Rental-car companies struggling to survive the coronavirus pandemic’s catastrophic blow to their business have been working with automakers to call off purchases, in some cases even redirecting vehicles in transit to their now largely neglected parking lots.
General Motors Co. is taking back cars it agreed to sell that were on their way toHertz Global Holdings Inc.,Avis Budget Group Inc. and closely heldEnterprise Holdings Inc., a spokesman said.Hyundai Motor Co. also confirmed it has redirected some vehicles to its retailers that it was planning to produce for fleet customers.
Early last month,Fiat Chrysler Automobiles NV compiled a list of almost 30,000 vehicles the rental-car companies had purchased and circulated it to other prospective fleet customers, according to a person who shared the document with Bloomberg News. The attempt to transfer any of the cars to other customers ultimately fell through for logistical reasons, a Fiat Chrysler spokesman said.
The effort by the automakers to help the companies shrink their fleets captures just how dire the rental business is amid shutdown orders that have clobbered the travel industry. Hertz’s lenders granted aneleventh-hour reprieve from a potential bankruptcy on Tuesday, while Avis sold$500 million of high-interest junk bonds to weather what it expects to be back-to-back months of revenue plummeting 80%.
23,976 in U.S.Most new cases today
-16% Change in MSCI World Index of global stocks since Wuhan lockdown, Jan. 23
-1.018 Change in U.S. treasury bond yield since Wuhan lockdown, Jan. 23
-4.8% Global GDP Tracker (annualized), April