Moderators: richierich, ua900, hOMSaR

 
frmrCapCadet
Topic Author
Posts: 3990
Joined: Thu May 29, 2008 8:24 pm

Updated: Hertz files for bankruptcy

Sat May 23, 2020 2:35 am

https://www.businessinsider.com/hertz-f ... ort-2020-5

My cynical view of the business: It is a phony business, that is it is not about renting cars and making it a pleasant experience. They buy new cars in bulk and then sell them several thousand miles later. Meantime to nickel and dime (actually hundreds of $$$ over various phony fees, damage charges, insurance etc) anything to make the experience exploitative. Properly built cars last for 2-3 hundred thousand miles. The capital expenses should fade into a fairly insignificant part of the business. Damages and loss of rental time are charged many-times over actual expenses of repair and times to repair. Logically shiny new cars should rent for more than 3-10 year old cars. The later a better buy for those of us who would like lower prices. I have never wanted to 'rent a wreck', but have no problems with renting a reliable car with a few dings and signs of wear.
Last edited by SQ22 on Sun May 24, 2020 5:49 am, edited 1 time in total.
Reason: Title updated
Buffet: the airline business...has eaten up capital...like..no other (business)
 
ltbewr
Posts: 15007
Joined: Thu Jan 29, 2004 1:24 pm

Re: Hertz Likely to File for Bankruptcy

Sat May 23, 2020 3:07 am

Hertz, like too many companies, is saddled with way too much debt that greedy investors put them into for short-term profits and fees taking them 'private', along with a flawed business model and competition, so when the disaster of Covid-19 pandemic hit, they had no reserves to try to survive on. Many other companies in consumer retail, tourism, and of course airlines, all are suffering in part from the debts of rip-off investors, bad business models, competition so cutting parts of their business, locations, and to Bankruptcy.
 
frmrCapCadet
Topic Author
Posts: 3990
Joined: Thu May 29, 2008 8:24 pm

Re: Hertz Likely to File for Bankruptcy

Sat May 23, 2020 4:11 am

Buffet: the airline business...has eaten up capital...like..no other (business)
 
Kent350787
Posts: 1236
Joined: Wed May 28, 2008 12:06 am

Re: Hertz Likely to File for Bankruptcy

Sat May 23, 2020 4:24 am

Not clear fomr that link - is this Chapter 11?

I've got a little status with Hertz, but oh well. you'd expect restructuring to screw over staff and franchisees will see them come back.
S340/J31/146-300/F27/F50/Nord 262/Q100/200/E195/733/734/738/744/762/763/77W/788/789/320/321/332/333/345/359
 
blueflyer
Posts: 4352
Joined: Tue Jan 31, 2006 4:17 am

Re: Hertz Likely to File for Bankruptcy

Sat May 23, 2020 5:11 am

Hertz was hit with a quadruple whammy:
- A policy of acquiring a much larger portion of their fleet rather than leasing them compared to the competition left them exposed to a higher debt burden to finance their fleet;
- They (will) have to take significant write-downs on the value of their owned fleet as the market for used cars will be declining if it is not already;
- Trying to gain market share by using aggressive pricing (offering retail pricing through corporate booking engines matching or beating contracted pricing from other providers);
- Not a lot of gain/synergies to show for their expensive acquisition of Dollar Thrifty

frmrCapCadet wrote:
https://www.businessinsider.com/hertz-filing-for-bankruptcy-as-early-as-this-weekend-report-2020-5

My cynical view of the business: It is a phony business, that is it is not about renting cars and making it a pleasant experience. They buy new cars in bulk and then sell them several thousand miles later. Meantime to nickel and dime (actually hundreds of $$$ over various phony fees, damage charges, insurance etc) anything to make the experience exploitative.

