In recent months, Hertz and its competitor, Avis Budget Group, have both made salary cuts within their management. And in April, 10,000 employees were laid off at Hertz North America.
In recent years, car rental companies have lost many customers to platforms like Uber and Lyft. More and more travelers are opting for this type of service, especially near airports.
According to some experts interviewed by the Wall Street newspaper, there is little doubt that Hertz ‘will file for bankruptcy’.
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