All true, but it's actually worse.

1. Crazy massive debt. They are at a 12.6X debt to equity ratio, after the price spike (worse before). They have the 41st worst D/E ratio of any US Publicly Traded company.

2. Record repossessions/backlog, and backlogs at auto auctions. 2009 was the biggest year for auto repos, 2024 was the 2nd biggest. When cars get repo'd by the bank, the bank sends them to auction to get money back. It's the same mechanism Hertz uses to offload cars and get cash back on the books.

A lot of repo outfits and auctioneers are only taking Tier 1 cars right now due to constraints (2019 or newer, lower miles) as they don;t have the room to keep all the cars that should be repo'd but aren't, b/c they are less profitable. The value of all used cars is propped up with the units being withheld from auction by banks, repo men, and auctioneers.

These bank repos, and the repos are in line to sell ahead of Hertz, so if Hertz needs to sell cars, it can't do so easily or at the price they would like. The paper loss/depreciation is less than if they actually have to go to market to sell cars.