After an ambitious electric vehicle push in recent years, the Hertz rental car company will reduce its EV fleet by one-third to make room for more gasoline-powered vehicles.
In a regulatory filing submitted Thursday, the car rental giant said it will scale back roughly 20,000 electric vehicles as they have higher damage-repair costs and higher depreciation.
Hertz told investors at the end of the third quarter of 2023 that Tesla price cuts reduced the resale value of the other EVs in its fleet, “increasing vehicle depreciation expense and negatively impacting salvage cost.”
Primarily driven by Tesla dropping prices of new vehicles in 2023, people are now less likely to buy used EVs from Hertz.
Around 80% of the battery electric cars are Teslas at the company, and EVs make up around 11% of Hertz’s total rental fleet. Out of Hertz’s roughly 50,000 electric cars, about 35,000 are Teslas.