Motor Trend reports that Hertz is dumping 20,000 EVs out of 50,000 from their global fleet. It seems they cost a lot to repair.
According to a filing with the Securities and Exchange Commission related to the sale, Hertz “expects to reinvest a portion of the proceeds from the sale of EVs into the purchase of internal combustion engine (“ICE”) vehicles to meet customer demand.”
It’s not just consumer demand behind this.
They mostly blame it on Tesla, but none of the EVs are selling, and they have serious infrastructure problems with the scarcity of charging stations. At least Tesla has charging stations.
There were several factors, but the biggest was repair costs for rideshare EVs, which were much higher than expected. This is collision repair costs.
According to Johann Rawlinson, Hertz VP of Investor Relations, “collision and damage repairs on an EV can often run about twice that associated with a comparable combustion engine vehicle.”
Stephen Scherr, Hertz’s CEO, said, “There’s quite a bit of the cost element that relates to the Teslas as opposed to others.”
Another factor to put Hertz’s sale in context is the plummeting value of EVs in generally spurred by Tesla’s steep price cuts recently. Hertz’s investment in EVs predates the price cuts. In other words, Hertz bought high and is selling low.
In December, a consumer reports analysis found that EVs have 80% more problems than gas-powered cars.
The consumer group found that plug-in hybrid electric vehicles (PHEV) have an even worse scorecard, with an average of almost 150% more problems. By contrast, the analysis found that ordinary hybrid cars are a “bright spot,” with about a quarter fewer problems than gas-powered cars.