Not sure whether this is your view of the car rental industry as a whole or Hertz?
Hertz is the only one buying cars in bulk to a significant extent. Most companies lease the large majority of their fleet for a designated period and number of miles, and return them to the lessor at the end of the contract.
As for nickel and diming, I suspect that impression is based on individual experiences, and mine is that is very much a thing of the past with Avis, Hertz, and Sixt where I rented enough cars per year pre-Covid to reach one of the higher tiers in their respective frequent renter programs. I can't remember the last time I was charged for any damage, as to fees, the only one I pay is at the time of pickup to skip having to refuel before returning the car.

ltbewr wrote:
Hertz, like too many companies, is saddled with way too much debt that greedy investors put them into for short-term profits and fees taking them 'private', along with a flawed business model and competition, so when the disaster of Covid-19 pandemic hit, they had no reserves to try to survive on. Many other companies in consumer retail, tourism, and of course airlines, all are suffering in part from the debts of rip-off investors, bad business models, competition so cutting parts of their business, locations, and to Bankruptcy.

Hertz is publicly-traded, it is not privately held.
 
frmrCapCadet
Topic Author
Posts: 3990
Joined: Thu May 29, 2008 8:24 pm

Re: Hertz Likely to File for Bankruptcy

Sat May 23, 2020 1:04 pm

Actually my limited experience with car rentals has been good. My question of their business model is why buy new, pay for the first three expensive years of depreciation, and then sell the car. The real value of a car is in years 3-10 (maybe 8 for higher usage). They also would become masters of maintenance - seller beware - they have experience and don't need to buy poor products (or overly expensive, hard to get parts). Or to put it in other terms, their model seems more about buying and selling cars than renting them. Someone's observations from inside the business would obviously be interesting to me.

There should be, but never is, a handout about lights, wipers, heat, defrost and air conditioners, refueling, cruise control for the actual model one rents. One or two pages would do.
Buffet: the airline business...has eaten up capital...like..no other (business)
 
GDB
Posts: 13615
Joined: Wed May 23, 2001 6:25 pm

Re: Hertz Likely to File for Bankruptcy

Sat May 23, 2020 1:56 pm

Call me ignorant but wasn't Hertz Van Rental a Dutch painter?
 
GalaxyFlyer
Posts: 5463
Joined: Fri Jan 01, 2016 4:44 am

Re: Hertz Likely to File for Bankruptcy

Sat May 23, 2020 3:14 pm

frmrCapCadet wrote:
Actually my limited experience with car rentals has been good. My question of their business model is why buy new, pay for the first three expensive years of depreciation, and then sell the car. The real value of a car is in years 3-10 (maybe 8 for higher usage). They also would become masters of maintenance - seller beware - they have experience and don't need to buy poor products (or overly expensive, hard to get parts). Or to put it in other terms, their model seems more about buying and selling cars than renting them. Someone's observations from inside the business would obviously be interesting to me.

There should be, but never is, a handout about lights, wipers, heat, defrost and air conditioners, refueling, cruise control for the actual model one rents. One or two pages would do.


How hard is it to figure out a modern car?
 
mmo
Posts: 2014
Joined: Thu Apr 18, 2013 3:04 pm

Re: Hertz Likely to File for Bankruptcy

Sat May 23, 2020 3:35 pm

GalaxyFlyer wrote:
How hard is it to figure out a modern car?


Apparently, very hard!!
If we weren't all crazy we'd all go insane!
 
frmrCapCadet
Topic Author
Posts: 3990
Joined: Thu May 29, 2008 8:24 pm

Re: Hertz Likely to File for Bankruptcy

Sat May 23, 2020 3:54 pm

Actually it can be a bear to figure out a newer car. My RAV4 automatic features, many optional, are poorly documented in the manual. It is a headache to figure out just what options you have. My able salesman was not a master of my actual specimen. I finally figured out the sales slip itemization was the only reliable guide. Gas opener tab at left knee is poorly identified. As is about everything else. Indicator lights for various auto-driving features are not on or near the often multiple controls for that feature. I need to keep track of buttons at left knee, right center panel, both sides of steering wheel, some controls on the dash display, others on the center display. My son drives a Tesla, he just gets in and uses it. I like all of the features of my RAV, but nothing is integrated, just one god awful clusterf***.
Buffet: the airline business...has eaten up capital...like..no other (business)
 
User avatar
Aesma
Posts: 12936
Joined: Sat Nov 14, 2009 6:14 am

Re: Hertz Likely to File for Bankruptcy

Sat May 23, 2020 4:07 pm

I'm not a big renter, the last two times was with Hertz. My workplace has a franchisee directly inside the office building. Once I took a car from there for work reasons (just before I got my own company car), no issues. They didn't try to sell me anything and I didn't need to fill it up either, everything must be standardized between them and my company.

