Rental firm Hertz Global Holdings (HTZ.O) said on Thursday it would sell about 20,000 electric vehicles, including Teslas, from its U.S. fleet due to higher expenses related to collision and damage, and will opt for gas-powered vehicles.
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 to book an about $245 million charge related to depreciation expenses from the proposed EV sale in the fourth quarter of 2023.
Hertz’s decision underscores the bumpy road EVs have hit as the growth rate on sales of those vehicles has slowed, causing carmakers like General Motors (GM.N) and Ford (F.N) to scale back production plans of those vehicles.
Morgan Stanley analyst Adam Jonas in a note said the car rental firm’s move was a warning across the EV space and it was another sign that EV expectations need to be “reset downward across the market.”
“While consumers enjoy the driving experience and fuel savings (per mile) of an EV, there are other ‘hidden’ costs to EV ownership,” Jonas added.
I wouldn’t be surprised if the hidden costs aren’t just around time. EVs are great, generally, but they’re sort of purpose specific. Having a 250 mile range (at best), people generally not knowing where to recharge, the additional time to recharge, not being able to charge at a lot of hotels, severely limited long range ability (without a lot of stops)… All of those add up to a poor experience. I can’t think of a time where I rented a car and an EV would have been an option that I wanted. MAYBE if I only needed to go as much as a single charge would allow me, but this is just not a good fit for rentals, in my opinion.
100% this. My sister had a nightmare rental experience. The rental company was sold out on gas cars and gave her a Hyundai EV.
She had to drive about 200 miles through some remote areas. When she left, the car said 300 miles. She figured 50% was a good enough buffer. She started driving and range dropped quickly. About 100 mi into the trip, it was saying 40 miles left.
She was in the middle of nowhere with spotty cell reception worried that she would be stranded in the desert. She was afraid enough to call her daughter and say, “If you don’t hear from me, send help.”
The only charger she could find was at a Hyundai dealer. She just made it, but had to sleep in the car until the next morning when they opened to get the car charged.
She swears never again.
That’s not an EV problem, but one of infrastructure.
This is like complaining about useless combustion engines when driving somewhere with no gas stations…
Only partially, inaccuracy in range estimations are certainly an EV problem.
If the infrastructure doesn’t support EVs for a journey, that’s an EV problem.
The argument here is always that EVs need to solve a problem to become viable. No, they don’t. They don’t need to develop EVs with insane ranges to adapt to a non-existent infrastructure.
That’s just diversion. Fix the infrastructure instead of pretending that EVs need fixing imaginary problems first.
Electric cars are a lot heavier and thus more deadly than gas vehicles—I wonder if the costs they mention related to collisions are largely insurance related
It’s because Tesla repair costs are sky high and they never have parts in stock. It’s not an EV problem. It’s a Tesla problem.
And by a lot you mean 10-15% heavier?
Yeah. A model 3 is ~4K freedom units and a Toyota Camry is ~3.5K freedom units.
Source
The Hummer EV is a pretty ludicrous vehicle, and not typical. For a more apples to apples comparison, the gas-powered Hyundai Kona weighs 3005 to 3483 lbs, while the EV version of the same car weighs from 3571 lbs to 3891 lbs, depending on configuration.
Why don’t we compare the Hummer EV to… a Hummer H2? You know, the much smaller, older ICE one that was also 8,600 lbs?