Hertz is taking a more cautious approach to EVs than it did in the past. The company is still investing in EVs, but it is doing so at a slower pace and with a greater focus on profitability.

“We want to offer our customers the widest possible choice of vehicle makes and models, whether gas-powered or electric so that they can travel the way that best suits their needs and preferences. We know the challenges at hand and are working to remedy that, which we can. And will pace ourselves accordingly with an expectation that our in-fleeting of EVs will be slower than our prior expectations, but we will be stronger for having begun the journey when we did”. -Stephen M. Scherr – CEO & Chairman, Hertz Global Holdings, Inc., Q3 2023 Earnings Call Transcript, October 26, 2023

Hertz committed to buying 100,000 cars from Tesla and 175,000 EVs from GM, but their previous forward-looking statements will not meet the target of 1/4 of its fleet being electric by the end of 2024. Approximately 11% of  Hertz’s entire fleet is electric (50,000 cars), and 80% (35,000) are Tesla.  Hertz is still bullish on EVs in the long term. The company believes that EV ownership will continue to grow, and that rental demand for EVs will grow in tandem.

Hertz is restructuring its EV strategy due to:

• EV damage costs are higher than expected. Hertz is working to reduce EV damage costs by partnering with OEMs, educating drivers, and improving its underwriting process.
• Tesla MSRP declines have reduced the fair market value of Hertz’s EV fleet. This is leading to larger losses when EVs are salvaged.
• Hertz is over-fleeted with EVs in the leisure channel (car rental). This is driving down RPD (Revenue Per Day) for EVs.
  

To address these challenges, Hertz is taking the following steps:

• Slowing the pace of EV in-fleeting. This will give Hertz time to reduce EV damage costs and to balance its EV fleet across all channels.
• Moving more EVs from the leisure channel to the rideshare channel. This will help to improve RPD for EVs.
• Working with OEMs to improve EV durability and performance. This will help to reduce the risk of EV damage.
• Educating drivers on how to properly operate and care for EVs. This will also help to reduce the risk of EV damage.
  

Overall, Hertz is restructuring its EV strategy to ensure that it is profitable and sustainable in the long term. The company is committed to offering its customers a wide range of EV options, but it is also taking steps to mitigate the risks associated with EV rental. 

Go electric ✌️