Meanwhile, the surge in demand from consumers — for both retail and rental vehicles — has led to a rising value for bankrupt Hertz Global Holdings. The company’s shares were trading at 66 cents on March 4 and closed at $6.80 on Friday, May 14.
Last week, after a competitive bidding process, Hertz picked Knighthead Capital Management and Certares Management to buy the company out of bankruptcy.
Hertz, too, noted in an email a surge in demand for leisure travel throughout the U.S. amid limited availability for rental cars. The company in November secured $4 billion in financing to help shore up its vehicle fleet.
“Hertz is supplementing our fleet by purchasing low-mileage, pre-owned vehicles from a variety of channels, including auctions, online auctions, dealerships and cars coming off lease programs,” Lauren Luster, director of communications, said in an email. “We’re buying a variety of makes and models, including many small and midsize SUVs, which continue to be in high demand for rental customers.”
John Healy, an analyst with Northcoast Research, said he does not expect Hertz’s bankruptcy, at this stage, to be a big factor in the used-vehicle market.
“Typically, rental-car companies impact the used-car market when they’re selling cars,” he said. “Right now, you’re actually seeing the opposite.”
Healy said rental-car companies will typically sell more vehicles in the fall, but the way things are going, he doesn’t see that happening.
The rental-car market returning to normal will depend a lot on automakers producing more cars and trucks.