Hertz’s EV Selloff Boosts Used-EV Market

In late 2021, car rental giant Hertz ordered around 100,000 battery electric vehicles (BEVs) worth $4.2 billion from Tesla. The purchase gave Hertz the largest electric vehicle fleet in North America and was a great sign for the nation’s fledgling electric vehicle industry. If a fleet manager such as Hertz bought into the electric-vehicle dream, it could significantly increase access to the vehicles among the general public, help drivers become more familiar with new EV technology and maybe even increasing the chances of drivers purchasing an EV.

However, Hertz announced that it was selling off a large chunk of its electric vehicle fleet just two years later in early 2024 as part of a company-wide shift in strategy. The car rental company sold around one-third, or 20,000, of mostly Tesla EVs, partly due to a reduction in consumer spending, slowing demand and an increasingly competitive electric-vehicle market. Fleet companies also cycle through cars much faster than the average driver, and Hertz found that Tesla EVs burn through tires much faster than anticipated, took longer to repair, and had higher repair and maintenance costs than initially expected.

The selloff wasn’t a great moment for America’s EV sector, but the used-electric-vehicle industry was ultimately a major beneficiary. With Hertz selling 20,000 predominantly Tesla electric cars at up to 39% off, the second-hand EV market was flooded with affordable EVs. Thousands of EVs from Hertz’s fleet, including Tesla Model 3s, Chevy Bolts, and a couple of other EV models, are now available on online marketplaces. Due to the heavy use most of these EVs experienced in their two years of service, buyers should make sure they analyze potential purchases for wear and tear as well as environmental exposure. They should also be aware of the repair and maintenance costs that may go into owning an EV that was previously part of a fleet.

Even so, interested buyers can find plenty of great finds on sites such as the Hertz used-electric-vehicle platform. The car rental company’s decision to sell off a portion of its EV fleet prematurely also means that many of its used EVs have less than 10,000 miles on the odometer. For drivers who were interested in switching to EVs but couldn’t or didn’t want to break the bank buying a new electric car, the Hertz selloff could be the ideal time to buy a more-affordable used EV without a lot of miles on the odometer.

As more models from brands such as Lucid Motors (NASDAQ: LCID) also make their way into the used-EV market, cost-conscious buyers will have a wider range of options to make their entry into the green-energy transport niche.

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