You might have heard the news that the car rental giant Hertz has filed for Chapter 11 bankruptcy in the United States, but this doesn’t mean that it will cease operating.
The 102-year-old company revealed that it has more than £15.3 billion of debt and only around £820 million in cash.
The filing in the U.S. includes some of its subsidiaries.
However, its operations in Europe, Australia and New Zealand are not affected, neither are its franchised locations.
All of Hertz’s businesses globally, including its Hertz, Dollar, Thrifty, Firefly, Hertz Car Sales, and Donlen subsidiaries, will continue to trade. This includes the 400-plus outlets in the UK and Ireland.
In a statement, Hertz said: “The financial reorganisation will provide Hertz a path toward a more robust financial structure that best positions the company for the future as it navigates what could be a prolonged travel and overall global economic recovery.”
Chapter 11 bankruptcy in the U.S. is a mechanism companies use to buy some breathing time to re-organise. It means that creditors aren’t able to pursue their debt for a certain period of time, saving the company from collapse. Many large companies in the U.S. have filed for Chapter 11 bankruptcy and continued to trade successfully.
What about your loyalty points?
If you’re a member of Hertz’ loyalty club and you have a stash of Gold Plus Rewards you should still be able to redeem them with car hire with Hertz when travel restrictions are lifted.
Hertz said: “All reservations, promotional offers, vouchers, and customer and loyalty programs, including rewards points, are expected to continue as usual. Customers can count on the same high level of service and reliability, including new initiatives such as ‘Hertz Gold Standard Clean’ sanitization protocols to provide additional safety in response to the COVID-19 pandemic.”
As part of its restructure Hertz, which operates mainly at international airports, will consolidate its off-airport rental locations.