Now That Hertz Is Bankrupt Will The Used Car Market Be Flooded With Unwanted Vehicles?

Hertz, the ubiquitous rental car company that's a fixture of airports all over the world, filed for bankruptcy protection on Friday, citing a severe decline in business thanks to the COVID-19 pandemic and the economic downturn that it caused.

The Florida-based company announced it would seek Chapter 11 bankruptcy protection on Friday, seeking to not go out of business entirely but to reorganize. It will continue to do business in the interim, using $1 billion in cash on hand to honor bookings, vouchers and more.

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PUGPROUD - 5/25/2020 4:16:59 PM

-1 Boost

Still a chance Hertz will be restructured or bought out by the largest European rental car company.

Car4life1 - 5/25/2020 5:15:21 PM

+3 Boost

Unless the world’s largest rental car company beats them to it, St.Louis based Enterprise Rent A Car, however I think Hertz can do some restructuring and climb its way back to good health, unless it’s in deeper debt & trouble than we know.

With unemployment and record levels and companies downsizing and substituting technology for travel, it may be harder for them to rebound than expected.

Airlines are now turning to shipping to cope with losses, Rental car companies should explore ways to partner with the likes of Uber/Lyft to offset some losses

MDarringer - 5/25/2020 5:03:52 PM

-1 Boost

A business going bankrupt can sometimes be a real financial break for them.

If there is a flood of rental cars, the price of late model rental cars as used will collapse the prices possible in the used car market, but the big losers will be customers wanting to trade in because their cars are likely to be valued lower than the rentals.