Hertz’s Tesla rentals are off to a successful start.
Key Details
- The Hertz CEO Stephen Scherr says that the demand for the company’s new fleet of Tesla electric vehicles (EVs) is strong.
- “Demand has been very, very solid. We’re seeing demand not just among leisure travelers but also among corporate travelers, where in fact corporations want their employees in an electric vehicle to satisfy some of their own carbon footprint objectives,” says Scherr.
- “And of course, we’ve been renting to Uber and Lyft as part of their ride-sharing network. Demand across all three has been very strong,” adds Scherr.
- He says that forward bookings look good, and that the holiday period will likely be quite strong.
- “Hertz inked a deal late in 2021 to purchase 100,000 Tesla Model 3s for its fleet by the end of 2022,” reports Yahoo Finance.
- “Goldman Sachs analyst Stephen Grambling estimated that Hertz has been getting more than $100 a day for Tesla rentals against about $60 a day on average for cars in its fleet,” says Barron’s.
Why it’s news
The announcement is a success for Hertz, in its effort to help address the concerns of the green revolution and to keep up with the goals of the current administration.
It is aiming to transition 25% of its rental fleet to EVs by 2024 and has signed multiple deals to purchase vehicles and prepare the infrastructure to support them.
Hertz signed an agreement with General Motors on September 20 to purchase 175,000 electric vehicles by 2027.
It was also announced on September 27 that Hertz signed a memorandum with BP to develop a network of charging stations to support electric vehicles.
The deal benefits Hertz additionally, as premiums are higher on Tesla rentals than gas vehicles. AutoSlash reports that rental rates for Teslas can exceed $200 per day.
Hertz also reported in August that its Tesla fleet costs 50% to 60% lower in maintenance costs.
Notable quote
“Hertz is accelerating the adoption of electrification by investing in the largest rental fleet of electric vehicles in North America and expanding the availability of charging stations. We are excited to partner with bp pulse to create a national charging infrastructure for the Hertz EV fleet, thereby growing the number of charging options available to our customers and providing them with a premium electric experience and lower emission travel options,” says CEO Scherr.
Backing up a bit
As we previously reported, President Joe Biden signed the Inflation Reduction Act on August 16, which plans to end the sale of new gas-powered vehicles by 2035. The EV market has skyrocketed as a result of large amounts of venture capital and investment pouring into development and domestic production.
Major automakers have been working to transition their current lines of gas-powered vehicles out and slowly build up the infrastructure to support EV production and usage. Dodge has announced a new line of EV muscles and Ford is opening new EV factories in Kentucky and Tennessee. Tesla, GM, and Ford have made significant efforts to build and secure American battery plants.
