As companies continue to keep stores closed and feel the effects of the global COVID-19 shutdown, certain industries are taking out large amounts of revolving loans just to stay afloat.
According to data from Goldman Sachs, companies working within the auto industry have taken over $38 billion in revolving drawdown loans since March 1. That’s the most out of any industry, and just ahead of retail, which has taken out over $35 billion in revolving loans. The travel and leisure industry came in third place with over $23 billion in loans.
Distress and bankruptcies are rising at unprecedented levels. Industries and companies that were once thought of as relatively stable – such as travel, hotels and automotive – are facing pressures they’ve never felt before. To ease some of that panic, financial restructuring and the accumulation of debt are being pursued by many companies.