Hertz USA files for bankruptcy

Posted by Anita Froneman on 25 May 2020

Car rental agency Hertz Global filed for bankruptcy in America on Friday 23 May. This is a direct result of a drastic decrease in the demand for rental cars due to COVID-19.

‘With the severity of the Covid-19 impact on our business, and the uncertainty of when travel and the economy will rebound, we need to take further steps to weather a potentially prolonged recovery,’ Paul Stone, Hertz’s chief executive officer, said in a statement.

The company is seeking Chapter 11 protection in a US bankruptcy court. The American Car Rental Association, a trade group representing Hertz, has asked Congress to do more for the industry by expanding coronavirus relief efforts, according to EWN.

‘Hertz South Africa is open for business’, the company says on its website. Most car rental services accommodate essential service workers during the lockdown period. The whole travel industry has been hit hard and no tourist operations are allowed to resume yet even when the country moves to Level 3 of lockdown on June 1.

On Sunday [May 24], President Cyril Ramaphosa said during his national address that government has held discussions with the tourism, hotel and restaurant industry regarding the challenges and hardships these sectors are experiencing.

‘They have made several proposals, regarding the measures they intend to put in place when their sectors are opened. We are giving consideration to the proposals,’ said Ramaphosa. The tourism sector is holding on to these hopeful words until they know more.

Image credit: Unsplash



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