After laying off at least 400 workers at its Oklahoma City operations in April, Hertz has gone to bankruptcy court.
Hertz Global Holdings Inc. filed for bankruptcy in Delaware on Friday after travel restrictions and the global economic collapsed caused by the coronavirus pandemic crushed demand for the company’s rental cars.
The Chapter 11 filing allows Hertz to keep operating while it devises a plan to pay its creditors and turn around the business. The action includes the company’s U.S. and Canadian subsidiaries, but doesn’t cover Europe, Australia and New Zealand, according to a statement Friday evening.
Hertz said it had $1 billion in cash to support its operations, which include Hertz, Dollar, Thrifty, Firefly, Hertz Car Sales, and Donlen. But it might need to raise more, perhaps through added borrowings while the bankruptcy process moves forward, Hertz said.
The warning signs came last month when Hertz laid off 415 workers at its Oklahoma City operations.
In a WARN alert sent in April by spokeswoman Karen Gittleman of Hertz to the Oklahoma Office of Workforce Development, the layoffs were blamed on the pandemic.
“The COVID-19 public health crisis continues to have a profound and sustained adverse impact on the global economy in general and the rental car industry specifically. The rapid and drastic
decline in travel volumes due to COVID-19, have caused car rental bookings to fall off dramatically, causing unforeseen business circumstances that were not reasonably foreseeable at
the time that notice may have been required under the federal Worker Adjustment Retraining Notification Act.”