The other was recently for a trip in California. I had booked a large SUV but the guy tried to give me a minivan. I didn't budge and got a Tahoe. I wasn't given any instruction. I usually drive French, manual cars, so there were things I didn't know, I was also surprised that there was no navigation software (but there was android auto so that was fine). I figured out everything I needed, I was just surprised once when the collision avoidance system flashed red ! I was with my mother and sister, both have their driving license, but felt they couldn't handle the car...
New Technology is the name we give to stuff that doesn't work yet. Douglas Adams
 
IH8BY
Posts: 772
Joined: Tue Jun 28, 2005 5:39 pm

Re: Hertz Likely to File for Bankruptcy

Sat May 23, 2020 5:12 pm

In the UK there are a few rental companies which are amongst the biggest remarketers of cars in the wholesale market - it's almost as important a part of their business as the rental aspect, and the purchase at their risk offers them the chance to flex the time the vehicles spend on fleet so a) they can respond to fleet utilisation and b) they can dynamically plan when they're going to remarket the car to maximise the return.

GalaxyFlyer wrote:
frmrCapCadet wrote:
Actually my limited experience with car rentals has been good. My question of their business model is why buy new, pay for the first three expensive years of depreciation, and then sell the car. The real value of a car is in years 3-10 (maybe 8 for higher usage). They also would become masters of maintenance - seller beware - they have experience and don't need to buy poor products (or overly expensive, hard to get parts). Or to put it in other terms, their model seems more about buying and selling cars than renting them. Someone's observations from inside the business would obviously be interesting to me.

There should be, but never is, a handout about lights, wipers, heat, defrost and air conditioners, refueling, cruise control for the actual model one rents. One or two pages would do.


How hard is it to figure out a modern car?


The challenge is always that you can't put handouts into the cars because you would have to provide one for every single rental, every time, creating an admin and process headache (basically, the unfortunate rule is, if it's in the car, and it's not fixed down, you have to assume it will go missing sooner or later...). Better to have adequate staff training so the employees know how the cars work and can help customers if needed. I would always make sure that after I sold rental companies a new model that they had a demo sent to the head office for a decent time so training could be done and cascaded to rental stations. I wanted the people driving the car to get a chance to enjoy it. For a manufacturer it's potentially an unexpected test drive opportunity so of course you want the renter to get the best possible experience.

Modern cars have more features, and also more settings and secondary controls are accessed via touchscreens - they're not necessarily difficult to use, but each brand has its own setup. Even seemingly standard features like electronic parking brakes or keyless entry/start vary in operation between brands. Equally some are more complicated than others; you could get to the end of the rental and not know whether or not the car had navigation, for example. These are the things a dealer explains to a private customer when they hand over their new car, or that you simply pick up over the time you have a car. You often don't have the opportunity when you rent one for a few days.
Have you ever felt like you could float into the sky / like the laws of physics simply don't apply?
 
NIKV69
Posts: 13365
Joined: Wed Jan 28, 2004 4:27 am

Re: Hertz Likely to File for Bankruptcy

Sat May 23, 2020 6:01 pm

Hertz was always way too pricey. Great service but Avis does me much better for much less the cost. Oh well.
I am the Googlizer!!!
 
airtechy
Posts: 753
Joined: Sun Dec 24, 2006 7:35 am

Re: Hertz Likely to File for Bankruptcy

Sat May 23, 2020 6:57 pm

Maybe they need to rehire OJ to run through airports.
 
