Rental vehicle company Hertz has seen its annual profits jump by 12% since adding electric vehicles (EVs) from Tesla, Polestar, and more to its fleet — reports The Cool Down.
Hertz kicked off its transition to EVs by signing a $4.2 billion USD deal with Tesla for 100,000 units of the company’s Model 3 sedan in late 2021.
Since then, the company has also added Tesla Model Ys to its rental fleet, started taking deliveries of the first of 65,000 EVs from Polestar, and announced a partnership with General Motors to purchase up to 175,000 EVs through 2027. The GM deal puts Hertz squarely on track to achieve its electrification goals.
Back in October 2022, Hertz CEO Stephen Scherr reported $2.5 billion in revenue during the company’s third-quarter earnings call.
Hertz’s explosive revenue growth figure is partly a function of increasing corporate demand for the company’s EV rentals, which have risen to 70% of pre-pandemic levels. In September 2022, Scherr said that Hertz is seeing “very, very solid” demand for Tesla rentals.
“We focused on operational excellence and fleet optimization to produce financial results that facilitated investment in our strategic priorities, like electrification, while enhancing returns to our shareholders and being in the service of our customers,” Scherr said during the company’s Q3 earnings call.
Hertz also discovered that EVs are 50-60% cheaper to maintain than gasoline-powered vehicles, with the savings in maintenance costs further boosting the company’s earnings.
“And so I think, the open of that valve if you will, the supply of EVs to add to what we’re doing around Tesla, and Polestar, I think will be a positive, both in terms of customer experience and in the overall economic picture around depreciation, for our products set,” Scherr added.
