Century-old Hertz says New Zealand operations 'normal' as US business struggles

Saturday, 23 May 2020

Hertz rental cars have been operating for more than a century - but the company's US business is in trouble.

Rental car giant Hertz's request for bankruptcy protection in the US has no impact on Kiwi operations, the company's Asia-Pacific bosses say.

Facing what it called a sudden, dramatic slump in rental car demand and revenue due to coronavirus, Florida-based Hertz Global Holdings filed for bankruptcy protection in a Delaware court on Friday.

But New Zealand and Australian operations are not involved in that matter.

And Eoin Macneill, Hertz’s Asia-Pacific vice president, told Stuff Hertz was operating as normal in New Zealand.

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He said Hertz Global Holdings and some North American subsidiaries filed for reorganisation under what's known in the US as Chapter 11.

But he said that had 'no material impact on Hertz in Australia or New Zealand'.

Hertz has operated in New Zealand for decades, at places such as Christchurch Airport.

Macneill said the company's New Zealand locations were open.

Reservation, loyalty and customer programs were continuing, he said.

“Since the pandemic began, we have undertaken a range of measures to reduce costs and ensure we keep the business as robust as possible.

'We have cut all discretionary spending, reduced labour costs and sought new rental agreements with landlords.'

Macneill said Hertz had also been de-registering unused vehicles.

Hertz's franchised locations were also not included in the Chapter 11 proceedings.

The Wall Street Journal reported the 102-year-old company in the US was hoping to avoid a forced liquidation of its vehicle fleet.

'The company’s collapse marks one of the highest-profile corporate defaults stemming from the pandemic’s impact on air and ground travel,' the newspaper added.

But the Journal said Hertz faced challenges even before coronavirus.

These included competition from rivals including Avis Budget Group, and rideshare services such as Uber and Lyft Inc.

The company reportedly lost NZ$95 million last year, its fourth consecutive annual net loss.

'Hertz has spent years trying to restructure its business, and has blown through four chief executives in less than a decade,' the Journal added.

Hertz Global Holdings on Friday said it had more than $1 billion in cash on hand to support ongoing operations.

'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,' the company added.