KFLLCFII
Posts: 3544
Joined: Sat Sep 11, 2004 7:08 am

Re: Hertz Likely to File for Bankruptcy

Sat May 23, 2020 9:29 pm

airtechy wrote:
Maybe they need to rehire OJ to run through airports.


LAX and ORD?
"About the only way to look at it, just a pity you are not POTUS KFLLCFII, seems as if we would all be better off."
 
ltbewr
Posts: 15007
Joined: Thu Jan 29, 2004 1:24 pm

Re: Hertz Likely to File for Bankruptcy

Sat May 23, 2020 9:36 pm

KFLLCFII wrote:
airtechy wrote:
Maybe they need to rehire OJ to run through airports.


LAX and ORD?

Actually one of ads was filmed at EWR when it was still relatively new.
 
GalaxyFlyer
Posts: 5463
Joined: Fri Jan 01, 2016 4:44 am

Re: Hertz Likely to File for Bankruptcy

Sat May 23, 2020 9:57 pm

frmrCapCadet wrote:
Actually it can be a bear to figure out a newer car. My RAV4 automatic features, many optional, are poorly documented in the manual. It is a headache to figure out just what options you have. My able salesman was not a master of my actual specimen. I finally figured out the sales slip itemization was the only reliable guide. Gas opener tab at left knee is poorly identified. As is about everything else. Indicator lights for various auto-driving features are not on or near the often multiple controls for that feature. I need to keep track of buttons at left knee, right center panel, both sides of steering wheel, some controls on the dash display, others on the center display. My son drives a Tesla, he just gets in and uses it. I like all of the features of my RAV, but nothing is integrated, just one god awful clusterf***.


The gas cap door is always a mystery! Ugh! The rest I don’t bother with, gas, brakes, mirrors, turn signals, lights and maybe radio, I’m good to go. I’d easily pay to remove all the electronic auto driving crap. I had Sixt VW in Zurich once, F/A finally figured out how to change from German to English half way to Pilatus. I had an idea for a map. Most of new electronic crap on cars should be optional or delete options.
 
Ken777
Posts: 10034
Joined: Thu Mar 11, 2004 5:39 am

Re: Hertz Likely to File for Bankruptcy

Sat May 23, 2020 11:05 pm

I have long concerned with the way today's corporations have been run. Too much concern with boosting bonuses for the executive office for the executive office and none for long term protection of cash positions. Few companies (like Apple) have the cash holdings that offer long term protection, and well as funds for growth.

Maybe Hertz execs should be required to repay their bonus payments over the past 5 years.
 
User avatar
hawaiian717
Posts: 3447
Joined: Tue May 18, 1999 2:46 am

Re: Hertz Likely to File for Bankruptcy

Tue May 26, 2020 2:36 pm

blueflyer wrote:
Hertz is publicly-traded, it is not privately held.


It was taken private in 2005 after being sold to a consortium of private equity firms in 2005, relisted the following year, and the proceeds from the IPO used to pay back "loans" from the consortium.

Aesma wrote:
I usually drive French, manual cars, so there were things I didn't know, I was also surprised that there was no navigation software (but there was android auto so that was fine).


Hertz has for several years offered an add-on navigation unit with an additional charge, so its not too surprising that their vehicles wouldn't come with the manufacturer's navigation system (especially when its often an extra-charge option).
 
blueflyer
Posts: 4352
Joined: Tue Jan 31, 2006 4:17 am

Re: Hertz Likely to File for Bankruptcy

Tue May 26, 2020 4:16 pm

GalaxyFlyer wrote:
How hard is it to figure out a modern car?

Depends what you want out of it.... Clearly there are manufacturers that took the approach since dealers provide training nowadays, there's no need to make access to Bluetooth and car settings intuitive! When I have a long drive ahead of me, I am going to customize the settings to my liking, whether it is Bluetooth, (satellite) radio, GPS, intelligent driver's aids, etc. I've rented enough cars to be able to do it in a cinch on some brands and think "oh god not again" for others...

Aesma wrote:
I was also surprised that there was no navigation software (but there was android auto so that was fine).

