Hertz Must Unload Thousands of Cars as Part of Bankruptcy

As part of its bankruptcy proceedings, rental car giant Hertz will have to offload nearly 200,000 cars by the end of this year, according to a recent U.S. Securities and Exchange Commission filing.

Hertz, which has a location in Pasadena, filed for bankruptcy in May and must dispose of at least 182,521 leased cars by Dec. 31, the filing reads.

This is part of a $650-million temporary deal the company made with a creditor group, reported The Wall Street Journal.

The deal requires Hertz to pay its asset-backed securities lenders $650 million of rent in equal installments per month from July to December.

Hertz will be allowed to retain $900 from each car it sells, according to The WSJ. The remainder will go toward repaying the lenders.

Used car sales have rebounded well during the COVID-19 pandemic while new-car sales are lagging.

In May, before the bankruptcy announcement, Business Insider reported that the rental car giant put more than 20 Chevrolet Corvette Z06s up for sale at steeply discounted prices. They all sold within days.