bitkahuna

iTrader: (20)

guess i won't be renting a tesla next time! (used ev prices are going to take a further hit...)

Rental giant Hertz dumps EVs, including Teslas, for gas cars

Jan 11 (Reuters) - Rental firm Hertz Global Holdings (HTZ.O) is selling about 20,000 electric vehicles, including Teslas, from its U.S. fleet about two years after a deal with the automaker to offer its vehicles for rent, in another sign that EV demand has cooled.

Hertz will instead opt for gas-powered vehicles, it said on Thursday, citing higher expenses related to collision and damage for EVs even though it had aimed to convert 25% of its fleet to electric by 2024 end.

CEO Stephen Scherr had last year at the JPMorgan Auto Conference flagged headwinds from higher expenses for its EVs, particularly Teslas.

Hertz even limited the torque and speed on the EVs and offered it to experienced users on the platform to make them easier to adapt after certain users had front-end collisions, he said.

Shares of the company, which also operates vehicles from Swedish EV maker Polestar among others, fell about 4%. Tesla's (TSLA.O) stock was down about 3%.

Hertz also expects about $245 million in charges related to depreciation expenses from the EV sale in the fourth quarter of 2023.

BUMPY ROAD FOR EV GROWTH

Its decision underscores the bumpy road EVs have hit as their sales growth slows, causing carmakers like General Motors (GM.N) and Ford (F.N) to scale back production plans.

Morgan Stanley analyst Adam Jonas said in a note Hertz's move was another sign that EV expectations need to be "reset downward".

While consumers enjoy the driving experience and fuel savings (per mile) of an EV, Jonas said there are other "hidden costs to EV ownership".

"Expenses related to collision and damage, primarily associated with EVs, remained high in the quarter," Hertz said in a regulatory filing on Thursday.

The company, which had earlier planned to order 100,000 Tesla vehicles by 2022 end and 65,000 unitsfrom Polestar over five years, said it would focus on improving profitability for the rest of its EV fleet.

German rental car company Sixt said in December it had not purchased Tesla vehicles since 2022 and was selling its fleet of Teslas "as part of our regular de-fleeting process".

It still plans to offer a range of electrified vehicles and "stick to our goal to electrify 70-90 percent of our rental fleet in Europe by 2030", it said on Thursday.

USED-EV PRICES DROP

Meanwhile, wholesale used-EV prices fell for most of 2023 as prices for new EVs fell and inventories of unsold electric vehicles rose, according to *** Automotive data.

*** forecast before Hertz's decision that used-EV prices would decline more than overall used vehicle prices in 2024.

"While 20,000 cars isn't a large number in the total used vehicle market, it does mean Hertz will be taking a major loss on each of these sales while further contributing to the trend of falling used EV values," iSeeCars.com analyst Karl Brauer said.

Hertz is selling some Tesla Model 3 for as low as about $20,000, nearly half the purchase price for the cheapest variant of the compact sedan, its used car website showed.

It lists more than 700 EVs on sale, including BMW's i3, Chevrolet's Bolt and Tesla's Model 3 and Model Y SUVs.

Reporting by Nathan Gomes and Akash Sriram in Bengaluru, Joe White in Detroit; Editing by Shilpi Majumdar, Sriraj Kalluvila and Arun Koyyur
https://www.reuters.com/business/aut...et-2024-01-11/

swajames

Hard to know what to make of this. You only have to look at the systems and customer service failures that ended up with customers literally getting arrested because Hertz couldn’t handle basic things that every other competitor can do blindfolded to know they aren’t the best run. So you have to think at least some of this - and likely quite a lot of this - is down to hertz mismanagement on the EV rollout. They never did seem to have their act together on EV rentals. Hardly surprising as they never seem to have their act together on non EV rentals either…

RXSF

I’ve rented a hertz tesla maybe 4 times now. Each time it’s a pleasant experience except for the charging part. Because they give it to you at 100%, they expect you to return it at 100% or incur a 20 or 25 dollar fee. That means I always have to look for a supercharger near the airport and even though it’s fast charge, the last 10% takes a long time.

I can’t even imagine what it must be like to rent a non tesla. Though at this point the small fee might be worth it to save time

bitkahuna

iTrader: (20)

^^^ i think when i rented a tesla from hertz they wanted it back with 80% charge or more. was no problem.

RXSF

Really? Can you find any official hertz document that says that? It would be really helpful to know before my next rental. This is the only thing I could find.

https://www.hertz.com/us/en/blog/ele...s-it-necessary

BayeauxLex

assuming there was a nearby charger.

The times I’ve rented a Tesla I had to let the owners know it would be a little less than 80% because there wasn’t a charger close by.

patgilm

I rented a Model 3 from Hertz and it only had 67% charge so I only had to bring it back with the same charge just like a gas powered car. I also had a good experience with them.

I’m headed to Florida tomorrow and considered renting another Model 3 but it was more than I wanted to pay and it is just easier and faster putting in gas in a regular rental. Although if Hertz only charges $25 why not just bring it in with a low charge, it’s cheaper than gas.

Margate330

That's what I would do

From what ya'll say, the charging from 80%-100% is what takes a while so I wouldn't go far out of my way for $25.

I'd let them top it off
Talk my old lady to showing some cleavage and maybe get it waived. Haha

spwolf

you guys are so progressive. I would have never rented a Tesla when traveling, let alone some other EV brand.

geko29

When I rented a Polestar 2 from National/Enterprise, there was no SOC requirement on the return. I still returned it at >90% (hotel has a free charger, and went straight from there to the airport), but they didn't care.

jrmckinley

I didn't think about the cost of damage of EV compared to ICE when thinking about the rental companies transitioning portions of their fleet. It's probably a combo of time + cost + less options of shops to repair that creates a bigger headache for them.

bitkahuna

iTrader: (20)

ha... well i did it to get the experience plus did quite a bit of research ahead to make sure i'd be good with charging.

one person on here rented a tesla on the hawaiian island of kauai where i think they had 1 level 2 charger on the whole island, lol.

spwolf

problem with damages was that these cars ended up being in Uber fleet. Model 3 is very low to the ground vehicle, and I am sure it got really abused. If you scrape the bottom, which is easy to do in Model 3, you scrape the battery.
Not the car you would beat up as a rental.

spwolf

yeah, exactly. Now imagine your average joe - lets even say Tesla is fine, what about other EVs they rent? It is so complicated to learn while you are renting, and without access to SC network, it just sux.

SW17LS

That just makes sense. Renting an EV without being able to easily charge it overnight just really doesn't make any sense.