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Coronavirus: Hertz declares bankruptcy in North America

2020-05-23T06:20:07.250Z

The hundred-year-old car rental company, which saw its 700,000 vehicles immobilized, had already dismissed two thirds of its employees in the States



The American car rental company Hertz, created in 1918 and known throughout the world, placed itself Friday night under the American regime of bankruptcies, decimated by the pandemic of new coronavirus. "The impact of Covid-19 on travel demand has been sudden and dramatic, resulting in a sharp drop in company revenues and future bookings," the group said in a statement.

This procedure, which should allow the company to reorganize its financial structure and avoid liquidation, currently concerns only its operations in the United States, very badly affected by the pandemic, and in Canada. It spares Europe, Australia and New Zealand, its main operational regions.

If rental activities have resumed partially with the deconfinement of several parts of the globe, "the uncertainty remains as to the return of revenues and the complete reopening of the market […] which required today's action" , adds the company. The resumption of activity is difficult to estimate and the business clientele of the lessor has largely started teleworking.

10,000 jobs cut in North America

Hertz, backed by billionaire investor Carl Icahn, operates the car rental brands Hertz, Dollar and Thrifty, missed a loan repayment last week. On Monday, it appointed a new CEO, Paul Stone, who asked the lenders to extend the payment deadline until May 22. In vain.

On April 21, Hertz had already announced that it would cut 10,000 jobs in North America, or 26.3% of its global workforce, to save money in the face of the uncertainties caused by the pandemic. Tonight, the group said it had actually laid off 20,000 people in total, out of 29,000 employees employed at the end of 2019 in the United States, and 38,000 worldwide.

Hertz did not mention the amount of its debt, but the Wall Street Journal and Reuters reported Friday evening a debt of about $ 19 billion and nearly 700,000 vehicles largely unused because of the coronavirus.

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2020, however, had started well for the Estero, Florida-based holding company: after four consecutive years of losses, in a very competitive sector, turnover had jumped by 6 and 8% in January and February.

Source: leparis

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