Thrifty: Car delay
prompted Chap. 11
The local franchisee blames aBy Peter Wagner
dispute with the franchiser
A dispute over the delivery of 770 rental cars caused the Thrifty Car Rental franchise in Hawaii to fall into debt and file for Chapter 11 bankruptcy last month, the company's owner says.
Bradley Skinner, president of the company, yesterday said a dispute with mainland franchiser Tulsa, Okla.-based Thrifty Rent-A-Car Systems Inc. left him without a fleet of 1998 rental cars between March and November of last year.
"My difficulty in getting my fleet in a timely manner has been an ongoing problem," said Skinner, during a creditors' meeting in U.S. Bankruptcy Court yesterday.
He would not comment further on the unresolved conflict.
Yesterday's meeting, part of the Chapter 11 process, gave creditors an opportunity to question Skinner before a U.S. Trustee overseeing the bankruptcy case. Honolulu attorney Robert Faris, representing the franchiser, questioned Skinner's contention that Thrifty Rent-A-Car had a commitment to supply the cars.
Faris deferred questions on the conflict to company officials, who couldn't be reached.
Thrifty, which filed for bankruptcy last month, is operating at all five of its statewide locations and plans to reorganize to repay debts and stay in business.
The company initially listed assets of $1,757,658 and debts of $2,420,618, figures which have since grown to $3,165,548 in assets and $5,440,212 in debts, according to recent court filings.
Skinner yesterday said business has been good since the company got its new fleet last November. But the burden of seven low-performing months -- along with Skinner's $2 million purchase of 200 Hyundai Alantras -- put the company in the red.
Attorney Chuck Choi, representing the franchisee, said no business reorganization plan has been drawn up. He said plans call for a large infusion of cash by an unnamed investor to pay the company's operating expenses while revenues would go toward repaying creditors.
Skinner said franchiser Thrifty Rent-A-Car filed a temporary restraining order preventing the franchise from obtaining cars in a timely manner. He noted during yesterday's hearing that the company's monthly revenues, which now average $800,000, dropped to $400,000 during the dispute.
Business is now good, Skinner said, and the company has a fleet of nearly 1,000 cars.
Skinner, who bought the Thrifty franchise in March 1997, said the company grew quickly, tripling its staff to about 100 employees in about 18 months.
The company has five locations statewide, including Waikiki, Nimitz Highway near Honolulu Airport, and in Kona, Kahului and Lihue.
Skinner, acting president of the Car and Truck Rental and Leasing Association in Hawaii, operated Aloha Funway Rentals in 1975. The company was renamed Courtesy Car & Truck Rental in 1991.