Here's How Hertz Is Dealing With The Coronavirus Crisis
Zacks Investment Research | Mar 26, 2020 11:06PM ET
The coronavirus outbreak has ravaged the travel industry. Naturally, Hertz Global Holdings (NYSE:HTZ) , a car rental company based in Estero, FL, is taking a significant hit from the rapid fall in rental demand.
The company’s downturn started in March with surging rental cancellations and decreasing forward bookings as several countries went on lockdown and air-travel demand began plummeting.
How is Hertz Managing the Crisis?
Due to reduced travel demand, Hertz is adjusting its fleet levels by delaying new fleet deliveries as well as changing previous orders. The company is putting a check on operating and overhead costs and reducing capital expenditures significantly. Additionally, due to the drop in demand, it recently implemented employee furlough programs across its operations in North America and the United States. Once the downturn is over and travel demand recovers, the company expects to bring the staff back. In terms of payroll expenses, Hertz has significantly reduced senior leaders’ pays. Meanwhile, its CEO Marinello is foregoing her base salary entirely.
The company along with peers such as Avis Budget Group (NASDAQ:CAR) is seeking financial support from the U.S. and European governments to cope with this unprecedented crisis.
Amid this turmoil, shares of Hertz have declined 43.4% in a month’s time against the Zacks Investment Research
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