Ryanair In Ugly Feud With Hertz

(RTTNews) - Irish no-frills airline Ryanair Holdings Plc. (RYA.L, RYAAY) and Hertz Global Holdings Inc. (HTZ) have ended their exclusive car hire supply agreement with immediate effect.

The budget airline said it would pursue Hertz for breach of contract.

Ryanair expects that any loss arising from this interruption to car hire services will be recovered from the legal proceedings against Hertz, and does not expect this interruption to have a material impact on current earnings.

The airline said it received a notice from Hertz this morning, purporting to terminate Hertz's exclusive car hire supply agreement with Ryanair with effect.

Hertz alleged that Ryanair's agreement with GDS distribution companies represents a breach of contract. Ryanair has disputed this claim stating it has been distributing through GDSs since April 2014 with Hertz's knowledge and support.

Hertz confirmed in the notice that all existing bookings would be honored and customers would still be able to modify their bookings on the microsite following its decommissioning at 12:00 hrs today.

Ryanair believes this termination is in breach of its long term exclusive contract with Hertz, which was recently extended for a 5 year period to 2020.

The airline will pursue Hertz for breach of contract and damages. In the interim, the company will be unable to offer its customers car hire services through the Ryanair.com website for about three months while it seeks a suitable replacement supplier.

Ryanair said it would, by close of play today, issue a request for proposals for the provision of car hire services to its 100 million annual customer base.

The company expects to have a replacement supplier linked to the Ryanair.com website by October which will coincide with the launch of Ryanair's new and improved personalized website and mobile app.

RYA.L was unchanged at 12.30 pence. HTZ slid marginally on Wednesday to $17.57.