Car rental giant Hertz Global Holdings announced on May 22, it and multiple subsidiaries had filed for Chapter 11 bankruptcy protection in a U.S. Delaware Bankruptcy Court.
The U.S Bankruptcy Court in Wilmington, Delaware, approved an agreement Friday to give lenders cash rent on the cars Hertz is keeping, while Hertz gets the right to slash its fleet by more than 182,000 vehicles, as well as decrease its debt. The $650 million deal went through last week and will save them roughly $80 million a month.
A rise in the price of used-cars enabled Hertz Global Holdings, Inc. to make the deal that will hold the company’s lenders at bay until the end of the year. Hertz is trying to gain some time to see how much longer the pandemic crisis will punish the travel industry.
Just a few days before the bankruptcy filing Hertz Global announced the resignation of CEO Kathryn Marinello. Executive Vice President Paul Stone has stepped in, taking the helm of the company.
Stone announced the bankruptcy citing the Covid-19 crisis as the reason for 102-year-old rental car giants’ actions.
