Quarter 1 of 2023 saw Hertz achieve a significant milestone in the journey toward electrifying its fleet. By April, the car rental company had 50,000 electric vehicles, accounting for 10% of the company’s whole fleet. By year’s end, rentals of electric vehicles are also expected to rise by five times to reach 2 million trips. This is an enormous improvement that demonstrates a growing demand for clean, emission-free vehicles, because rentals are continuously increasing as the company’s fleet of zero-emission vehicles expands.
Hertz generated revenue of $2 billion for the first quarter of 2023, which was motivated by a significant increase in demand for rental vehicles as the northern hemisphere’s spring season approached. In order to give its rental clients other options, Hertz also began receiving deliveries of non-Tesla electric vehicles from General Motors as well as other companies. In addition to that, the reduction in prices of electric vehicles in the first quarter of 2023, especially Tesla vehicles, helped Hertz tone down its expenses while starting off the year.
Hertz plans to have 25% of its vehicles entirely electric by 2024’s end, which gives it less than 18 months to expand its fleet of electric vehicles by an additional 75,000 vehicles and retire an equal number of traditional vehicles that are getting on in years. Hertz made an announcement in 2022 that it would purchase an additional 65,000 electric cars over the course of five years through a partnership with Polestar. In the latter half of last year, the Hertz-Polestar Pact took effect in Australia, enabling travelers to hire Polestar cars provided by Hertz locations around the nation.
This Hertz-Polestar agreement was based on the 2021 placement of 100,000 electric vehicle order to Tesla. In October 2021, this large order caused Tesla’s stock price to reach a value of more than $1 trillion. Further deals involve 175,000 electric vehicles from General Motors, which will include the Chevrolet, Cadillac, Buick and GMC, as well as BrightDrop vehicles, in the future.
Following the announcement that it would expand its partnership deal with Uber, a ride-sharing firm, Hertz is now stepping up operations abroad as well. Both Tesla and Polestar electric vehicles are now being added to the Hertz-Uber alliance in the United States, which is currently being used outside North America. The company’s strategy to promote environmentally friendly transportation in Europe calls for the deployment of 25,000 electric vehicles.
According to the company, maintaining electric vehicles is 50% less expensive than maintaining equivalent internal combustion engine vehicles. Additionally, Hertz uses its fleets more efficiently and experiences fewer maintenance interruptions.
Car rental firms have a pivotal role to play in the electrification of the auto industry, because they provide room for motorists to try out these vehicles before committing to buying one. As Hertz and other such companies ramp up plans to electrify their fleets, manufacturers such as Fisker Inc. (NYSE: FSR) stand to register increased demand for their vehicles as rental EVs become commonplace on the roads.
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