GPS is an add-on for all but the premium categories (think fully loaded Jaguar, Infiniti, etc.)

NIKV69 wrote:
Hertz was always way too pricey. Great service but Avis does me much better for much less the cost. Oh well.

Very interesting how different individual experiences can be. I happen to think Hertz does much better on service than Avis does, and for domestic rentals, is actually cheaper, to the point that I can book from Hertz for less than our corporate rate for a similar vehicle with Avis. When it comes to renting outside the US, on the other hand, I do agree that Hertz is significantly pricier. I either book a lower category and rely on my status upgrade, or go to Sixt...
 
stlgph
Posts: 11195
Joined: Tue Oct 12, 2004 4:19 pm

Re: Updated: Hertz files for bankruptcy

Tue May 26, 2020 8:22 pm

It Hertz that it's a National trend that no one wants to Enterprise AVISit to the Alamo because they see the Advantage of being really Thrifty at spending their Dollar and keeping to their budget all while hoping to Payless.
if assumptions could fly, airliners.net would be the world's busiest airport
 
User avatar
Aesma
Posts: 12936
Joined: Sat Nov 14, 2009 6:14 am

Re: Hertz Likely to File for Bankruptcy

Wed May 27, 2020 3:25 am

hawaiian717 wrote:
Hertz has for several years offered an add-on navigation unit with an additional charge, so its not too surprising that their vehicles wouldn't come with the manufacturer's navigation system (especially when its often an extra-charge option).


Yeah when you have all the hardware there (big screen, GPS antenna), it's a bit ridiculous to use an add-on. And the price of the option was outrageous, something like 200$.
New Technology is the name we give to stuff that doesn't work yet. Douglas Adams
 
User avatar
readytotaxi
Posts: 7261
Joined: Mon Dec 11, 2006 2:09 am

Re: Updated: Hertz files for bankruptcy

Wed May 27, 2020 8:49 am

How is Avis-Budget holding up in the US, possible they might follow?
you don't get a second chance to make a first impression!
Growing older, but not up.
 
ltbewr
Posts: 15007
Joined: Thu Jan 29, 2004 1:24 pm

Re: Updated: Hertz files for bankruptcy

Wed May 27, 2020 12:17 pm

readytotaxi wrote:
How is Avis-Budget holding up in the US, possible they might follow?

Apparently the business and financial structure of Hertz, as other posters noted, put it into a position where bankruptcy was the only option. Some of the other companies have different financial structures, have a higher percentage of business with leasing, especially with commercial vehicles instead of short term business and leisure rentals, Still I would expect some smaller companies, especially those mainly in the leisure travel markets to be in very bad positions and possibly go into bankruptcy as the Covid-19 pandemic continues. Recall the pictures last month of 1000's of cars parked on a grass lot in Florida near an airport that went up in flames from a fire and massive numbers of rental cars are stored in lots all over the world due to the crash in demand.

Who is online

Users browsing this forum: johns624, Kiwirob and 42 guests

Popular Searches On Airliners.net

Top Photos of Last:   24 Hours  •  48 Hours  •  7 Days  •  30 Days  •  180 Days  •  365 Days  •  All Time

Military Aircraft Every type from fighters to helicopters from air forces around the globe

Classic Airliners Props and jets from the good old days

Flight Decks Views from inside the cockpit

Aircraft Cabins Passenger cabin shots showing seat arrangements as well as cargo aircraft interior

Cargo Aircraft Pictures of great freighter aircraft

Government Aircraft Aircraft flying government officials

Helicopters Our large helicopter section. Both military and civil versions

Blimps / Airships Everything from the Goodyear blimp to the Zeppelin

Night Photos Beautiful shots taken while the sun is below the horizon

Accidents Accident, incident and crash related photos

Air to Air Photos taken by airborne photographers of airborne aircraft

Special Paint Schemes Aircraft painted in beautiful and original liveries

Airport Overviews Airport overviews from the air or ground

Tails and Winglets Tail and Winglet closeups with beautiful airline logos