Hertz, which has made a big push into electric vehicles in recent years, has decided it’s time to cut back. The company will sell off a third of its electric fleet, totaling roughly 20,000 vehicles, and use the money they bring to purchase more gasoline powered vehicles.
Electric vehicles have been hurting Hertz’s financials, executives have said, because, despite costing less to maintain, they have higher damage-repair costs and, also, higher depreciation.
“[C]ollision and damage repairs on an EV can often run about twice that associated with a comparable combustion engine vehicle,” Hertz CEO Stephen Scherr said in a recent analyst call.
And EV price declines in the new car market have pushed down the resale value of Hertz’s used EV rental cars.
“The MSRP declines in EVs over the course of 2023, driven primarily by Tesla, have driven the fair market value of our EVs lower as compared to last year, such that a salvage creates a larger loss and, therefore, greater burden,” Scherr said.
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