Hertz wanted to save itself from collapse by investing heavily in Teslas. Now it becomes clear in detail why they abandoned it.
It was a striking news item: Hertz is taking a step back. The corona crisis had a major impact on the American rental company and it was thanks to an investor that it still exists at all. To keep up with the times, a mega order was placed for a slew of Teslas, about 100,000 Model 3s and Model Ys.
Gambled and lost
Genius, right? This mega deal, even with Elon Musk's approval, meant that Hertz had a huge range of EVs much sooner than major competitors. Moreover, the timing couldn't be better, looking at the gigantic numbers that Tesla recorded. And yet at the beginning of this year it was announced that Hertz is massively reducing their fleet of Teslas, with the ex-Hertz models appearing on the used car market for next to nothing. The replacements for Teslas will largely be petrol cars. This joke also cost Hertz hundreds of millions of dollars. What happened there?
Users
One of the reasons is of course the currently less rosy figures for Tesla, but that is certainly not the main reason. No, the main reason is the tenants. Yes, you yes. Not kidding: not being easy to use is what killed the Teslas. For example, the direct acceleration was not easy for everyone to understand and that caused a lot of damage. Sometimes before they even left the parking lot of the location. According to Hertz's own figures, they had four times as much damage with Teslas as other vehicles in their fleet.
Cost
When a car, in this case a Tesla, is broken, it needs to be repaired. That was also a headache. Relatively common items such as repairing and recalibrating the Autopilot sensors can cost up to $4,500 per car. Not to mention more serious damage that immediately made the Teslas a total loss. It ensured that Hertz saw a 13 percent increase in keeping the fleet running in 2023, the third year of the Teslas, which is an amount of 5.5 billion(!) dollars. Compared to the then almost Tesla-less 2020, this is 39 percent more.
Range anxiety
But before people could drive damage, they first had to choose a Tesla from Hertz. As an EV driver and/or EV owner, you understand and learn to live with the challenges that charging and limited range entail. As a traveler just looking for a rental car without the hassle, you are less willing to do so. Then it turns out that range anxiety is still really ingrained in most people. It turned out that non-electric cars were by far the most popular choices. If you went to the rental car booths late one evening without a reservation, Hertz could only offer you the Teslas left behind. And even then they were not chosen: they would go to the competitor.
This and more in the comprehensive report on the Tesla gamble The Business Times.
This article Hertz's mega-purchase of Teslas was a gamble and lost first appeared on Autoblog.nl.
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