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Ryanair is without car hire partner after Hertz gets the hump

M'learned friends are set to get involved as a war of words broke out between Ryanair and Hertz.

car
Ryanair passengers will have to hire a car from another rental firm to drive to the city they thought they had landed in

Low-cost airline Ryanair (LON:RYA) and car hire firm Hertz are getting a divorce.

Hertz was previously Ryanair's exclusive car hire partner but the US firm terminated the agreement with effect from midday today (Thursday), claiming that Ryanair's agreement with global distribution system (GDS) companies represents a breach of contract.

Ryanair disputes Hertz's allegation, saying that Ryanair has been distributing through GDSs (third party travel agents) since April 2014 with the full knowledge of Hertz.

In Ryanair's view, Hertz is the party in breach of contract and will be pursuing the US firm for damages over the ending of a contract that was set to run until 2020.

In the interim Ryanair will be unable to offer its customers car hire services through the Ryanair.com web site for a period of some three months while Ryanair seeks a suitable replacement supplier.

“We regret Hertz's decision to end our car hire agreement at such short notice today, at a time that will cause maximum inconvenience to our customers during the peak travel period. We have had a long and successful partnership with Hertz, and it's a pity that this has ended in such an unfortunate and untimely manner,” said Ryanair's boss, Michael O'Leary.

“Since we expect that any losses arising from this interruption to our car hire services will be recovered from our legal proceedings against Hertz, we do not expect this interruption to have a material impact on current earnings,” O'Leary said.

Shares in Ryanair were little changed in afternoon trading.

Quick facts: Ryanair Holdings plc

Price: 12.65 EUR

LSE:RYA
Market: LSE
Market Cap: €13.88 billion
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