Hertz rental axes large chunk of electric fleet

DPA
·1 min read
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Car rental giant Hertz says it's selling off 20,000 electric cars of various brands in the US alone in a move that sees the company moving back to combustion engine cars. Oliver Berg/dpa
Car rental giant Hertz says it's selling off 20,000 electric cars of various brands in the US alone in a move that sees the company moving back to combustion engine cars. Oliver Berg/dpa

Car hire company Hertz is planning to sell a third of its global fleet of electric cars and will use some of the funds to buy vehicles with combustion engines instead, the company says.

Making the announcement in January, Hertz said the decision was prompted by the need to adapt its vehicle range to suit current customer demand.

Over the course of the year, 20,000 electric cars of various brands are to be sold in the United States. Hertz said it was prepared to accept an additional write-down of $245 million for this step.

Used Tesla Model 3s can now be bought on Hertz's sales pages for upwards of $20,000, while Polestar models are expected soon.

Industry experts believe the move underscores the dip in EV sale growth, with manufacturers like General Motors and Ford scaling back production plans. Morgan Stanley analyst Adam Jonas gave another signal that EV expectations need to be "reset downward".

In autumn 2021, Hertz had announced the purchase of 100,000 Tesla vehicles. This was later followed by announcements of orders for 175,000 electric cars from General Motors and 65,000 from Polestar.

The company's strategy changed last year when Hertz announced its intention to slow down the growth of electric cars in its fleet.

Reasons given included Tesla's repeated price cuts, which had affected the re-sale value of fleet vehicles. It was also pointed out that repairs for damage to electric vehicles are around twice as expensive as for vehicles with combustion engines.