Fitch Ratings service recently brought the debt rating of Hertz Corp to a “BB-“. It had been at an already bothersome “BB” rating. The downgrade further into “junk” status was cited as being because of the weakening in the rental car market and the risk of some near-term refinancing.

When asked for comment, the Fitch Agency stated that, “Although Fitch recognizes modestly improving trends in leisure pricing and in the form of advance bookings for the peak rental car season, it is Fitch’s expectation that longer-term profitability and cash flow will not return to previous peak levels,” This has been troublesome news for shareholders as Hertz has fallen substantially in recent months. However, on this day the stock closed unchanged despite a moderate fall within hours of Fitch’s downgrade.

Fitch went on to state that it expects Hertz to be able to refinance $4.3 million in debt maturing in 2010, yet cost are most likely expect to be much higher.

The rating outlook is undoubtedly negative. This means there could be further rating cuts if rental car demand continues to plummet.  the company’s balance sheet could be even more pressured in coming months and in the next couple of years.