Hertz filed for Chapter 11 bankruptcy amid rising debt and a sharp drop in demand for rental cars during the coronavirus pandemic.
The company is the latest travel-related business to fall victim to the coronavirus, which has grounded travelers and tourists and led to a sharp drop in revenue.
“The impact of COVID-19 on travel demand was sudden and dramatic, causing an abrupt decline in the Company's revenue and future bookings," the company said in a statement. "Hertz took immediate actions to prioritize the health and safety of employees and customers, eliminate all non-essential spending and preserve liquidity.
“However, uncertainty remains as to when revenue will return and when the used-car market will fully re-open for sales, which necessitated today's action," it continued. "The financial reorganization 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 says it has over $1 billion cash on hand to keep its sites up and running while it undergoes the bankruptcy process.
“Today's action will protect the value of our business, allow us to continue our operations and serve our customers, and provide the time to put in place a new, stronger financial foundation to move successfully through this pandemic and to better position us for the future," said Hertz President and CEO Paul Stone. "Our loyal customers have made us one of the world's most iconic brands, and we look forward to serving them now and on their future journeys."
Entire sectors of the economy are going to be gone for good, taking tens of millions of jobs with them. And on the other side of that equation, because we refuse to subsidize universal childcare and because daycares are rightfully closed, millions of women are leaving the workforce to care for kids.
If day cares closed because of the novel coronavirus, Aimee Rae Hannaford expected her family to fare better than most. She worked full time as the chief executive of a tech company while her husband stayed home. He’d been taking some time off from his own tech career, managing a rental property while considering his options. He could look after their 3-year-old son, she thought — at least for a while.
“That lasted a grand total of three days,” Hannaford said.
Once her son was home full time, she realized they’d need a different solution. She was holed up in the guest room, wielding dual-monitors at her desk. Her husband was exhausted. “I can’t do it,” she remembers him saying: “I can’t watch him for this long.”
Hannaford, 46, had been logging 70-hour weeks for years — and she was proud of the work she’d done. When she started her career in San Francisco, she was one of two women at a video game company, buying nondescript jeans and hoodies so she could be “one of the guys.” Eventually she came to run a company she co-founded, building open-source websites for clients like Stanford University. Hannaford, who oversaw software development, co-led a diverse team of 13 employees. She was intentional about hiring women, minorities and others who challenged the stereotypes about Silicon Valley.
Hannaford had long been planning to take six weeks off. It would be a time free from computers and headphones, she’d promised her husband. She’d make bath bombs with her son and plant pumpkins in the backyard.
But it was never the right time. Her co-founder, busy with her own kids and aging parents, was able to help out less and less. Even outside work hours, Hannaford would field emails and take calls as her son, Ryan, climbed into her lap and tried to grab her phone. Her husband would plead with her to “get off the computer,” she said, teaching Ryan a trick to get her attention: When she wasn’t responding, her son would call her “Aimee” instead of “Mom.” (Hannaford’s husband declined to comment for this story.)
When the company lost a client because of the coronavirus, Hannaford realized she’d have to devote even more time to work. If she really pushed herself, she knew she could probably keep the company going even if day care closed. But could she ask her husband to handle 12-hour shifts of child care, with no help, no breaks and no clear end point? She wasn’t sure her family could survive that. She wasn’t sure he’d do it, even if she asked.
“I thought to myself, ‘I can carry this company forward, but I’m going to be so broken. My son will be so broken. My husband will be so broken.’ ”
Remember, it didn't have to be this way. But Donald Trump was in charge and he blew it, and Mitch McConnell won't lift a finger.
The front page of The New York Times for May 24, 2020 pic.twitter.com/Mp4figjnQe— The New York Times (@nytimes) May 23, 2020