Hertz rental company will sell 20,000 electric cars and buy gasoline

Car rental company Hertz has decided to sell around 20,000 electric cars, including Tesla models in the United States, and replace them with gasoline-powered cars. After investing heavily in electric vehicles, including public-private partnerships in some cities, the company felt the market cool down and chose to cut a third of its fleet of electric vehicles available for rent.

According to the North American network CNN, executives claimed that electric models have harmed the company’s finances, as, despite the low maintenance cost, they have higher damage repair expenses, in addition to higher depreciation.

About 80% of Hertz’s electric vehicle fleet is supplied by Elon Musk’s Tesla. The manufacturer has “aggressively” cut the prices of new models, which leads competitors to do the same. As a result, used cars lose more value, which directly affects companies like Hertz, whose business is buying and renting used cars.

Added to this, repair costs are high, as there are not many spare parts available.

“Collision and damage repairs on an electric car can often cost about twice as much as those associated with a comparable combustion engine vehicle,” Hertz CEO Stephen Scherr told CNN.

Initially, the idea was that by the end of 2024, 25% of the fleet would be entirely generated by electricity, according to Reuters. According to the agency, Hertz’s decision highlights that growth in electric vehicle sales is slowing, leading automakers such as General Motors and Ford to reduce their production plans.