Two corporations based in North America have filed for Bankruptcy Protection. One claim focused on the American Government, with the second claim made with the Canadian Government. The 1st claim for Bankruptcy Protection comes from Hertz, a Car Rental Company that noted their income has dropped below 0%. This follows after the COVID-19 pandemic forced all bookings of their vehicles to be cancelled.
Considering a large percentage of their profits come from Cars and Trucks being rented at airports, it’s not surprising their earnings have dropped drastically in North America. This extends towards their global operations as well, forcing Hertz to re-evaluate how debts are structured going forward. It’s expected that the Australian, Canadian, New Zealand, and European Divisions for Hertz will also claim for Bankruptcy Protection.
Business analysts speculate that Hertz won’t ultimately recover from the COVID-19 pandemic. They amassed billions in debt after applications like Uber and Lyft prompted profits to drop drastically. PR Representatives have claimed that management is working towards strategies that ensure the health & safety for customers. This will also benefit employees and allow profits to resume.
International travel will be considerably limited over the next five to ten years, forcing profit margins with Hertz to continue their downward spiral. The chances that they can recover from COVID-19 by obtaining quarterly profits while paying off their debt is low. Hertz will most likely be one of the hundreds that have to ultimately shutdown their large-scale corporations.
Reitman’s Canada Enters Bankruptcy
Another company that announced it’s seeking Bankruptcy Protection is Reitman’s Canada, a clothing retailer. They filed for the Protection with the Canadian Companies Creditors Arrangement Act. Judges with the Quebec Superior Court will govern over this claim, making their decision on if funds will be awarded to Reitman’s. Some analysts speculate that Bankruptcy Protection won’t be granted to their desired valuation. This follows after Reitman’s was deemed a Non-Essential Service to Canadians.
PR Representatives with Reitman’s Canada announced that they’d look into outside investors if Bankruptcy Protection isn’t provided. The Board of Directors & Executives is determined to resume business operations, even with new safety measures being imposed.