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I had a rental that I was trying to return 2 weeks ago and it was almost impossible. The Hertz office I rented it from was shut down so I started calling every one by my house just to have my calls forwarded to corporate. I talked to corporate and they continued to give me address of places that were closed. They had no idea what was going on. I finally got through to one and they said bring it down. It was a long drive and a PITA. Then when I got there I had to make sure the tank was topped off as I got it or they were going to charge $9.99 a gallon to fill it. I burned a couple gallons just getting it to them on my dime.
 

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Wow, sounds like a company that is wrapping things up and isn't going to be around much longer.

B.
 

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A few weeks ago I saw an overhead view of the Dodger Stadium parking lot. The lot was essentually full of rental cars since LAX and Burbank AP had no room to park them.
I'm obviously no economist but I'm interested in how this plays out. I believe I read where Hertz "ownes" about 400,000 cars. At some point their lender is going to get nervious and start dumping rental cars on the used car market. The effect on the values of run of the mill used cars is going to be something to watch.
 

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This action by Hertz will have a "ripple" effect.

As noted, they will start dumping their inventory.

They will reduce/cancel orders for new cars.

Car mfg companies will roll back production.

Companies that supply new parts to the car mfg will see a drop in demand.

And the list goes on !!! - airlines; gas producers; retail car parts; car repair shops, etc.
 

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They are storing a ton of rentals at nearby Santa Anita Park, a parking lot that horse racing can't fill anymore, coronavirus or not. Ripple effect is right: a flooded used car market, people having to hold onto their used cars longer might make it good for the auto salvage and repair industries. But carmakers will be hurting.

That said, we must remind ourselves that bankruptcy can mean the end of a company or it can mean a restructuring. Chrysler has gone bankrupt and come back, and a number of other companies have come back including Lehman Brothers. It doesn't bode well, but it isn't exactly the death knell it used to be.
 

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That said, we must remind ourselves that bankruptcy can mean the end of a company or it can mean a restructuring. Chrysler has gone bankrupt and come back, and a number of other companies have come back including Lehman Brothers. It doesn't bode well, but it isn't exactly the death knell it used to be.
I agree, Frank, but it's really difficult to put a restructuring plan together when you have no idea when your business will even get back close to normal. The acres of rental car storage in most cases isn't free. Airports are charging airlines for aircraft storage parking and rental car companies for fields of car storage. I'm sure off airport storage is also being paid for. The bills just keep on coming with almost a non existent revenue stream. As Lou mentioned, this will have a ripple effect right down to the car manufacturers who rely on rental car companies for huge segments of their production. This is going to be interesting, if not painful, to watch in the coming weeks and months.

Bob
 
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