Hertz was one of the most recent victims of the coronavirus pandemic. After missing payments on some of their debts, the rental car company has filed for bankruptcy. Oftentimes, people jump on these opportunities, assuming they will get a great deal from a desperate company. As a result, we ask the question: Is this a chance for a great used car deal? Most rental car companies sell their inventory after a certain number of miles, and for prices that seem pretty competitive. So, are those prices going to drop even lower due to the financial woes of Hertz? Here to take an educated guess is Scotty Kilmer, a popular mechanic and YouTuber with a lot of industry knowledge. This video touches on a few different subjects, but the first 4 minutes are dedicated to the bankruptcy filings of Hertz rental cars.
In Summary
As Scotty mentioned, the answer is probably no. While desperate times can call for desperate measures, this situation isn’t ripe for lower pricing. Since their bankruptcy means they obviously were struggling to pay their bills, they likely aren’t looking to lose money on cars. The coronavirus pandemic caused a major downturn in tourism, ravaging their rental income. As a result, they are relying more heavily on their secondary income source: used car sales. Now is not the time for them to be shrinking margins on this revenue stream, so you should probably hold off.
The lack of special deals aren’t the only reason one should hold off buying a rental car. There are many other issues that make rental car deals less appealing. While their prices are enticing, it is usually because of the reputation rental cars carry. For good reason, rental cars are seen as vehicle that are driven hard by people who don’t care about them. think about it, how careful are you when it comes to slamming the gas pedal on your rentals? For most, long-term health of the vehicle really doesn’t come to mind, at least not as much as it does with their own cars. They also receive bare minimum maintenance, and go through pretty weak inspection processes. This makes buying a rental car an especially risky gamble; one with not much of an upside when price is considered anyway.
Trey LaRocca is a freelance writer, financial sales worker, and tech guy. When he isn’t out and about or at work, he’s usually at home enjoying some video games and a beer. Currently residing in Newport Beach, this California Kid can be found at the beach on any given weekend. Trey has years of experience in day/swing trading, financial analytics, and sales.